Minimum Gas Prices


iconWhen it comes to high gas prices, Marylanders are getting screwed. Walter Williams takes a good look at Maryland's minimum gas prices and explains just who is protected by minimum pricing scams.

Here’s my no-brainer question to you: Do you suppose that Maryland enacted its gasoline minimum-price law because irate customers complained to the state legislature that gasoline prices were too low? Even if you had just 1 ounce of brains, you’d correctly answer no. Then, the next question is just whose interest is served by, and just who lobbied for, Maryland’s gasoline minimum-price law? If you answered that it was probably Maryland’s independent gas-station owners, go to the head of the class.
Minimum pricing is meant to protect smaller competitors from the large corporate owned chains. The theory is that corporations enter a market and undercut the small businessman to drive him out of business. Once that has been accomplished, they jack the prices back up and screw the consumers. So the politicians would have us believe that artificially inflated prices are actually good for the consumer because it keeps competitors in the market. If that sounds like a bunch of bullshit, that's because it is.

Williams also explains just how lawmakers get away with it.

Another reason legislators can get away with establishing these minimum-price laws has to do with another economic phenomenon called "narrow well-defined benefits and small widely dispersed costs." The beneficiaries of the gasoline seller collusion are relatively few in number and well organized. The victims, mainly gasoline customers, are difficult to organize, and the costs they bear are relatively small and widespread.

In other words, how many gasoline consumers would be willing to spend their time and energy fighting to unseat a legislator whose actions imposed, say, a nickel a gallon additional cost upon them?

It's amazing how expensive apathy can be. And that's not just for Marylanders either.
It’s joined by 12 other states, including New York, Michigan and Wisconsin. Wisconsin legislators have the gall to call its government-sponsored seller collusion the "Unfair Sales Act."
I disagree. The law sounds pretty unfair to me.



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