20070523 Congressman Roscoe Bartlett Votes No on “Feel Good, But Counterproductive” Price Gouging Bill

Congressman Roscoe Bartlett Votes No on “Feel Good, But Counterproductive” Price Gouging Bill

May 23, 2007

Washington, DC – Congressman Roscoe Bartlett voted against “the feel good, but counterproductive” Federal Price Gouging Prevention Act (H.R. 1252).

“Congress can’t suspend the economic laws of supply and demand,” said Congressman Bartlett. “This well-intentioned, but destructive bill, would take us back to the future of the 1970’s policies of Jimmy Carter that led to gasoline shortages, gas lines and rationing.”

The Federal Trade Commission found no evidence of price gouging from investigations after Hurricanes Katrina and Rita. Nowhere in H.R. 1252 are key terms such as “unconscionably excessive,” “unfair advantage,” “unreasonably,” “reasonably foreseeable,” “grossly exceeds,” “reasonably reflected,” “substantially attributable,” or “usual seasonal demand variations” defined explicitly. They are marked for emphasis in red italics.

H.R. 1252 would make it a federal crime for any person to sell, at wholesale or at retail in an area and during a period of an energy emergency, gasoline or any other petroleum distillate covered by a presidential proclamation at a price that is “unconscionably excessive” and indicates the seller is “taking unfair advantage of the circumstances related to an energy emergency to increase prices unreasonably.”

The bill would authorize the President to issue an unlimited number of 30-day energy emergency proclamations (one at a time) for any area within the jurisdiction of the United States, during which the price-crime provision above would apply. A proclamation, which could be issued up to one week in advance of a “reasonably foreseeable” emergency, would have to state the geographic area covered, the gasoline or other petroleum distillate covered, and the time period that such proclamation would be in effect.

In determining whether such a violation has occurred, the following factors would have to be considered:

whether the amount charged by a person for the applicable product at a given location in a proclamation-covered area:

“grossly exceeds the average price at which the applicable gasoline or other

petroleum distillate was offered for sale by that person during the 30 days prior

to such proclamation;

“grossly exceeds the price at which the same or similar gasoline or other

petroleum distillate was readily obtainable in the same area from other

competing sellers during the same period;

“reasonably reflected additional costs, not within the control of that person,

that were paid, incurred, or reasonably anticipated by that person, or reflected

additional risks taken by that person to produce, distribute, obtain, or sell

such product under the circumstances; and

“was substantially attributable to local, regional, national, or international

market conditions; and

whether the quantity of the applicable product the person produced, distributed, or sold in a proclamation-covered area during a 30-day period following the issuance of such proclamation increased over the quantity that that person produced, distributed, or sold during the 30 days prior to such proclamation, taking into account “usual seasonal demand variations.”

H.R. 1252 would also make it a federal crime for any person to report to a federal agency information related to the wholesale price of gasoline or other petroleum distillates “with actual knowledge or knowledge fairly implied on the basis of objective circumstances” that such information is false or misleading.

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