It helps if you get the facts correct.
There was, initially, no shortage of gasoline. There was no run on gasoline prior to the arrival of weather the results of which remained an unknown. What occurred after the devastation was a wide spread power outage. There was still no shortage of gasoline. What was lacking was electrical power at gas stations with which to pump the gasoline. Gas station tanks remained right at the levels they were at before the power went out.
With the wide spread power outages, there was an increased demand for generators and the gasoline they run on. That increased the market demand for gasoline, the supply of which had been artificially limited by the lack of power with which to pump it. And it put motorists in competition with home generator customer demands. Demand for gasoline skyrocketed.
Absent any allowed price mechanism, there was a run on gasoline with no mechanism for determining urgency of need. Motorists needing gas to get to jobs were put in competition with motorists who had no urgent need for gasoline, but didn’t want to run out. Both were in competition with home owners who needed gasoline for generators, along with home owners stockpiling gasoline for either generator use or potential generator use. What all buyers of gasoline shared in common was the total lack of any incentive to conserve gasoline.
Given that the price for gasoline was kept artificially low, being limited to rising only 10% from pre-storm prices, consumers received no price signal that gasoline was now more rare and therefore more valuable. Consumers bought it, and used it, in a manner befitting an ample and accessible supply. The power outages continued. Consumers drove, and ran generators, in a manner which would make sense only were there an ample supply of gasoline. Those stations with electrical power soon ran out of gasoline, putting successively greater pressure on those stations still with both. As a result, the state instituted rationing but, it did so still in a manner unreflective of actual consumer need. Rationing did nothing to increase the supply of available, pumpable gasoline…it merely made the gas lines shorter by its odd-even system.
Gasoline immediately became a black-market commodity commanding up to $20 per gallon. Black markets always arise when government artificially restricts supply of a commodity by the method of price fixing. And paradoxically, that price fixing itself increased the demand placed on gas stations because consumers with no need for gasoline themselves bought more than needed for purposes of resale.
As happens every day in the free market during normal times, the price of gasoline rises and falls based upon supply and demand. Demand goes up in the summer and no one thinks gas stations are gouging when each and every Memorial Day the price rises, and stays somewhat higher until Labor Day, when demand drops. Had such a market mechanism been allowed to work in NY/NJ it would have extended the supply for a longer time, from a limited number of stations able to pump, and ensured that those most desperate for it would have found it available. Those sitting home, with power and no need to go to work, would have stayed home and not gone out to buy gas, “just in case”. That alone would have seriously ameliorated the crisis. We know this run effect to be true because we observe it before every similar weather event in commodities more commonly needed, such as flashlight batteries, fresh milk and bread, and bottled water. We commonly see grocery stores sold out of such commodities and we know, just by running the numbers, that much of what is bought is not actually needed due to household shortage, even anticipated household shortage, but is bought for, “just in case”.
Had gasoline been allowed to rise to, say, $10 per gallon there would have been far, far less demand for it. That would have far better ensured that there remained a supply for those most critically in need of it, it would have created a tremendous incentive for gas station owners without power to purchase the larger sized generators needed for running multiple gas pumps simultaneously, and it would have precipitated the loading of tanker trucks throughout the tank farms within the regions to the west, encouraging otherwise disinterested truck drivers to reap a profit in resupplying empty gas stations with power, but no gas.
Instead, what happened is there were a lot of gas station owners without power, and no incentive to acquire power on their own, who sat home comfortable that they weren’t losing money by letting their gas sit in the ground. Had the price of gasoline been allowed to rise, those station owners would have been immediately ordering $10,000 large capacity generators out of every market that could deliver them in short order, so as to realize a windfall profit on the very ample gas reserves they had sitting in the ground at their stations. That did not happen. And thus, an unavoidable crisis was made worse by government action where none was required.
The demand, as in all crises, was that government “do something”. It did, and it made things worse, as more often than not it is wont to do. Had it let individuals act in their own best interest, the self interest of the market that supplies everything we need for the comfortable life we enjoy, a life that knows virtually no shortage of any basic commodity, there would not only have been more pumpable gasoline, it would have gone to those most in need, and the resupply chain would have been much more creative and efficient. And all those electricians sitting home, waiting for the power to come back on, so they could commence rewiring houses, would have been immediately busy wiring in generators.
Instead, those here appear to prefer the socialist solution that merely ensures shared misery by all concerned. Socialist; it’s what one calls those who either don’t believe in capitalism, or have no idea how it works. They always panic, demand government action, and then fail to take responsibility when, getting what they want, it only makes things worse.
The hilarity of it is that any fourteen year old kid with a snow shovel and a record-setting blizzard in the offing knows far better how the world works. With a foot of snow to remove, versus a more normal few inches, he sets out to make some money. Instead of his normal $5 per driveway, he charges $10 per driveway, and he doesn’t worry about those people who turn him down. The vast majority of them don’t need their driveway shoveled, for whatever reason…but mostly because they’re not going anywhere, and there are plenty of people who need it done as soon as possible. And guess what? When the kid runs into someone who must get out, but doesn’t have the money to pay his rate, he can afford to donate his services because he’s made a profit that allows him to be charitable. Now you understand not only how capitalism works, and also how charity works. Charity always comes from profits made above and beyond that required for the giver’s needs and survival. It comes because the kid made enough to replace the shovel he wore out “gouging” customers who willingly paid it for a job they valued in the amount paid.
And now you also understand why this country is on the fiscal rocks; it’s filled with people who want everything, but don’t think they should have to pay for the everything they want, while preferring that government take it from someone else via the impersonal method of confiscatory taxation.