Zimbabwean Economics Spreads to Capitol Hill
In Zimbabwe, the government is ordering businesses to cut prices and threatening to jail executives who don’t comply, in an attempt to deal with inflation that is now variously estimated at somewhere between 4,000 and 20,000 percent a year.
Meanwhile, on Capitol Hill both houses of Congress have passed legislation establishing stiff penalties for those found guilty of gasoline price gouging. The bill directs the Federal Trade Commission and Justice Department to go after oil companies, traders, or retail operators if they take “unfair advantage” or charge “unconscionably excessive” prices for gasoline and other fuels in an “energy emergency.” (The complex energy legislation is still working its way through both houses, though both have endorsed the price-gouging provisions.)
How’d'ja like to be the bureaucrat charged with enforcing such vague and emotional language, or the businessperson trying not to incur a 10-year jail sentence for doing something “unfair” or “unconscionably excessive” It’d be sort of like living in, you know, Zimbabwe.
Did Congress offer bureaucrats and businesses any more specific guidance You bet they did. H.R. 6 and S. 1263 define an ”unconscionably excessive price” as a price that
(A)(i) represents a gross disparity between the price at which it was offered for sale in the usual course of the supplier’s business immediately prior to the President’s declaration of an energy emergency;
Posted on June 28, 2007 Posted to Cato@Liberty,Economics & Economic Philosophy,Energy,Int'l Economics & Development