Michigan Attorney General Dana Nessel

Michigan Attorney General Dana Nessel

(The Center Square) – Michigan Attorney General Dana Nessel has assembled a team of special agents to investigate potentially unlawful price increases on consumer goods and services during the coronavirus emergency, a practice commonly known as price gouging.

As of Monday, Nessel’s office has received more than 1,400 complaints related to price increases. Previously, the attorney general identified price gouging as at least 20 percent above normal retail prices.

“Our objective is to make sure business owners are following the laws Michigan has in place to protect consumers, and public awareness of price-gouging can offer valuable support in our efforts to keep companies honest,” Nessel said in a news release. “If that can be accomplished without legal action, then that is a path we will pursue. But if stores continue to disregard the rules and raise their prices beyond justifiable amounts, then we will hold them accountable.”

Referring to the team, a press release from the Attorney General’s office stated: “These men and women are highly trained criminal investigators and will help the office visit stores to evaluate details of consumer complaints, assist with online research to compare pricing, and receive phone calls or letters from consumers.”

Nessel’s office acknowledged the novel coronavirus outbreak “has caused some instability in the marketplace,” but asserted it also has caused “some artificial, and sometimes unlawful, price spikes.”

The AG’s news release urges consumers to “not buy in large amounts – or at prices – that are based in fear,” referring both to price gouging by retailers and hoarding by consumers.

“Fear is a powerful motivator,” Nessel said. “But working together, we can stabilize both the prices and the levels of supplies on our grocery store shelves.”

Not everyone interprets price increases as an inherently bad thing during such extraordinary circumstances as a pandemic. For example, James Hohman defends raising prices as an effective economic mechanism for ensuring those who wish to purchase consumer goods may do so while, at the same time, discouraging other consumers from hoarding the same products.

Hohman is director of Fiscal Policy at the Mackinac Center for Public Policy. In a conversation with The Center Square, Hohman said not all price increases in emergency situations should be considered gouging.

“People imagine that price increases in emergencies are because some shopkeepers are greedy,” Hohman said. “But they can also be used to keep products on the shelf when everyone else is out."

“Let's hope that the state isn't zealous about prosecuting people using emergency pricing if competitors don't have the goods available at cheaper prices,” Hohman said.

Regional Editor

Bruce Walker is a regional editor at The Center Square. He previously worked as editor at the Mackinac Center for Public Policy’s MichiganScience magazine and The Heartland Institute’s InfoTech & Telecom News.