No, We Are Not Running Out of Food and Toilet Paper

Hei Lun Chan

Hei Lun Chan

Hei Lun is a retail manager living in Massachusetts. His interests include eating, running, video games and board games. He's a sports fan who doesn't watch sports. He's mostly a libertarian even though Facebook ad preferences thinks he's a "very liberal". His Twitter handle is @heilun_chan

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97 Responses

  1. Avatar Aaron David
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    says:

    Excellent article covering many of the basic logistics issues we are facing. I used to work logistics for a big box retailer and the distro centers will have plenty of room available, but turning on a dime from the preset patterns of buying, stocking and shipping in a just-in-time world is very difficult. Right now many of them were starting on fall special products.Report

  2. Avatar Jaybird
    Ignored
    says:

    I saw a lovely picture earlier today showing a sign at Costco saying “We will not allow returns of: Toilet Paper, Paper Towels, Rice, Cleaning Supplies, or Sanitizing Wipes”.

    One of the things that was a safe bet a few days ago was “we can buy 25 packs of TP, and sell 24 of them on Craigslist for a hefty profit! If we don’t sell them all, we can return the rest and all it cost us was the gas it took to drive to the store!”

    Now people will have to think “wait… what am I going to do with 25 packs of 48 rolls of TP if I can’t sell them?”

    So maybe that’ll slow some of the more hoardy people out there down.Report

  3. Avatar Gabriel Conroy
    Ignored
    says:

    The OP is right, of course. Unfortunately, I choose to do my own share of panic buying. I mostly stuck to things I use regularly, but I bought more than I need. For example, I got two jars of peanut butter instead of one. (To be clear, I actually eat a lot peanut butter, but it’s hard to say I “need” it.) In my pantry I now have 6 cans of diced tomatoes whereas I usually only keep two (or four at the most).

    The weird thing about this scarcity mentality is that more is never enough. I have three half gallons of milk in the fridge. (I normally keep three, because we go through it pretty quickly.) But I want a fourth. If I had a fourth, I’d probably want a fifth half gallon. I bought evaporated milk, which I almost never do, but I can (and will) use it in my coffee. But I bought a second can of evaporated milk, too.

    It is sometimes interesting the things that don’t sell out. For some reason (at least at my grocery store), chips are still in plentiful supply. I realize they’re not the healthiest item, but I would have thought people would stock up. Olives, too, for some reason are in massive supply (again, at my grocery store….others may be different).

    I do realize that at least speaking for myself, I’m fortunate to be affluent enough to afford everything I need and almost everything I want. I realize others are really hurting. Such is greed. If we (if I) choose to indulge it, there will never be enough layers of supply. Greed (in the sense of “layers of supply = security”) is always with us. For those of us, like me, lucky enough to live in a well-supplied society and lucky enough to have the resources to take advantage of that supply, greed is hidden. But it’s always there. Times like these remind me of that fact.Report

    • Avatar Kristin Devine in reply to Gabriel Conroy
      Ignored
      says:

      But that is not panic buying. That is not greed. That is what people SHOULD do. Buy slightly more of things they will use up anyway. The last thing, the very last thing the government needs in an emergency like this is people who are valiantly trying not to “hoard” who end up having to keep going to the store. Every time you set out to get something you run the risk of catching/spreading the virus. And if you were to get sick, or have to shelter in place, and you run out of food, then what?? Someone has to get and bring you food, again, risking you catching the virus, risking them catching it from you if you had it. Multiply that by several thousand times and it’s clear that 2 jars of PB and 6 cans of tomatoes may actually save lives in the end.

      IMO you have done exactly the right thing and are being perfectly sensible.Report

  4. Avatar Dark Matter
    Ignored
    says:

    If we let the market work and allowed prices to rise, then we would see less pointless hoarding and less people running out of toilet paper.

    Since we’re not allowing “price gouging” in the face of sharply increased demand, we have shortages… also known as inefficient allocation of resources. If I’m totally out of toilet paper and need to spend many hours driving between stores, then that’s a larger problem and more costly than paying a few extra bucks.Report

    • Avatar DensityDuck in reply to Dark Matter
      Ignored
      says:

      We talked about this in another thread, and my response was that allowing prices to float freely only works in a world of infinite suppliers and infinite supply, where there’s always more providers available that can immediately come on-line as prices rise and they become profitable. If there’s a limited supply then prices stop being about the cost of provision and turn into a bidding war between buyers.

      Like, it doesn’t matter how many people in the store want more toilet paper if the truck with toilet paper on it won’t arrive for another three days. There are not independent toilet-paper plants out there with full warehouses waiting for wildcat truckers and their chimpanzee copilots looking for that one big score that’ll put them over the top.

      “If I’m totally out of toilet paper and need to spend many hours driving between stores…”

      time is money, sir, therefore you’re complaining about high prices (upside-down-smiley)Report

      • Avatar Dark Matter in reply to DensityDuck
        Ignored
        says:

        my response was that allowing prices to float freely only works in a world of infinite suppliers and infinite supply,

        This is simply untrue. In most situations we have neither infinite supply nor infinite demand.

        Further what is the definition of “works” here?

        If there’s a limited supply then prices stop being about the cost of provision and turn into a bidding war between buyers.

        Yes, and why is that a bad thing?Report

        • Avatar Chip Daniels in reply to Dark Matter
          Ignored
          says:

          Further what is the definition of “works” here?

          This.

          This is the question.
          Because while we sit around here and chew the fat about what is moral or immoral, right or wrong, the real question we are discussing is “How do we as citizens arrange our affairs”?
          What laws or regulations do we have our representatives enact, and what are our end goals?
          What do we want to end up with?

          The difficulty is that these questions can’t be answered in isolation from each other. Our goals as citizens are complex and have relationships to each other.

          We want an efficient allocation of resources yes, but also a high-trust high- cooperation society.
          Its common for societies to adopt one set of rules for normal times, but change to a different set during emergencies.
          Because the balance between individual freedom and collective action changes.
          Its that whole “Liberty/ Order” thing I mentioned the other day.

          Maybe in normal times a shortage on paper or plywood or sandbags would be a minor ripple, barely worthy of collective action.
          But in times of a natural disaster, the levels of cooperation needed are severe.
          The lifesaving rules, like evacuations or shelter in place are voluntary, and require a lot of goodwill and trust that everyone is thinking of the good of the community, not just themselves.

          That’s why the news like those Senators dumping their stocks or people hoarding sanitizer are so disturbing; they erode our ability to function as a cohesive entity against a common enemy.

          And in the end, there are plenty of ways to ensure a steady supply, other than prices.

          Notice how during times of war governments both control prices to satisfy the needs of consumers, but also subsidize production to satisfy the needs of producers. Maybe not a good solution during normal times, but a proven solution during emergencies.Report

          • Avatar Dark Matter in reply to Chip Daniels
            Ignored
            says:

            And in the end, there are plenty of ways to ensure a steady supply, other than prices.

