Economic Shortage: Causes and Solutions
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Seven Economic Shortage: Causes and Solutions
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ast Fall in the Atlanta area we suffered from gas shortages. We were one of a few regions of the Southeast (also particularly Nashville and the Carolinas) that experienced a squeeze at the pumps due to Hurricane Ike (we have no local refineries, and our gas is trucked from one main pipeline that routes petrol from the gulf refineries that Ike shut down). Most stations within 60 miles of the city had no gas. Stations hurt not only due to decreased volumes of gas sold, but also due to decreased in-store sales since fewer people come in where there is no gas. This chapter offers a review of that situation and a solution to such a problem—not just a hind-sight’s 20/20 solution, but one based on classic free-market principles that would benefit store owners and consumers as well. Fear of prolonged shortages sparked panic, and thus heightened demand. As soon as a tanker arrived at a station, lines began to form and then remained until that station ran dry again. There were many stories of people following tankers to see where they arrived, and then buying gas where it unloads. (This makes me wonder how many people mistakenly followed milk, sugar, or liquefied fertilizer trucks thinking they were gas trucks.) On September 12, Georgia Governor Perdue signed an Executive Order outlawing “price gouging.”46 A state of emergency was declared and stations were forbidden from selling gas at Georgia governor Sonny Perdue www.AmericanVision.org