As Houston continues to deal with the devastation of Hurricane Harvey, Florida stands prepared for the impact of Irma. It is during times of crisis like this, when government feels the greatest need to control, that sound economics is most needed. This is why laws on “price gouging,” no matter their intent, bring tragic consequences. This is also how government intervention in insurance markets has only increased the costs of flooding. Unfortunately, there are still those who see the damage done by these storms as a good thing for the economy. Of course, such a dangerous misunderstanding of economics may qualify such pundits for one of the vacant Federal Reserve positions.
This post was published at Ludwig von Mises Institute on September 9, 2017.