            This is assuming what you should be proving.

            …during times of war governments both control prices to satisfy the needs of consumers, but also subsidize production to satisfy the needs of producers.

            When I look at the cartoons of WW2 and how the rich bad guy had things like sugar and tires, my impression is “satisfy the needs” wasn’t happening.

            We have a long list of failures, both theoretical and real world, for price controls. Everything from the oil shortages of the 70’s to generators after a hurricane. We want, or at least should want, the market to adjust in the face of shocks because there aren’t good alternatives.Report

            • Avatar Chip Daniels in reply to Dark Matter
              Ignored
              says:

              There are alternate sources of information than cartoons I think.

              For the most part, the public need for scarce items WAS satisfied; There weren’t riots, and the public cooperation level for things like bond sales and paper drives and rubber drives was high.

              So the goals- enough cooperation to meet the common enemy while ensuring both high levels of production and adequate distribution- were met.

              And in fact, price controls for basic foodstuffs like milk lasted up until the 1970s, and there weren’t shortages.

              Again, maybe it isn’t a good idea to do during non-emergency times, but price controls and subsidies are proven to be effective in emergencies.Report

              • Avatar Dark Matter in reply to Chip Daniels
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                says:

                lack of a riot is hardly a metric for measuring success, much less a measurement for the best economic outcome.

                …price controls and subsidies are proven to be effective in emergencies.

                Mostly we these are political posturing and virtue signally in a way that’s totally removed from the underlying situation. The current empty shelves is a good example, that’s probably the worst possible outcome because anyone with desperate need has to go without.

                Another example would be the “generator after a hurricane” thing. You pay $10k extra for a generator if your alternatives are worse, say if you own a store and have a million dollars of perishables that you don’t want to spoil. “Perishables” could mean food or medicine, both of which seem important in the aftermath of a hurricane. “No price gouging” means there are fewer generators around because the surrounding area doesn’t rush in with them to get outsized profits AND ALSO that the few generators that do show up aren’t used to save people in that situation.Report

              • Avatar Chip Daniels in reply to Dark Matter
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                says:

                You’re just reciting theory, and I’m providing real world data.

                Food wasn’t unavailable during the war, the prices were stable, and production remained high.

                And we have plenty of real world evidence of FEMA and the Red Cross and other agencies transporting food and water and generators after natural disasters.

                I’m just saying that price rationing is only one form of allocating resources.

                And given all the other goals that society has, it has some pretty severe consequences.Report

              • Avatar DensityDuck in reply to Dark Matter
                Ignored
                says:

                ““No price gouging” means there are fewer generators around because the surrounding area doesn’t rush in with them to get outsized profits”

                begging the question of whether “the surrounding area” would “rush in with them to get outsized profits”. Maybe you could provide some examples of this actually happening, and of people saying “good thing they didn’t institute anti-gouging laws because otherwise I wouldn’t have bothered”.Report

        • Avatar DensityDuck in reply to Dark Matter
          Ignored
          says:

          “In most situations we have neither infinite supply nor infinite demand.”

          You are right, my friend, you are absolutely right, except that when you make statements like “If we let the market work and allowed prices to rise” you’re making a statement based on an assumption of infinite supply.

          “Further what is the definition of “works” here?”

          “works” being “the price accurately reflects both customers’ demand and suppliers’ cost of provision in a market where there exists infinite amounts of supply at a continuously-variable range of production cost”.

          That is, if you want price to be the mechanism by which resources are allocated efficiently then you need a market very close to the theoretical perfect one, with infinite supply and infinite suppliers whose operations act at all ranges of cost and are willing to come online as demand increases.

          This is not the case for a grocery store that only has twelve cases of toilet paper and they’re all on the shelf and they won’t get more before Tuesday.

          “If there’s a limited supply then prices stop being about the cost of provision and turn into a bidding war between buyers.”
          “Yes, and why is that a bad thing?”

          idontknowhowtoexplaintoyouthatyoushouldcareaboutotherpeople.jpg

          PS not gonna come back on that bit where you’re complaining about high prices? alrighty then!Report

      • Avatar Brandon Berg in reply to DensityDuck
        Ignored
        says:

        “If I’m totally out of toilet paper and need to spend many hours driving between stores…”

        time is money, sir, therefore you’re complaining about high prices (upside-down-smiley)

        The key difference here is that high cash prices are zero-sum. If a package of toilet paper costs $10 instead of $5, then your loss is the retailer’s gain. No real resources are consumed as a result of the higher prices. If you spend two hours driving all over town to find toilet paper, that’s negative-sum. Nobody gets the time you wasted, nobody gets the gas you burned, and nobody’s car gets an extra 20 miles added to its useful life because of the 20 miles you put on your car. It’s pure waste.

        People driving from store to store trying to find out-of-stock items is a bad outcome, and a perfect example of why price controls are bad.Report

    • Avatar LeeEsq in reply to Dark Matter
      Ignored
      says:

      The argument against price gouging is that it allows those with money to hoard while preventing those without money from buying necessary supplies because they can’t afford it. The assumption is that price gouging will simply cause everybody to engage in more rational buying than hoarding. But a person making mid six figures is going to feel less of sting on an increased price of toilet paper than somebody making in the mid five figures. In order to prevent hoarding among the more affluent, you need to raise prices to where even the less affluent can’t afford a reasonable amount. Rationing is a better solution because it can be imposed equally.Report

      • Avatar Dark Matter in reply to LeeEsq
        Ignored
        says:

        The argument against price gouging is that it allows those with money to hoard while preventing those without money from buying necessary supplies because they can’t afford it.

        At the moment we’re allowing everyone to hoard, resulting in empty shelves.

        The assumption is that price gouging will simply cause everybody to engage in more rational buying than hoarding.

        Not “everyone”, but enough.

        In order to prevent hoarding among the more affluent, you need to raise prices to where even the less affluent can’t afford a reasonable amount.

        We don’t need to prevent hoarding by everyone.

        Rationing is a better solution because it can be imposed equally.

        We don’t have “rationing”, that implies there’s some way to allow everyone to have some (or the same) amount of some resource.

        What we have is “shortages”, where people who might seriously need something have nothing.Report

      • Avatar Brandon Berg in reply to LeeEsq
        Ignored
        says:

        FYI, there’s a very strong expert consensus that so-called “price gouging” laws are a bad idea.Report

  5. Avatar DensityDuck
    Ignored
    says:

    Panic-buying makes a little more sense when you’re in California and they’ve issued a Shelter In Place order for most of the state. It’s not that the store will run out of things, it’s that I won’t be allowed or able to get there…Report

  6. Avatar Chip Daniels
    Ignored
    says:

    Here in California businesses that sell food, shelter and “essential” services are allowed to remain open, as are gas stations, and daycare centers.

