Friday, May 11, 2007

Greg Stumbo's Political Witch Hunt Against Big Oil

Attorney General Greg Stumbo has started suing oil companies for rising gas prices. This will satisfy a large part of the electorate, but Kentucky's stupid price-gouging law will eventually get a serious test in court.

With any luck, it will fail in the court of law. Price fixing laws are bad enough. Price gouging laws tie the concept of government control to emotional natural disasters and public emergencies to create an artificial price level that "feels right" to the politician who happens to be in charge at the time.

Unfortunately, good economics is usually bad politics. We desperately need to realize that when politicians "just do something" to fix a problem, they too often make is worse. Gas prices are a perfect example of this.