Excerpt of Justice by Michael J. Sandel
(Page 2 of 8)
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Attorney General Crist (a Republican who would later be elected
governor of Florida) published an op-ed piece in the Tampa paper defending
the law against price gouging: “In times of emergency, government
cannot remain on the sidelines while people are charged
unconscionable prices as they flee for their lives or seek the basic commodities
for their families after a hurricane. Crist rejected the notion
that these “unconscionable” prices reflected a truly free exchange:
This is not the normal free market situation where willing buyers
freely elect to enter into the marketplace and meet willing sellers,
where a price is agreed upon based on supply and demand. In an
emergency, buyers under duress have no freedom. Their purchases of
necessities like safe lodging are forced.
The debate about price gouging that arose in the aftermath of Hurricane
Charley raises hard questions of morality and law: Is it wrong
for sellers of goods and services to take advantage of a natural disaster
by charging whatever the market will bear? If so, what, if anything,
should the law do about it? Should the state prohibit price gouging,
even if doing so interferes with the freedom of buyers and sellers to
make whatever deals they choose?
Welfare, Freedom, and Virtue
These questions are not only about how individuals should treat one
another. They are also about what the law should be, and about how
society should be organized. They are questions about justice. To answer
them, we have to explore the meaning of justice. In fact, we’ve
already begun to do so. If you look closely at the price-gouging debate,
you’ll notice that the arguments for and against price-gouging laws
revolve around three ideas: maximizing welfare, respecting freedom,
and promoting virtue. Each of these ideas points to a different way of
thinking about justice.
The standard case for unfettered markets rests on two claims—one
about welfare, the other about freedom. First, markets promote the
welfare of society as a whole by providing incentives for people to
work hard supplying the goods that other people want. (In common
parlance, we often equate welfare with economic prosperity, though
welfare is a broader concept that can include noneconomic aspects of
social well-being.) Second, markets respect individual freedom; rather
than impose a certain value on goods and services, markets let people
choose for themselves what value to place on the things they exchange.
Not surprisingly, the opponents of price-gouging laws invoke these
two familiar arguments for free markets. How do defenders of price
gouging laws respond? First, they argue that the welfare of society as
whole is not really served by the exorbitant prices charged in hard
times. Even if high prices call forth a greater supply of goods, this benefit has to be weighed against the burden such prices impose on those
least able to afford them. For the affluent, paying inflated prices for a
gallon of gas or a motel room in a storm may be an annoyance; but for
those of modest means, such prices pose a genuine hardship, one that
might lead them to stay in harm’s way rather than flee to safety. Proponents
of price-gouging laws argue that any estimate of the general welfare
must include the pain and suffering of those who may be priced
out of basic necessities during an emergency.
Second, defenders of price-gouging laws maintain that, under certain
conditions, the free market is not truly free. As Crist points out,
“buyers under duress have no freedom. Their purchases of necessities
like safe lodging are forced.” If you’re fleeing a hurricane with your
family, the exorbitant price you pay for gas or shelter is not really a
voluntary exchange. It’s something closer to extortion. So to decide
whether price-gouging laws are justified, we need to assess these competing
accounts of welfare and of freedom.
Excerpted from Justice: What’s the Right Thing to Do by Michael J. Sandel. Published in September 2009 by Farrar, Straus and Giroux, LLC. Copyright © 2009 by Michael J. Sandel. All rights reserved.