    So even though we are sheltering in place its still possible to go to the grocery store for essentials.Report

  7. Avatar Kristin Devine
    Ignored
    says:

    Oh and great piece BTW!Report

  8. Avatar Urusigh
    Ignored
    says:

    “If we let the market work and allowed prices to rise, then we would see less pointless hoarding and less people running out of toilet paper.”

    Counter-argument: we would see exactly the same hoarding, except the distribution of who is out of toilet paper would be less random (first come first served) and more proportional by income. Price rise is normally a valuable signal to draw additional resources to the affected area, but not particularly useful in the current context since the shortages are effectively nationwide and the constraint isn’t so much production (there really is enough TP manufactured to meet the physical need for it) as transportation capacity to meet this temporary surge in demand. By the time trucking can scale up sufficiently, the surge in demand is likely to be ending anyway. The smarter fix here would have been temporary rationing (x units of product per customer) which would actually reduce the number of people running out. Price gouging on TP wouldn’t accomplish anything more than an unnecessary wealth transfer up the income scale (demand for TP has a hard floor since even poor people can’t readily substitute or do without).Report

    • Avatar Dark Matter in reply to Urusigh
      Ignored
      says:

      Counter-argument: we would see exactly the same hoarding, except the distribution of who is out of toilet paper would be less random (first come first served) and more proportional by income.

      My assumption is the rich are already hoarding to the same level as the poor.

      Reducing the level of hoarding would therefore reduce the level of hoarding.Report

      • Avatar Urusigh in reply to Dark Matter
        Ignored
        says:

        “My assumption is the rich are already hoarding to the same level as the poor.”

        I doubt it, but I’ll accept that assumption for sake of this debate. Nonetheless, my counter-argument was that price gouging would NOT reduce the level of hoarding. The rich and poor both hoarding is bad, agreed, but the rich hoarding while the poor go without would be even worse. You simply can’t raise the price of a necessity like TP enough to matter to the upper class without completely pricing the poor out of the market. I.E. If it was a food shortage, the rich people used to paying $50 a meal for imported Kobe steak or whatever wouldn’t blink twice at a 10x price increase forcing them to eat formerly $5 fast food value meals instead, but the poor people used to living on those $5 value meals certainly couldn’t afford to pay the new $50 price and would thereby starve. The better answer in such (temporary) circumstances is enforced rationing, not price gouging.Report

        • Avatar Dark Matter in reply to Urusigh
          Ignored
          says:

          my counter-argument was that price gouging would NOT reduce the level of hoarding.

          You seem to be assuming that, with everyone trying to get an extra two months’ worth of TP, that if we raise prices the rich will take up the slack and hoard several more years worth. That seems doubtful.

          Further one of the big things driving the hoarding at the moment is empty shelves. Raise the price enough that there is less hoarding and the shelves will have some which will drive down hoarding even more.

          You simply can’t raise the price of a necessity like TP enough to matter to the upper class without completely pricing the poor out of the market

          True, but irrelevant. There aren’t enough rich people to matter.

          The best answer in such (temporary) circumstances is enforced rationing, not price gouging.

          That at least is a solution which attempts to make sense, but we don’t have that. What we have is price controls without rationing.

          For your food example, rather than let some people pay more for food which would make poor people starve, we’ve decided that the suppliers of food and transporters of food can’t be allowed to benefit from this so random people need to starve.

          My expectation is in that example “rich” and “poor” wouldn’t be a binary thing and “desperate enough to pay 10x for food” would often track well with “desperate for food”, which implies random is actually a lot worse than money even in that case.Report

          • Avatar Urusigh in reply to Dark Matter
            Ignored
            says:

            “You seem to be assuming that, with everyone trying to get an extra two months’ worth of TP, that if we raise prices the rich will take up the slack and hoard several more years worth. That seems doubtful…. There aren’t enough rich people to matter.”

            This is where we disagree. I’m assuming that even many of the rich were caught off guard by the panic buying (e.g. the super-rich can just fly elsewhere or otherwise sidestep the usual supply chains, but the more common upper-middle class kind of rich can’t afford using a private jet just for TP, so they’re still stuck with empty shelves like the rest of us until the next shipment comes in). I’m not betting that those guys already got their 2mo supply and would soak up cost increases to make it a 2yr supply, I’m betting that if price raises forced the poor not to hoard there’s enough not-poor people who don’t yet have a 2mo supply to still empty the shelves (for now). For the price range TP could possibly top out at and still be even possible for poor people to buy, there ARE enough rich people to matter.

            “That at least is a solution which attempts to make sense, but we don’t have that. What we have is price controls without rationing.”

            Which is neither here nor there, we don’t have price gouging either. I’m not defending the current half-ass too-late measures, I’m debating what the response “should” have been, which is local rationing and price control. Once the minimum need is met you could auction or lottery the remainder of the supply for all I care. If this were going to be a long-term issue, sure, some price rises might make sense, but they don’t when the rate of consumption hasn’t changed and isn’t going to change significantly. Eventually everyone who wants a 2mo supply is going to have it even under price controls.

            “For your food example, rather than let some people pay more for food which would make poor people starve, we’ve decided that the suppliers of food and transporters of food can’t be allowed to benefit from this so random people need to starve.”

            Last I heard grocery workers and truckers didn’t get a pay raise and aren’t likely to, so when you say “supplier/transporters of food” all I’m hearing is “food company shareholders”, not the workers. I’m unclear how you think a scenario where the exact same number of people die is made any better rather than worse by transferring more wealth from the survivors to people who did nothing different than business as usual. Price gouging is only useful when it incentivizes an increase in supply to meet the demand, but that isn’t possible in the given situation and timescale because available supply chain and transportation capacity is already maxed out and neither the demand spike or possible profit margins (even with price gouging) are high enough to cover the capital investment that would be necessary to do something long-term like buy more rigs. Price gouging wouldn’t work and the outcome of the attempt would be less morally acceptable than that under rationing or price controls.Report

            • Avatar Dark Matter in reply to Urusigh
              Ignored
              says:

              I’m betting that if price raises forced the poor not to hoard there’s enough not-poor people who don’t yet have a 2mo supply to still empty the shelves…

              I disagree. Make tp 4x the cost and you have to wonder what you’re paying for, that would certainly make me wonder if I really need it. The thing about the current situation is there’s no opportunity cost. I got a 2 month supply, if it sits on a shelf then it sits on a shelf. Ditto the $150 in cans of tuna. Double or triple those prices and you’d be making me pay for my insecurities.

              And mostly the rich didn’t get rich by being foolish with money.

              I’m debating what the response “should” have been, which is local rationing and price control.

              I have to say that would be better than what we have now, and I’d be good with it in the context of an emergency… however I’m not sure if I should be. There are arguments that rationing is simply an emotional reaction and is both a sub-standard outcome and a misuse of gov power. As much as this may feel like a “limited spots on the lifeboat” situation, it’s not. And given how easily and poorly politicians virtue signal with this authority I question whether or not they should have it.

