Thursday, July 24, 2008

Quebec government agency forces gas prices up

A bizarre case of government price-fixing that worked AGAINST consumers was blasted by the Montreal Gazette.

The Régie de l'energie, the government agency that sets floor prices for gas in the province, has ordered gas stations in the St. Jérôme area, where gas prices have lately been among the lowest in Quebec, to raise them by three cents a litre.

In doing so, it was responding to complaints by independent gas retailers that they were being ruinously undersold by big-box store chain Costco, which was selling gas in the area at a price that would drive the independents out of business if they matched it.

But that's how the marketplace works.

A certain amount of competitive Darwinism makes sellers efficient and increases buyers' purchasing power.

Laws against price-fixing and laws that encourage competition should be all the protection consumers need. Anything beyond that - such as minimum pricing - is merely government meddling, at consumers' expense, in support of a favoured few suppliers.

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