From the cost of groceries to gas for our cars, Americans around the country are feeling the hit from prices going up.
Some lawmakers are now looking to crack down on cases involving price gouging during the pandemic.
Right now, there is no federal law that expressly prohibits price gouging.
Instead, it’s largely handled at the state level.
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Democrats in the House are pushing the “COVID-19 Price Gouging Prevention Act” which would allow the Federal Trade Commission (FTC) and State Attorneys General to go after companies unfairly raising prices.
According to the proposal, the bill “makes it unlawful for any person to sell or offer for sale a consumer good or service during a public health emergency resulting from COVID-19… at a price that (1) is unconscionably excessive, and (2) indicates that the seller is using the circumstances related to the public health emergency to increase prices unreasonably.”
“We have seen skyrocketing billionaire wealth and corporate greed take advantage of people, people’s fears,” said Rep. Jan Schakowsky (D-Ill.), Chair of the House Consumer Protection and Commerce Subcommittee and co-sponsor of the bill. “The COVID-19 Price Gouging Prevention Act will empower the Federal Trade Commission and State Attorneys General with the enforcement tools that are needed to effectively go after price gougers.”
Supporters of the bill urged lawmakers to pass the proposal to make sure people have equal protection against price gouging no matter where they live.
“It should be in place as soon as possible to help stop price gouging now and so the next emergency does not result in the exploitation we’ve seen over the last two years,” said Alex Harman, a competition policy advocate for the nonprofit group Public Citizen. “The lack of a federal law, inconsistency or absence of laws in the states, combined with online shopping that transcends state borders, has created gaps in protection for price gouging.”
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But Republicans cautioned against too much government involvement and argued the proposal doesn’t address the problem with rising inflation.
“I can’t support this legislation in front of us today and we shouldn’t let it divert our attention from President Biden’s big government spending programs and over regulation,” said Rep. Gus Bilirakis (R-FL), Ranking Member of the House Consumer Protection and Commerce Subcommittee. “Giving consumers a false protection here without properly identifying actual harms will give the FTC Chair more unchecked powers.”
Critics of the bill also said the language isn’t specific enough when it comes to defining price gouging.
They also warned about the potential unintended consequences for small business owners who struggle to keep up with rising costs.
“I’m worried that the term corporate could be extended directly down to small businesses, local mom and pop grocery stores that are struggling mightily in this time period and would even put them in a more difficult position than they are now,” said Glenn Richey, a Harbert Eminent Scholar and Chair of the Department of Supply Chain Management at Auburn University Harbert College of Business.
The bill has only been introduced in the House and not in the Senate at this time.
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