              If this were going to be a long-term issue, sure, some price rises might make sense,

              This argument totally fails when I try to apply it to the more obvious and serious short term imbalances, say the drug store which needs a $10k generator to stop a million dollars worth of product from going bad. It comes down to “sure, he loses a million dollars worth of product but our politicians get to virtue signal and besides, we’re all in this together”.

              My expectation is during an emergency having efficient distribution of scarce resources is more important, not less.

              Last I heard grocery workers and truckers didn’t get a pay raise and aren’t likely to, so when you say “supplier/transporters of food” all I’m hearing is “food company shareholders”, not the workers.

              And your point is what? That companies that are unexpectedly important shouldn’t make money? That we don’t want them to be able to hire more workers (or replace ones who are sick) or expand? That we don’t want them to capture outsized profits because that might lure other individuals/companies into this space?

              I’m unclear how you think a scenario where the exact same number of people die is made any better…

              Inefficient allocation of resources is a good way to have more people die.

              Price gouging is only useful when it incentivizes an increase in supply to meet the demand

              This is silly wrong on the face of it. Let’s go back to the whole generators-after-a-hurricane thing. With no power everyone wants a generator, but everyone doesn’t benefit equally from one. The guy who would benefit the most is the one trying to save his stock of food/drugs/whatever and needs to keep his refrigerators running.

              No price gouging means first come first served, i.e. shortages, and it’s making a bad situation worse because that guy’s stock spoils.Report

              • Avatar Chip Daniels in reply to Dark Matter
                Ignored
                says:

                This whole discussion is occurring in an airless vacuum of hypotheticals and theory, proceeding from “expectations” ,creedal ideology and assuming a false dilemma, i.e., “shortage” vs “price gouging”, as if other options aren’t in place and used regularly already.

                At the federal, state, and local levels, there are emergency planning and management organizations that are able to respond immediately to move supplies and personnel to the areas affected by natural disasters.

                This isn’t a theory, or hypothetical construct; Its an actual thing that happens and can be measured and evaluated.

                And we’ve seen real world evidence of both successes and failures (Heckuva job Brownie).

                What the real world evidence shows is that emergencies demand forward planning and preparation above all. The time to think about generators is long before the hurricane; the time to stockpile water is before an earthquake.

                And above all else, success or failure depends on logistics; Managing the flows of information and people and materials, which demands a centralized, coordinated, top down command and control model.

                This is proven time and again by the military. There is no decentralized crowdsourced entrepreneurial model for emergency logistics.Report

              • Avatar Dark Matter in reply to Chip Daniels
                Ignored
                says:

                What the real world evidence shows is that emergencies demand forward planning and preparation above all.

                This is very true…

                “shortage” vs “price gouging”, as if other options aren’t in place and used regularly already.

                We’re having this discussion because in many places the shelves are currently empty.Report

              • Avatar Chip Daniels in reply to Dark Matter
                Ignored
                says:

                Why are the shelves empty?

                Were the stores not able to increase prices?
                Why, yes they were!

                The stores could easily have chosen to raise prices to astronomical levels if they wanted to.

                And I suppose the shelves would still have some rolls of toilet paper.

                But…would the supply be larger?
                Not even by a single roll, because the suppliers haven’t changed to meet the sudden demand.

                Would people who need toilet paper be without it?
                Yes, yes they would!

                So I’m struggling to see how price is the solution here.

                You aren’t describing a scenario by which goods are allocated better than they are now. In both the status quo, and your price gouging scenario, the end result is the same, where some people have it, and some people don’t.

                The only difference is that in the status quo, the people who have it are the clever ones who rushed out faster than everyone else;
                In your scenario, the people who have it are the ones with money.

                I’m not seeing why either scenario is the one we should find satisfactory.Report

              • Avatar Dark Matter in reply to Chip Daniels
                Ignored
                says:

                Were the stores not able to increase prices? Why, yes they were!

                Actually no, they were not, not without opening themselves up to being arrested by the state because “price gouging” is illegal.

                Would people who need toilet paper be without it? Yes, yes they would!

                The word “need” is doing a LOT of heavy lifting here.

                If someone is desperate enough to pay 3x the normal price because they currently have none, then at the moment they can’t. However most of the people who are currently buying paper are NOT that desperate.

                But…would the supply be larger? Not even by a single roll, because the suppliers haven’t changed to meet the sudden demand.

                True, the supply would not be larger, but presumably it would be more efficiently distributed. That means less runs on stock, less panic buying, less shortages, and that desperate person who has nonething would be able to pay 3x and actually get his.

                You aren’t describing a scenario by which goods are allocated better than they are now.

                Actually I am. Markets and letting prices rise is how goods are efficiently allocated. We’ve spent multiple centuries figuring this out, it’s extremely well established and researched.

                The only difference is that in the status quo, the people who have it are the clever ones who rushed out faster than everyone else;

                That would be me btw. When I realized shortages were comming I stocked up.

                In your scenario, the people who have it are the ones with money.

                In my scenario there would still be product on the shelves.

                So I’m struggling to see how price is the solution here.

                That’s because you reflexively don’t like markets or see their use.Report

              • Avatar Chip Daniels in reply to Dark Matter
                Ignored
                says:

                No, no one was afraid of “being arrested” over price increases.

                But you are absolutely correct, “need” is doing all the work here.

                What you’re doing is taking a sensible idea- that people’s willingness to pay reflects their need- and extending it out in all directions beyond any absurd limit.

                This idea is perfectly reasonable, but only within limits.
                If I refuse to pay a bit extra for a soda, its reasonable to think its because I don’t want one very much;
                It’s reasonable to say that the goods in this case are allocated efficiently.

                But- if a rural hospital refuses to pay a million dollars for a ventilator, and it gets purchased by a Russian billionaire “just in case”, it isn’t because the hospital doesn’t want one badly, its that they don’t have a million dollars.
                In this case it would be ludicrous to say that the goods are allocated efficiently.Report

              • Avatar Dark Matter in reply to Chip Daniels
                Ignored
                says:

                No, no one was afraid of “being arrested” over price increases.

                Are you seriously claiming “price gouging” isn’t illegal?

                What you’re doing is taking a sensible idea- that people’s willingness to pay reflects their need- and extending it out in all directions beyond any absurd limit.

                What you are doing is trying to claim limits based on imaginatary situations that don’t “feel” right without presenting better alteratives.

                A better example would be the lifeboat classic, i.e. the ship is going down and the lifeboat can only save half. However our current reality seems to be more of a market being poorly regulated by the gov than a life boat.

                But- if a rural hospital refuses to pay a million dollars for a ventilator, and it gets purchased by a Russian billionaire “just in case”, it isn’t because the hospital doesn’t want one badly, its that they don’t have a million dollars.
                In this case it would be ludicrous to say that the goods are allocated efficiently.

