Among the top priorities of the current and next Congressional sessions should be new laws to regulate corporate pricing policies. In particular, our nation needs strict new federal laws against price-gouging and predatory pricing.
We all know about price-gouging. We see it everyday when buying gasoline, diesel fuel, home heating oil, prescription drugs and many other products or services. Price-gouging is the result of an “all the market will bare” corporate mentality, as opposed to the more traditional “reasonable rate of return on investment” corporate mentality which prevailed in most corporate boardrooms before the 1980’s Reagan Revolution changed government policies and societal attitudes. This is the truly darkside of the Reagan Era. We are still suffering from the negative impacts as consumers and citizens.
Much of what is wrong with America developed out of the Reagan Era “greed is good doctrine.” It thoroughly corrupted the Republican Party and made serious inroads among elements of the Democratic opposition. It corrupted government policy and negatively influenced many average American citizens.
I believe we should return to the traditional Christian outlook that excessive greed is a serious sin. This is not just a Christian doctrine. Almost every religion and moral code developed around the world agrees that greed is usually an evil thing.
Excessive greed is what price-gouging is all about if you apply even a minimum of common sense to examining the issue. Greed is always present. It is why we have armed robberies, burglaries, piracy and scores of other criminal activities. Economic activities judged by society to be detrimental to most consumers, workers or other businesses are usually outlawed or at least heavily regulated by government. It is clear that price-gouging falls into this category of detrimental economic activity. It should be banned.
Corporations that exploit market conditions to abuse consumers should face huge fines. The fines should be multiples of all profits derived from the price-gouging. Zero profits should be retained by those corporations from the price-gouging activities. There is a legal pattern in much of American government regulation of corporate misbehavior that actually permits the corporations involved to retain large portions of illegally obtained profits. This must be stopped.
Corporate executives who are responsible for price-gouging consumers should face long mandatory jail terms. There should be no parole options. The dollar amounts involved should be reflected in the length of the jail terms imposed. The personal assets of those executives should be seized as well as art of the punishment for illegal price-gouging.
It is time to get tough on corporate criminals. These corporate criminals are undermining the health of the American economy, crippling the finances of hundreds of millions of American citizens and undermining our long-term national security for their personal gain. They are truly bad citizens.
Predatory pricing is the tactic of temporarily selling below cost products or services just to drive competitors out of business. After smaller competitors are driven out of business, the predators can then raise prices to price-gouging levels since consumers can no longer buy from the now bankrupt small competitors. Chain stores often use this tactic to destroy local businesses. Corporations like Wal-Mart have the economic ability to destroy small competitors in one small town after another because they have hundreds or thousands of other stores located outside the local market to subsidize the predatory behavior in the local market.
Many states have laws against predatory pricing but not all states. It is time to make the legal prohibition national in scope. It is time to adopt penalties for predatory pricing that are very similar to those I propose for price-gouging.
American consumers and small businesses deserve a fair playing field that promotes economic morality and fair competition. They deserve true economic justice. It is time for the nation to turn our backs toward the Reagan Era “greed is good” ethos and return to our traditional values.
Written by Stephen Crockett (co-host of Democratic Talk Radio www.democratictalkradio.com/ and Editor of Mid-Atlantic Labor.com www.midatlanticlabor.com/ ).