Briefly, I want to think Suburban for the opportunity to post on his blog.
I’ve been thinking about “shortages”. What it really means to have a “shortage”. As I walk down the isles of my local supermarkets I still see full shelves of a wide variety of fresh good quality foods. And thankfully still some relatively good deals. Yet it has got me thinking.
The common knee-jerk image is that a shortage means a lack of something. There’s something you want (something you need) that used to be plentiful but now is scarce.
That certainly is a form of “shortage”.
But not the only one.
A second form that a shortage might take is simply a greatly reduced lack of choices and options. You’re use to seeing 20 different kinds of bread in the supermarket, now you only see 5. Even if those 5 are still fairly plentiful, it’s only 5 to choose from instead of 20. Even if you didn’t want all the varieties anyway they were always an option. Now you have much less of a choice.
Third, a shortage might also manifest as being very low quality of the available choices. This usually goes hand-in-hand with the second form described above. You may have a selection of veggies at the grocery but those that are there are in bad shape. Maybe wilted, maybe banged up or broken up, etc.
And finally, a “shortage” may not be a lack of items or a quality issue but a real cost and affordability issue. There may be decent food in the store but the cost for all but a few items is prohibitively high! In that scenario the quality is irrelevant if you truly do not have the funds for it.
Another example: Gasoline. As of writing this gas has blown through $4/gal in my area and steadily on the rise. I, like millions of other Americans, have already cut waaaaaaay back on my driving and will continue to do so. The gas is there. The pumps are open. But I can’t afford a full tank and other necessities of life. From my perspective gas is in a shortage because I cannot afford all I need for daily life in addition to the other requirements of daily life.
I point out these possibilities not to split hairs but help make you aware that we can (and may already be) in a shortage scenario without every hearing any “official” declaration of it.
Thanks for the contribution.
Another aspect to shortages is duration. A lack of quantity or a higher price may only last a short time or be structural. For instance, 30 years ago, we used to eat things that were in season. When they were out of season, there was a shortage or even non-existence of that product. Sure, there might be a small quantity grown in a green house, but it was a small amount, low quality and high price. We waited for things to be in season. When the frosts hit northern Mexico, there were screams because peppers and other vegetables were hit and the price went up. Well, now in April, the prices for peppers are right back down or lower than before the freeze.
In an extreme situation, supply does not exist and product cannot be had for any price. Or such a small amount exists that the price is 3 or 4 times normal. There was a story I read about a town that had a tornado and the power was out for weeks. There was a high demand for ice. So, an entrepreneur rented a refrigerated truck, bought ice and drove it to the city. They sold ice for $10-$20 a bag. There were screams about price gouging, but people needed ice and they bought at significant cost over what they were used to. The next day when they came back with another load, they were arrested, the truck impounded and the ice melted. Thus, due to government interference, there was no ice to be had at any price. Shortage economics are quite interesting.
I’ve heard the ice story too. If not real it sure seems like it could/would be!