                Sure, for this individual transaction which is carefully cherry picked and fictional and seems to have a foreign McDuck as the villian of the piece. However in the real world efficiency is measured by looking at the total market, not individual transactions.

                And what is your alternative, an omnipresence omniscient omnibenevolent state agency that will carefully review every transaction to make sure it “feels” ok? If that’s what you want then your fictional example of well connected insiders taking advantage is WAY closer to typical in the real world examples we have than in anything close to a market.Report

              • Avatar Chip Daniels in reply to Dark Matter
                Ignored
                says:

                Well, first:
                https://www.themoscowtimes.com/2020/03/21/exclusive-rich-russians-are-hoarding-ventilators-to-protect-themselves-against-the-coronavirus-a69703

                But really, you aren’t familiar with the ways that various emergency entities- everything from FEMA to the National Guard, from the Red Cross to state and local emergency response teams- all act in the aftermath of disaster to provide things like food, shelter, generators and water?Report

              • Avatar Dark Matter in reply to Chip Daniels
                Ignored
                says:

                RE: Russians
                You’re pointing to a country where the ruling elite have dismantled the market and use the gov to maintain their power via their insider connections. So your solution is what… to dismantle the market and trust that our gov won’t do the same?

                But really, you aren’t familiar with the ways that various emergency entities- everything from FEMA to the National Guard, from the Red Cross to state and local emergency response teams- all act in the aftermath of disaster to provide things like food, shelter, generators and water?

                First, these groups are to be applauded for their efforts. They’re the first line of defense and for the most part they do a good job. However if they’re really doing their jobs then there won’t be a market for 10k generators and the like, and there won’t be empty shelves and the like.

                Now where are you going with this? Are you suggesting we don’t need to worry about empty shelves and 10k generators because these groups will prevent it from happening?

                If that’s the case then there’s no need to pass laws against or discourage price gouging, becuase the later would only happen if these organizations drop the ball or aren’t up to the task or something.Report

              • Avatar Chip Daniels in reply to Dark Matter
                Ignored
                says:

                “… a country where the ruling elite have dismantled the market and use the gov to maintain their power via their insider connections.”

                Uh…was that meant to be sarcastic?

                But you raise a good point, that if emergency agencies are doing their jobs right, the need for price gouging would be reduced or eliminated.

                Which I suppose is a good rationale for a robust and well managed emergency system.Report

              • Avatar George Turner in reply to Dark Matter
                Ignored
                says:

                We have that in 36 states, where hospitals can’t add beds or ventilators without state or local approval (a “certificate of need”) so that hospitals don’t face too much competition or end up with overcapacity.

                I mean, if the hospitals bought ventilators they didn’t really need, then it stands to reason that the patients will end up having to pay extra for them, and “that’s just not right.”Report

              • Avatar Dark Matter in reply to George Turner
                Ignored
                says:

                A wonderful example of the lack of markets in the HC system.Report

              • Avatar Brandon Berg in reply to Chip Daniels
                Ignored
                says:

                This whole discussion is occurring in an airless vacuum of hypotheticals and theory

                Maybe you and some like-minded individuals can petition the school board to have an “supply and demand is just a theory” sticker added to every economics textbook.Report

              • Avatar greginak in reply to Brandon Berg
                Ignored
                says:

                Wait wut? Do people think hospitals would have been spending millions on adding all sorts of tech/beds as surge capacity in case of pandemic. That is bizarre. They are businesses and don’t have extra giant piles of money around for that. There is a crit of C of N and supply and demand is just fine, but this ain’t it. Where is there any evidence hospitals would have piled up everything needed to prepare for this kind of situation if not Cof N. This is beyond what businesses can be prepared for. S and D is not a simplistic explanation for everything. It matters but it far from explaining all the dynamics of most things and a case like this.Report

              • Avatar Dark Matter in reply to greginak
                Ignored
                says:

                You are trying to argue the market can’t possibly work, presumably you’re heading for “the gov needs to step in”.

                I’m going to quote George here:

                …in 36 states, where hospitals can’t add beds or ventilators without state or local approval (a “certificate of need”) so that hospitals don’t face too much competition or end up with overcapacity.

                The current reality is the gov has created this situation.

                When we look at parts of the medical HC industry where the gov has less influence (lasik, plastic), the supply tends to be much higher and the price much lower.Report

              • Avatar greginak in reply to Dark Matter
                Ignored
                says:

                I saw the quote. I see resonable crits of C of A. I said that. Markets aren’t magic. They are good at somethings less so at others. I cannot see any rationale for businesses, private or non profit, spending huge amounts of money on gear/supplies for every possible emergence situation. Hosps do some already but do you really think they will have prepared for having all the extra ventilators for something like this. That makes no sense at all if you look at as a business. Hosptials manage themselves. Gov is there to look at the big picture. We could have a Fed gov shifting supplies to areas that are being hit the hardest.

                Yeah gov has a role since it is there job to look at governing the country not meeting profit margins. They can stock up or make preps.

                Okay market you say. There is an act trump called on but so far has done anything about. It would empower teh Gov to spend and buy gigantic quantities of medical gear. Is that supply and demand? Is that gov doing something? Can two great tastes combine to make one even better taste? Well aside from a reeses peanut butter cup.

                Markets are good things. It is the biggest fans of them who think they solve every single problem that create the most unrealistic expectations about them. But then again it seems like markets can never fail unless we don’t hold enough pure faith in them.Report

              • Avatar Chip Daniels in reply to greginak
                Ignored
                says:

                I guess this is why I balk at the ideological usage of “markets” and “government” as if they are universal terms, undifferentiated and producing the same results throughout time and place.

                But as Russia and China show, governments and markets produce radically different results depending on where they operate.

                Markets in those countries have helped lift a billion people out of poverty, but they also don’t operate with anywhere near the efficiency or effectiveness of the ones in Europe and America.

                And not coincidentally, neither do the governments.

                So I would suggest that both markets and governments are only as efficient and effective as the society in which they operate.

                If the society is riven with corruption and incompetence, so also will be the markets and governments.Report

              • Avatar Dark Matter in reply to greginak
                Ignored
                says:

                I cannot see any rationale for businesses, private or non profit, spending huge amounts of money on gear/supplies for every possible emergence situation.

                It depends. This is a conversation I have, professionally, maybe every quarter.

                Detroit Automakers exist at one extreme. VERY large sales and throughput. Very low margins. “Just in time” manufacturing means very low inventory.

                Every few years we get some inventory manager from this sector/mindset and they try to “save” money by reducing inventory a lot. …which works up until we have a disruption and then we get hurt.

                At the other extreme are companies are the opposite of all that. High margins. Low sales. Low redundancy of manufacturing.

                If that’s your world then it makes a lot of sense to plan for surges and disruptions and to keep a lot of inventory on hand. The guy who runs inventory can save pennies by running it very lean, the company as a whole will lose millions if we can’t ship product.

