Friday, March 03, 2006
A gas station chain in Minnesota is being fined for "willful, continuing, and egregious" violations of the state's price law on gasoline.
Do I hear shouts of "About time!"? But don't praise the politicians too fast. Before you say "Prices are just too high," or "Score one for keeping gas prices under control," recheck the story.
The law that was broken sets a MINIMUM price for gas sales. It doesn't stop prices from rising too high, but from falling too low -- whatever that is.
Yup, Midwest Oil is facing $140,000 in fines for selling gas too low in its Minnesota stations.
So why is there a law like this? Some alleged do-gooders decided that small Mom and Pop gas-only stations couldn't compete effectively against gas stations that also serve as convenience stores, selling snacks and soda -- or pop as they call it in Minnesota. These convenience store gas stations make enough on their other items to be able to lower their price on gas.
So, legislators set a minimum price for gas. This law costs drivers more while also making it easier for gas stations to provide less in services.
Do you see why I trust markets more than politicians? When you meddle in people's legitimate business, you get a muddle. And pay more, or get less -- or most likely both.
Good intentions, I guess -- just don't drive the road that's paved with 'em.
This is Common Sense. I'm Paul Jacob.