Seth Kaplan

Opinion contributor

The calls came not only from media and outraged consumers but also from my own family and friends in South Florida, where I grew up and lived most of my life.

“$2,000 for a flight to Denver, one way?” my mother-in-law texted to me.

Hurricane Irma was heading their way. Before long, airlines — JetBlue first, then others — felt shamed into dramatically lowering fares. JetBlue would charge as little as $99 for “any remaining seats in select markets,” that last part being the key phrase. I couldn’t find any seats for sale on the busy JetBlue routes I checked from Fort Lauderdale, although a few friends have confirmed they did, briefly but legitimately, see a few open seats.

One of those friends was Shannon Stout, a childhood friend from South Florida who now lives near Philadelphia. “Meanwhile another friend of mine spent $668 on a one way this morning!” she posted on Facebook.

My reply: “Honestly though, what’s worse: seats that are expensive but actually exist for someone who really needs them? Or $99 seats that are mostly imaginary?”

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Reasonable people can disagree about the answer. But the question has implications beyond the airline industry. Unlike gas stations (most of which have long since sold out of gas) or supermarkets (most of whose shelves are empty of water), airlines can plausibly claim that price increases at a time like this don’t constitute gouging, because airfares always vary relative to demand. Fares surged because of this potential catastrophe for the same reason they surge at happier moments, such as when people in one city learn their team will be going to the Super Bowl in another city: because there aren’t enough seats for everyone who wants to travel.

So airlines actually present an interesting test case for a policy that wouldn’t be popular— at least not at first — but might better serve the public. What if gas stations and supermarkets could significantly raise the price of gas and water without fear of reprisals, whether by regulators or outraged consumers? Right now, the first people to get to a gas station get all the gas (sometimes filling extra canisters for good measure), and the first people to get to a supermarket clear the shelves of water. A significant percentage of the gas purchased surely ends up sitting in the garages of people who don’t end up traveling anywhere until long after the storm, while other people have enough bottled water to bequeath to future generations. Meanwhile, others stuck in a panic without gas or water are thinking: “I would gladly pay double or triple the usual price right now.”

I realize there’s something distasteful about price increases in advance of a disaster. And unfortunately, as with all price increases, these would impact low-income consumers the most (because they have so little disposable income). But there’s also something distasteful about some people — however understandably — hoarding all the supplies while others, perhaps because they couldn’t quickly get away from caring for a child or elderly relative, are left without supplies. If merchants could, in an orderly way, raise prices to a point where people had to think about how much gas or water they truly need, those supplies could be rationed in a more equitable way.

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During a recent visit to Chicago, the Cubs charged me $9.25 for a can of Budweiser that would cost about $1 as part of a 12-pack at a supermarket. That wasn’t because there was a shortage of beer at Wrigley Field. That was purely because the Cubs calculated (correctly, it turns out) that I was willing to pay that amount.

Obviously, I didn’t need that beer, whereas my family and friends in South Florida need gas, water and airline tickets right now. But what happens at Wrigley Field and in so many areas of our lives —companies charging only based on demand, without any respect to what something costs to produce and even though there’s no shortage of supply — probably comes closer to a good definition of “gouging” than companies reacting to not only surging demand but a also shortage of supply.

No politician will get elected by adopting a pro-gouging platform. But sometimes, ideas with the broadest bipartisan support, such as anti-gouging laws, are well-intentioned and ill-conceived. In a situation where there are no good options — only bad ones and worse ones — a little “gouging,” to discourage hoarding, wouldn’t be the worst idea.

Seth Kaplan is managing partner of Airline Weekly, an industry publication, and author of the book Glory Lost and Found: How Delta Climbed from Despair to Dominance in the Post-9/11 Era.

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