                As for hospitals, my intuition is they’re a lot closer than us than to Detroit Auto. An empty hospital bed generates no profit, but the overhead on it is also very low and the profit you get when it’s full should more than make up the times when it’s empty.

                These anti-create-surge-beds regulations exist for a reason, and that reason is this reasoning would leds to hospitals trying to create more beds than they can use to deal with surges, and then they try to fill those beds by stealing patents from other hospitals. So in other words, those regulations exist to prevent competition.

                Gov is there to look at the big picture. We could have a Fed gov shifting supplies to areas that are being hit the hardest.

                Well then there is no problem. The all knowing, all benevolent government will simply handle it because clearly they can plan beyond the next election. The good news is they already largely run the HC system, so they should have already put in surge beds for this situation rather than outlawing them. The bad news is the whole “all knowing all benevolent” part which is needed to make this work well doesn’t seem to exist.

                it seems like markets can never fail unless we don’t hold enough pure faith in them.

                Markets can most certainly fail. Figuring out why, how and what to do about it gets interesting and informative.

                However here we’re looking at a lack of surge resources in combo with gov regs in most states saying black letter you’re not allowed to put in surge resources. The “failure” here seems obvious.Report

              • Avatar Stillwater in reply to Dark Matter
                Ignored
                says:

                The current reality is the gov has created this situation.

                This comment reminds me of all the libertarianish who argued – strenuously! – that government was the sole cause of the 2007 MBS collapse.Report

              • Avatar Road Scholar in reply to Dark Matter
                Ignored
                says:

                So according to that quote 36 states have CON regulations and 14 don’t. Be a fucking free-market hero and statistically compare the readiness of those two groups. Should be a no-brainer but I have yet to see such a comparison.Report

              • Avatar Dark Matter in reply to Road Scholar
                Ignored
                says:

                So according to that quote 36 states have CON regulations and 14 don’t.

                No, 36 states make it extremely obvious to the point of black letter.

                Our expectation should be that we don’t have anything like a functioning free market in any of them, and level of gov intrusion and micromanagement in all of them is beyond the point of absurdity.Report

              • Avatar Urusigh in reply to Chip Daniels
                Ignored
                says:

                “And above all else, success or failure depends on logistics; Managing the flows of information and people and materials, which demands a centralized, coordinated, top down command and control model.

                This is proven time and again by the military. There is no decentralized crowdsourced entrepreneurial model for emergency logistics.”

                This is generally true here, but not absolutely true. The usual “the neighborhood comes together in a time of crisis” story newspapers are so fond of is a common working example of “decentralized crowdsourced entrepreneurial model for emergency logistics”. It actually works faster and more efficiently than centralized models if the social trust/cooperation is high enough, information flow is adequate, and sufficient local resources are available. It simply doesn’t scale well in the absence of those factors, which is why it’s more often seen in tribal societies with strong extended family/clan structures than individualist societies like ours.

                Another exception is hybrid solutions with partial centralization, like GoFundMe, where the information is centralized and the response decentralized. I.E. The complaint earlier about driving around looking for stores that aren’t sold out doesn’t require centralized control of the supply to avoid, merely better information flow (.e.g. being able to check the websites or an app to see current store inventories before driving anywhere).

                None of which is to diss our military or emergency responders, for whom I have the highest respect, but simply to note that their organizational strength is usually more due to superior resources (time to plan and train in advance and capacity to stockpile) rather than necessarily any advantage in information or efficiency.Report

              • Avatar Chip Daniels in reply to Urusigh
                Ignored
                says:

                This is very true, and the examples of spontaneous small community action is in its own way, a refutation of the effectiveness of price gouging as a method of distributing resources.Report

              • Avatar Urusigh in reply to Dark Matter
                Ignored
                says:

                “I disagree…Double or triple those prices and you’d be making me pay for my insecurities. And mostly the rich didn’t get rich by being foolish with money.”

                Shrug. Then we aren’t going to agree on this point and I doubt we can find the RW data to settle it objectively anytime soon. See, I don’t consider it “foolish”, the rich don’t stay rich if they don’t hedge against negative events and even at 3x or 4x that’s an easy shift in disposable funds since most of the usual uses for excess cash just dropped off the table (fine dining, movies, sports tickets, etc).

                “There are arguments that rationing is simply an emotional reaction and is both a sub-standard outcome and a misuse of gov power.”

                So what are those arguments? I’m leery of gov power and political virtue signalling too, but that doesn’t change the underlying logic here.

                “drug store generator…My expectation is during an emergency having efficient distribution of scarce resources is more important, not less….Inefficient allocation of resources is a good way to have more people die.”

                Begging the question. You haven’t actually made a case that price gouging is the most efficient distribution of scarce resources. It’s just as easy to point out that relying on price means the rich suburb nearby buys up all the generators and the drug store still doesn’t get one. Those who need a thing the most are not necessarily those who can afford to pay the most. Price gouging “may” discourage hoarding, rationing always prevents it.

                “And your point is what? That companies that are unexpectedly important shouldn’t make money?”

                They are already making money. No company selling TP has LOST money constantly selling out of product as fast as they can get it on the shelves. The moral argument for price gouging is that it maintains a profit incentive while covering the additional costs for producing more/shipping further, neither of which apply in this situation.

                “That we don’t want them to be able to hire more workers (or replace ones who are sick) or expand?”
                They are quite capable of doing that within their usual profit margin, especially when their sales volume is already maximized.

                “That we don’t want them to capture outsized profits because that might lure other individuals/companies into this space?”

                Into the space of “Toilet Paper Supplier”? Not possible. The
                potential added profits are quite limited in both time and scope, certainly not enough to justify the capital investment necessary for additional rigs or production facilities. Nor is this shortage a locally concentrated phenomena, so there’s no excess capacity out of the affected area to lure in, the “affected area” is everywhere.

                “The guy who would benefit the most is the one trying to save his stock of food/drugs/whatever and needs to keep his refrigerators running.”

                Price gouging doesn’t guarantee he gets it either. Frankly, nothing short of gov seizing the generator supply and doling them out directly guarantees a particular recipient gets one, but neither of us are arguing for that.

                “No price gouging means first come first served, i.e. shortages,”

                To borrow your own phrase, “This is silly wrong on the face of it.”. Rationing expressly limits shortages as much as possible by spreading the supply as widely as possible, price gouging merely shifts who gets to hoard up the income scale, it doesn’t necessarily prevent hoarding or shortages.

                A nationwide TP shortage due to a temporary spike in demand to hoard is fundamentally unlike a hurricane disaster response in every relevant specific.Report

              • Avatar Chip Daniels in reply to Urusigh
                Ignored
                says:

                One of the reasons arguments about price gouging tend to go in circles is that the libertarian argument that Dark Matter is using here has a different set of premises and definitions than those used by conservatives and liberals.

