Texas Versus Cheaper Than Dirt
BY Herschel Smith
4 years ago
That’s not the name of a court case, but I expect it will be in the future.
Texas Attorney General Ken Paxton has accused the Fort Worth-based website Cheaper Than Dirt, which primarily sells firearms, ammunition and hunting gear, of price gouging at the start of the pandemic.
The AG’s office identified over 4,000 sales that involved price gouging and has directed Cheaper Than Dirt to pay $402,786 in refunds to consumers, according to court documents filed this month.
Over 100 people have complained to the AG’s office about Cheaper Than Dirt, the Houston Chronicle reported earlier this year.
The same week that Gov. Greg Abbott made a pandemic-related disaster declaration in Texas, ammunition orders to Cheaper Than Dirt substantially increased. In response to the increased demand for its products, the website raised the prices on hundreds of its products, according to the AG’s office.
The Texas AG’s office has identified ammunition as a necessity and, as a result, is arguing that those price hikes were against the Texas Business and Commerce Code. The code forbids businesses from “taking advantage of a disaster” by selling “fuel, food, medicine, lodging, building materials, construction tools or another necessity at an exorbitant or excessive price.”
Additionally, the following weekend that Abbott issued the disaster declaration, Cheaper Than Dirt manually raised its prices outside of its normal schedule.
“Making these manual ‘real-time’ price changes caused confusion for consumers because the prices consumers saw on the website pages when selecting items for purchase were different from the prices that appeared in the final check-out cart,” the AG’s office said in court documents.
Some of the comments I’ve seen online point to declarations of guns and ammunition as being essential and necessary, and you can’t benefit from that in a time of emergency (not that I agree with Covid being an “emergency”) and then raise prices without running afoul of the law.
On the other hand, making stores and products available in an emergency isn’t the same thing as buying them for you, or even ensuring price controls.
I don’t believe in price controls. No free market advocate believes in price controls. I’ve seen the CTD ads in my in-box and if I stupidly open them, I usually laugh out loud at the prices.
You can find better ammo prices elsewhere by a large margin. It just requires a little work. I choose to ignore the CTD ads, almost never visit their web site, and just don’t shop there. They’ll probably never get any business back from me.
That’s how it’s supposed to work. Screw the customer, lose your customer base. The government should have nothing to do with it. However, I will say that letting people drop things in online carts and then raising the prices is pretty stupid. There should be a time-out on carts, and users should be informed what that is.
On December 18, 2020 at 1:56 am, Mike Ockizard said:
I purchased from CTD once about 9 years ago. Since then I have spent wayyyyy too much (or not enough) on gun stuff at all manner of alternate places. F-CTD.
On December 18, 2020 at 4:09 am, Archer said:
On one hand, having an algorithm that adjusts price based on demand and available supply is good business sense. Hell, Amazon does it all the time. (Ever watched an item for a couple days and notice the price adjusting itself a few bucks up or down? Also, notice their prices drifting up during holidays, and even more during the pandemic lockdowns, as other stores are shutting down? That’s the algorithm working, for better or worse.)
On the other hand, raising prices on necessary supplies manually, outside the normal update schedules and more than the algorithm indicates, in response to a widespread crisis, is pretty much the definition of price gouging. An algorithm should be transparent, demonstrable as needed, and repeatable; manual, subjective price-setting is none of those things.
As a free market capitalist, I’m on the fence whether price gouging laws should exist — if the item (ammunition in this case) was necessary, you should already have had some; it’s not the government’s job to save you from your own poor planning — but as long as the laws are there, CTD is required to follow them, and they do help keep the corporate parasites at bay and keep ammo prices from jumping into the “yacht club only” realm (which is where they would have been most of this year).
Finally, as a “small-l” libertarian, if we’re serious about the 2nd Amendment being for everyone, letting opportunistic businesses gouge ammo prices is nothing more than a private-sector-induced poll tax that only the very-wealthy can afford. Out of all the options for keeping prices within the ability of most people — including but not limited to subsidizing ammo with taxpayer dollars or Marxist-style price setting — laws against price gouging seems to be the least intrusive and most narrowly-tailored means to do it.
Just my $0.0263, adjusted for inflation, and worth every penny you’re paying for it.
On December 18, 2020 at 8:40 am, Bill Buppert said:
Prices are the ultimate arbiter of rationally calibrating distribution of scarce goods and services and the most effective way to allocate resources but the moment political actors craft laws that regulate the market, the inefficiency and sheer idiocy of central planning gums up the efficacy of market goods distribution.
The political vermin can say that if all prices are the same it is collusion, if one or more market actors are pricing low, it is predatory and if charging too much, gouging; hence the three conditions of availability have convenient conditions for Marxists and central planners to step in and interfere with natural markets to everyone’s detriment.
CTD has always been awful and I avoid them like the plague.
On December 18, 2020 at 9:56 am, Longbow said:
How about not shopping there?
If their prices are too high, don’t spend your money with them.
The internet is a vast (cyber)space. There are many vendors.
Mr. Paxton, knock it off! You’re trying to play HERO, for votes. Try working with other States’ SOS’s and DOJ’s to unfuck the last election instead.
On December 18, 2020 at 12:05 pm, Fred said:
Careful what you wish for. Government always brings a cascade of second and third order affects. Let the market sort it out, as messy and time consuming as that may be. Supply – Demand – Price Signal works.
On December 18, 2020 at 2:33 pm, PubliusII said:
Both high prices and low prices contain their own correctives — that’s how markets work. (When politicians keep their hands off.)
On December 19, 2020 at 12:08 pm, otherwise... said:
“Cheaper Than Dirt” has never been cheap. I, for one, have never understood why anyone shops there.
On December 19, 2020 at 1:34 pm, =TW= said:
I never got burned by CTD. If the price was too high I bought elsewhere.
If their business model proves unprofitable they are free to change it- or Close Their Doors. (See what I did there?)
They may price themselves out of business without any “help” from the Texas AG.
And Paxton would be free to pursue real criminals.
On December 19, 2020 at 2:07 pm, Pat Hines said:
CTD has been doing this for a long time, they were worse during the Obama ammo shortage.
I vowed to purchase nothing from them back then and haven’t.