(The Center Square) – A North Carolina economist is calling on Gov. Roy Cooper to rescind price gouging laws in the wake of the COVID-19 outbreak.
Jon Sanders, the director of regulatory studies at the John Locke Foundation, said Monday increasing prices could slow down retail shortages. He wants Cooper to suspend anti-gouging protections enacted by Cooper’s March 10 emergency declaration.
Sanders also believes lawmakers should repeal the law. He said higher prices open the market to more suppliers and reduce hoarding.
“Price is information," Sanders said during the independent, nonprofit think tank's remote forum Monday. "It gives consumers how much an idea of how much something's in demand. How much people want it, like toilet paper right now. And also gives suppliers, or potential suppliers, how much toilet paper is needed right now.”
Cooper issued an emergency declaration March 10 in response to the coronavirus pandemic. The declaration triggered a consumer protection provision that allows the attorney general to monitor price inflations during the crisis. Ahead of the declaration, retailers had toilet paper on backlogs.
Attorney General Josh Stein brought seven lawsuits under North Carolina’s price gouging statute after hurricanes Michael and Florence hit the state in 2018.
“It is illegal to charge excessive prices during a state of emergency,” Stein said in March 10 statement. “If you see businesses taking advantage of this crisis, let my office know, and we will work to hold them accountable.”
Sanders said Monday raising prices will reduce consumers' fears of running out. It will bring short-term demand down and bring prices down sooner, he said.
“Allowing the price to adjust to this demand makes the price go higher, makes us think twice, ‘Well, do I really need three weeks supply of toilet paper? Maybe I can get by with two weeks,’ ” Sanders said.
The North Carolina Department of Health and Services on Monday reported 297 confirmed COVID-19 cases in the state.
COVID-19 is a respiratory disease caused by a novel coronavirus. The disease has caused at least 517 deaths in the U.S., with more than 42,000 confirmed cases in the country. COVID-19 symptoms appear within two to 14 days after exposure and include fever, cough, runny nose and difficulty breathing.
Most people who have it develop only mild symptoms. But some people, usually the elderly and those with other medical complications, develop more severe symptoms, including pneumonia, which can be fatal.