                Here, the libertarian definition of “efficient allocation of resources” is used in it narrowest economic sense, where the “need” for something is synonymous with “economic demand” , i.e., price.

                So the guy who pays ten dollars has a greater “need” than the guy who is only willing to pay five. Therefore, the goods are allocated efficiently according to the greatest “need”.

                But for the rest of us, this definition of “need” is absurd.
                The first guy may be buying it for frivolous reasons, while the second guy may die without it but from an economic standpoint, those concerns are irrelevant.

                The equating of “need” with willingness to pay means that it doesn’t matter who the buyer is, or what their motivation.

                An example might be if the government steps in and buys up all of the resource, using the massive power of its public purse, then hoards the resource for government officials and cronies.

                From an economic standpoint, this is no different than a rich oligarch doing the same thing.Report

              • Avatar Dark Matter in reply to Chip Daniels
                Ignored
                says:

                So the guy who pays ten dollars has a greater “need” than the guy who is only willing to pay five. Therefore, the goods are allocated efficiently according to the greatest “need”.

                But for the rest of us, this definition of “need” is absurd. The first guy may be buying it for frivolous reasons, while the second guy may die without it but from an economic standpoint, those concerns are irrelevant.

                So the 2nd guy WILL DIE without this but is only willing to pay five dollars, and he’s priced out of the market at ten dollars, and the first guy doesn’t actually need it.

                And this because this market isn’t working correctly(?), we’re supposed to reach for the better alternative, which is… someone in authority will decide who gets what according to ethical standards?

                The equating of “need” with willingness to pay means that it doesn’t matter who the buyer is, or what their motivation.

                It does however avoid needing telepathy or an all knowing entity to figure out who should be allowed to buy what.

                It also avoids needing an ethical gut check (which varies from person to person) on every transaction.

                It also has a ton of theoretical backing (and RL observation) in terms of maximizing human good, minimizing transaction overhead and so forth.

                If the only thing you have going for your argument is the purity of your motivation and the impurity of the other guy’s motivation, then maybe it’s because you don’t have an argument.Report

              • Avatar Chip Daniels in reply to Dark Matter
                Ignored
                says:

                Well, to my example, if the government just cleared the market by outbidding everyone else and bought every single generator, would that be an “efficient” allocation of resources?

                Because whats interesting is that this definition of “efficient” doesn’t have any variable as to how the generators are used.

                Presumably, once they are purchased, they are allocated efficiently, whether they create power or just sit in a warehouse.Report

              • Avatar Urusigh in reply to Chip Daniels
                Ignored
                says:

                “One of the reasons arguments about price gouging tend to go in circles is that the libertarian argument that Dark Matter is using here has a different set of premises and definitions than those used by conservatives and liberals.”

                Thanks Chip. I thought some weird equivocation was going on. That definition of “efficient” doesn’t even match the “generator for the drug store” example since the store owner’s willingness to pay higher prices to avoid massive losses from spoiled stock still runs into the practical limit of his available funds, which is to say that while anyone might theoretically be willing to pay an infinite amount for a necessity of life, how much each actually can pay is a variable independent of “need”. The spendthrift millionaire who just wants to keep his AC running can still outbid the drug store owner, but I don’t see how letting millions in drug store stock spoil for lack of a generator meets even the most narrow definition of “economic efficiency”. It’s a flawed argument even on its own terms.Report

              • Avatar Dark Matter in reply to Urusigh
                Ignored
                says:

                What you’re saying here is that because clearly markets don’t work and especially don’t promote efficiency, markets must not work and not efficiency.

                The problem with all this “what if” counter examples is that for the most part it’s not a thing in the big picture, nor do you have a better way to handle this sort of thing.Report

              • Avatar Urusigh in reply to Dark Matter
                Ignored
                says:

                “What you’re saying here is that because clearly markets don’t work and especially don’t promote efficiency, markets must not work and not efficiency.”

                Uh, what? I’m not discussing a big picture. AFAICT you and I are generally in the same ballpark on big picture economic questions. I’m mostly happy with free markets. Heck, even most of the lefties around here are pretty cool with “free” markets, such that our disagreements are more about “whether” a given market is currently “free” and therefore whether a given proposed intervention has a net effect of greater freedom vs less freedom (they usually want more intervention and I want less). So I think you’re projecting a greater difference of opinion on me than we actually have.

                That said, “price” still != “economic efficiency”. It’s a generally useful proxy/signal in most contexts, but it’s not the thing itself. E.G. asset bubbles reflect a temporary disconnect in the market between current price and actual economic value; this is in fact a characteristic of durable goods with potentially higher resale value, which under the current context would include TP and certain foodstuffs. One reason why emergencies often require a change from default free market behavior is that the circumstances temporarily change the relevant category of certain goods (i.e. TP rolls and foodstuffs do not have a potentially higher resale value under normal conditions so they do not need to be treated as assets subject to appreciation under normal conditions,
                whereas necessities do function as appreciating assets during an emergency shortage, so they need to be treated as such for the duration in order to avoid bubbles (which are inherently economically inefficient). You see price gouging here as a market correction, I see it as a market distortion (bubble), hence our disagreement as to whether preventing it increases or decreases efficiency.

                In microeconomics, economic efficiency is, roughly speaking, a situation in which nothing can be improved without something else being hurt. If we’re going to simplify, I’d say that “efficiency” is more closely related to “productivity” than “price”. In your example, The Drug Store “should” get the generator instead of the millionaire because it will be used more productively there. Neither of our proposals guarantee that outcome though, because only coercive power could force it and neither of us are inclined to trust the judgement of anyone who might be given that coercive power.

                “The problem with all this “what if” counter examples ”

                ??? I haven’t offered any “what if” counter examples. The whole “Hurricane Generator for the Drug Store” example was your contribution, not mine. I was just talking TP until you threw that in there and you already admitted that in the particular current context my suggestion is a better (or at least acceptable to you) way to handle that thing.Report

              • Avatar Dark Matter in reply to Urusigh
                Ignored
                says:

                So what are those arguments? I’m leery of gov power and political virtue signalling too, but that doesn’t change the underlying logic here. … It’s just as easy to point out that relying on price means the rich suburb nearby buys up all the generators and the drug store still doesn’t get one.

                The argument is that markets are much better at efficient distribution of scarce resources than the alternatives. Our certainty of this is roughly the same certainty as for the law of gravity. If you’re trying to find a carve out situation where it doesn’t apply, then it’s on you to show there are situations where the law of gravity doesn’t work and not on me to show it does.

                The arguments against markets working seem to be highly emotional and speculative. Needing to argue against the evil selfish rich who don’t really need something is a good example.

                Those who need a thing the most are not necessarily those who can afford to pay the most.

