by James A. Bacon
My wife and I were slow to stock up on CoronApocalypse survival supplies — hand sanitizers, masks, rubber gloves… toilet paper. Big mistake. Now we’re running low on toilet paper, and we’re getting nervous. The shelves are empty of paper-supply products at every store we’ve visited. Except paper napkins. You can still get those. I wouldn’t advise trying to flush them down the toilet, though.
Getting word that Kroger would re-stock early Friday morning, my wife made an emergency run around 8:30 a.m. in the hope of snagging a pack or two. Too late. The shelves were bare.
Meanwhile, Virginia’s Attorney General, Mark Herring, has announced his determination to protect citizens against price gouging. Said the AG in a press release last week:
Virginia law offers protections for folks who find themselves in need of things like medicines, cleaning products, hand sanitizers and other necessities during a public health crisis. I would encourage all Virginians to pay attention to any prices that seem too high, and contact my office as soon as possible if you think someone may be illegally overcharging for necessary goods or running a scam.
Four days ago, WAVY TV reported that the AG’s office had received about 30 complaints of possible price gouging. Here’s my question: If we’re going to prosecute people for “price gouging” — raising prices to “unconscionable” levels — shouldn’t we also prosecute people for hoarding? Frankly, who in our current crisis is the bigger menace to society — the price gougers or the hoarders?
In times like this, say the better angels of our nature, we should all share with those in greatest need. I like that idea — those in greatest need of toilet paper soon may include me. I can see myself knocking on the neighbor’s door and pleading, “Bother, can you spare a roll?”
But speaking realistically, people are not always inclined to be charitable when their health and personal hygiene are at stake. Most people aren’t hoarding toilet paper because they plan to turn around and sell six-packs for outrageous prices on eBay. They’re stockpiling rolls because they’re terrified of running out. Indeed, having packed their pantries full, they’re still snatching up more… even as their fellow citizens go wanting. Now that’s unconscionable!
How do we discourage this kind of anti-social behavior? One way would be to allow retailers to raise the friggin’ price of toilet paper. Raising the price of something in order to conserve it is an economic concept well known in other arenas. Environmentalists, for example, are keen to raise the price of gasoline and electricity to conserve energy and reduce greenhouse gas emissions.
Raising retail prices discourages hoarding. It’s one thing for a hoarder to pay $9 for a six-pack of ultra-soft, double-ply bath tissue. It would be quite another thing to pay, say, $18. The hoarder would make the mental calculation: If I pay $18 for a pack today, it might be worth only $9 three or four weeks from now. Do I really need a year’s supply? Maybe I ought to leave those rolls on the shelf so some lost soul like Jim Bacon can buy them.
Another thing happens when the price doubles. People use less toilet paper. Yes, the tightwads among us count every square. Responding thus to price signals, we stretch supplies. That is a good thing in times of scarcity.
Admittedly, there are people who raise our hackles by charging what one might deem “unconscionable” prices. Checking Google, I see that someone on eBay is charging $37.99 for a sixpack of Great Value brand ultra strong premium toilet tissue. What a jerk.
However, he won’ t be profiteering long. After enough people have stuffed enough closets with enough TP, and after the TP manufacturers crank up production and flood the market, demand will fall, supply will rise, and prices will return to normal — or below normal. And the hoarders and profiteers will get their just desserts. The market will teach the price gougers a lesson long before Mark Herring does.
