While it will probably be vetoed by the White House, the House of Representatives passed a bill designed to prevent price-gouging at the gas pump after catastrophes, like Hurricane Katrina or Hurricane Charley (NY Times).
The House bill would give the FTC “the explicit authority to investigate and punish those who artificially inflate the price of energy,” and require offenders to pay triple damages, or up to $3 million, for charging “unconscionable prices” (CNN Money).
Now I understand that there are going to be legitimate criticisms with this bill, but two cited in the CNN Money article are laughable. First, there’s an insinuation that the bill would cause long gas lines like during the shortage in the 1970s (that could only be caused by a drop in supply — which could only be a retaliatory move by refineries). The second strange criticism comes from the executive vice president of the National Petrochemical and Refiners Association, whose very position pits him against the bill. His criticism may be valid, but the author of the article could have found a less biased source.
All things considered, the bill may not be necessary as anti-gouging laws are already on the books. For more about gas price gouging, CNN Money provided a FAQ a few years ago that explains how gas at the pump is priced, why there are regional variations in price, how to detect gouging, and how to report suspected illegal pricing.
Updated February 10, 2011 and originally published May 24, 2007. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.