                Yes, but the alternatives are “random”, “political connections”, and “rationing”. Rationing makes a lot of sense where the distribution of need is very well understood and the supply is large enough that it’s possible for everyone to get a little; So in the context of food and TP the arguments for rationing are stronger than normal, strong enough that I’d be fine with it in the current context.

                However everyone can’t have a generator so “rationing” is impossible. The gov stepping in to prevent outsized profit is NOT imposing sanity, it’s just virtue signalling… at the cost of reducing the supply and making sure the existing supply is used inefficiently.

                No company selling TP has LOST money constantly selling out of product as fast as they can get it on the shelves. The moral argument for price gouging is that it maintains a profit incentive while covering the additional costs for producing more/shipping further, neither of which apply in this situation.

                The entire supply chain is under huge pressure. Various transportation aspects are being asked to work overtime and so forth. Pointing to one part of that supply chain and self righteously proclaiming they can’t possibly use more money so the entire chain must not either doesn’t seem to be correct.

                Dark Matter: “That we don’t want them to capture outsized profits because that might lure other individuals/companies into this space?”

                Urusigh: Into the space of “Toilet Paper Supplier”? Not possible.

                No? It’s impossible to hire drivers to home deliver TP or that there might be a lot more demand for home delivery? It’s impossible for a TP supplier to want to hire expensive new delivery systems to speed things up and deliver to places that have shortages? We’re totally sure we want them to keep using their previous low bidder and possibly slow carriers? And if this crisis lasts for months, we’re sure there aren’t factories making similar products which can be repurposed?

                In the news on the radio was some company who is going to start making medical masks so clearly repurposing is a thing.

                But if we’re totally sure no part of the supply chain will get sick and find themselves quarantined, or is under unusual stress, and we’re totally confident that having extra money to sidestep these sorts of issues won’t be useful, then sure by all means wave a wand and freeze the market. There’s no need to let the market adjust to anything.

                To borrow your own phrase, “This is silly wrong on the face of it.”. Rationing expressly limits shortages as much as possible by spreading the supply as widely as possible, price gouging merely shifts who gets to hoard up the income scale, it doesn’t necessarily prevent hoarding or shortages.

                Our example in that part of the conversation is generators. “Ration” implies everyone gets a little. How do you intend to “ration” generators?

                Price gouging doesn’t guarantee he gets it either.

                In our example the price clearing generator sales price is $10k (this example was close to RL btw, we got some of these anti-gouging laws after the aftermath of a Florida hurricane and how generators where on “sale” for crazy high prices).

                I’m not sure why “guarantee” is now in the conversation nor what it means in this context. If you have a system which is better than the market in this situation, put it on the table. It is certainly possible the high bidder is McDuck and he has no use for the generator other than to count his gold, but in the real world the odds are that it’s someone who has economic use for it. The moment you assume an economic use for the high priced generator we’re deep into “let the market work”.

                A nationwide TP shortage due to a temporary spike in demand to hoard is fundamentally unlike a hurricane disaster response in every relevant specific.

                Every aspect but legally. The laws that are stopping a price spike here were developed for natural disasters. We have a lot more hurricanes than we do pandemics.

                I would be a lot happier with an exec order implementing rationing, but what we have is “no rationing” and “no price spikes”.Report

              • Avatar Urusigh in reply to Dark Matter
                Ignored
                says:

                “If you’re trying to find a carve out situation where it doesn’t apply, then it’s on you to show there are situations where the law of gravity doesn’t work and not on me to show it does.”

                I agree, but I’ve already done that and you’re still arguing. Unlike the usual natural disaster scenario the case of TP/food does not involve any actual destruction of existing supplies, the expected period of shortage is too short for repurposing/production upscaling to kick in in time, transportation is already temporarily maxed (or will adjust even at current prices since other business sectors have shut down, freeing up transportation capacity), and the global scope means that it’s not simply a matter of luring in out-of-area suppliers. I’m generally a free marketeer too, this is just a fairly unique situation and I’ve been repeatedly noting the specific constraints above that prevent rising price signals from having their usual effects. I am not arguing that price controlled rationing is always or even usually better than price rise (even in emergencies), merely that it is in this one specific unusual case.

                “So in the context of food and TP the arguments for rationing are stronger than normal, strong enough that I’d be fine with it in the current context.”

                Then we’ve reached agreement in principle. I’m not actually arguing anything but the current context.

                “I would be a lot happier with an exec order implementing rationing, but what we have is “no rationing” and “no price spikes”.”

                I haven’t read the exact text, but according to today’s headlines that seems to have just happened, though there’s still details to be worked out in implementation. https://thehill.com/homenews/administration/489125-trump-signs-executive-order-to-prevent-price-gouging-of-medical

                Thanks for an interesting debate.Report

              • Avatar Dark Matter in reply to Urusigh
                Ignored
                says:

                RE: Thanks for an interesting debate.

                You’re welcome.Report

              • Avatar DensityDuck in reply to Dark Matter
                Ignored
                says:

                “So in the context of food and TP the arguments for rationing are stronger than normal, strong enough that I’d be fine with it in the current context.”

                I think maybe this part here, where you agree with the rest of us, deserves a little bit more emphasis.Report

              • Avatar Dark Matter in reply to DensityDuck
                Ignored
                says:

                Bold? All Caps?

                Although I guess quoting it does a lot so thanks for that.Report

        • Avatar Stillwater in reply to Urusigh
          Ignored
          says:

          “My assumption is the rich are already hoarding to the same level as the poor.”

          The husband of a patient at my wife’s clinic accompanied his wife into the exam room and proceeded to open a briefcase packed full of the N95 masks (literally!) everyone in the world is clamoring for more of. My wife’s staff is currently limited to a total of one (1) mask not per-day, but which they have to re-use everyday.Report

          • Avatar Urusigh in reply to Stillwater
            Ignored
            says:

            Not sure why you addressed this reply to me rather than Dark Matter, it’s his assumption and I already stated I doubt it. I’m just letting it be in my debate with him because it’s not relevant to my argument that price gouging wouldn’t actually prevent the rich from hoarding. Thanks for the anecdote though, I was wondering whether they were hoarding more because they can afford it or less because they are less sensitive to perceived scarcity signals.Report

      • Avatar dragonfrog in reply to Dark Matter
        Ignored
        says:

        The rich are able to hoard on a whole different playing field.

        Working class people can induce short term localized shortages of toilet paper and toothpaste and stuff, which last only until distribution figures out the logistics of keeping enough of those things in the back room. Working class people can only get involved in supply chain wars with other working class people.

        Rich people can get involved in hoarding on a whole different playing field. They can get involved in supply chain wars with government and institutional purchasers. They can buy their own ventilators just in case someone in the mansion comes down with severe respiratory symptoms, removing them from the supply chain used by hospitals.Report

  9. Avatar George Turner
    Ignored
    says:

    Real Clear Politics linked a good piece on the outbreak that had lots of data, along with plenty of discussion about what the data seems to indicate.Report

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