Business News 

Price Gouging Legislation "Gratuitous and Misguided"

Says Small Business Group

"Would only make matters worse"

Washington, D.C.  - The Small Business & Entrepreneurship Council (SBE Council) issued a stinging criticism of U.S. House passage of legislation directed at so-called "price gouging" when it comes to gasoline.  According to the group, this action is probably one of the more gratuitous and misguided approaches to energy policy, rivaling price controls in the late 1970s.

Karen Kerrigan, president & CEO of SBE Council, stated: "This so-called ‘price-gouging' bill is one of the more useless and dangerous actions by the Congress that will do nothing to lower gas prices. Unfortunately, it would cause serious problems if it actually became law.  It completely ignores the economic realities of energy markets.  And given its necessary vagueness - after all, no one knows what ‘price gouging' actually is - such legislation would create a bonanza for trial lawyers."

SBE Council chief economist Raymond J. Keating noted: "Price gouging legislation seeks to replace the market with the whims of politicians.  The workings of the marketplace - including supply responses to higher prices and profits - would be disrupted, thereby creating more problems, including shortages.  When government sets prices, it never turns out well for consumers, including for the countless small businesses across the nation that obviously use gasoline."

Kerrigan added: "Perhaps lawmakers should take a look at the roles they have played in the problems that plague energy markets, including, for example, the failure to open up parts of the United States, including ANWR, to energy exploration and development, and assorted taxes. Price gouging may give politicians something to brag about during the upcoming Congressional break, but it won't solve the core issues facing our nation with respect to energy costs and supply."

For more than a decade, the SBE Council, a nonpartisan, nonprofit small business advocacy group, has been working to protect small business and promote entrepreneurship.  SBE Council can be contacted at 703-242-5840. For additional information, please visit: http://www.sbecouncil.org/.

# # #