Recently here in Vancouver, Canada, medical mask resellers were punished by authorities, with their inventory seized and fines imposed. This is the second time resellers have been punished in recent weeks. This action is the exact opposite of what the government should do if it wants to see an increase in supply of medical masks to people who need them.
A local mayor, Brad West, has called the acts of the resellers to "egregious, so irresponsible, so selfish and so motivated by greed." It is this writer’s contention that unless the resellers stole those masks, it is the actions of local authorities which are egregious and irresponsible. West is presuming that those who buy those masks have no legitimate need for them. The CDC now states that wearing masks helps reduce the risk of COVID-19 exposure. How is it that the voluntary selling, and buying, of medical masks to protect you and your family is considered egregious and irresponsible?
The commercial actions of resellers, if anything, help boost supply of those masks to the consumer market. Retails stores and pharmacies are out of inventor,y because their supplier can’t ostensibly meet retail demand. Now, a reseller, through his own resourcefulness and researching of the wholesale market, has come upon a supplier who is willing to provide inventory to him. The reseller contacts the supplier and arranges for the purchase and shipment of those masks. He allocates time and energy to make this transaction, taking certain risks that the masks might not arrive in a timely manner or might be withheld by customs, or otherwise might not be delivered by a deceitful and unscrupulous wholesaler.
For his time and effort, the reseller is paid a profit (i.e., wages) over the wholesale price. His customers get hold of masks in a time when all store shelves are empty. The more resellers there are, the more orders are given to wholesalers and manufacturers, and the more of the product is made available to the consumer market. As demand gets satiated, prices eventually come down.
What the government has done is effectively shut down productive distribution and reseller channels, which are vital and very necessary in ensuring that retail customers get what they want. They have disincentivized entrepreneurs from going out and sourcing suppliers who can help satisfy demand.
And to make a bad situation even worse, the government has shut down a source of income for entrepreneurs who are now out of work due the lockdown and must now rely on employment insurance and other forms of government welfare, putting an even greater strain on government coffers (i.e., taxpayer money).
When will government ever learn?
