(snip}"A debate also exists over the impact of laws governing minimum gas prices. In Maryland, independent operators stand on one side of the issue, with the FTC, the AAA auto club and big chains on the other.
Paul Fiore, director of government affairs for the Washington, Maryland, Delaware Service Station & Automotive Repair Association, said that without the law, chains would force independent operators out of business and eventually increase their prices. With the assistance of an Annapolis lobbyist, Bruce C. Bereano, the Bowie association argued to lawmakers that the law would benefit consumers in the long term.
"You have to look at where the market will be . . . after competition is removed," Fiore said. "Protecting competition creates a better consumer market. I don't see any hard evidence that this has been harmful to consumers."
Opponents say the law deprives consumers of the benefit of competition because it creates an artificial price floor. Even if independent operators were driven out of business, they said, the market would remain competitive.
"These laws are not necessary," said Mitchell J. Katz, an FTC spokesman. "They hurt competition."
Several economics professors were unable point to any definitive research showing that the law would ultimately hurt or benefit consumers.
R. Michael Cortez, vice president and general counsel for Sheetz, said the Altoona, Pa., retailer would like to sell below cost on occasion but not for extended periods. He compared a brief drop in gas prices to a sale held at a clothing store designed to draw in new customers.
He said the Maryland law dampens competition. "It forces companies to increase the price artificially, and it forces companies to become price followers and not price leaders," Cortez said. "All of that results in increasing gas prices."(snip)
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This Maryland law comes from the same school of thought as 'minimum wage' laws, in that it is 'theoretically' supposed to provide independent mom & pop gas stations with a guaranteed ability to earn a 'living wage'. However, this comes at the expense of every other Maryland business and individual who must buy gasoline, who are forced to pay higher than necessary prices at the pump to fund this de-facto gov't subsidy. It also preserves a system of distribution which is racked with low volume inefficiencies, and passes the extra costs of those inefficiencies along to Maryland gasoline buyers.
In reality, a large number of Maryland individuals and Maryland business vehicles will be crossing the Virginia and DC state lines to fill up for less. This of course has the unintended consequence of costing the state of Maryland a significant amount of lost gasoline tax revenue, costing the Maryland mom & pop gas stations lost sales volume, and fertilizing the idea in the minds of some 'middle class' Maryland residents and non mom & pop gas station business owners that perhaps they should investigate moving to Virginia !
IMHO this is yet one more example that heavy gov't regulation of businesses, and the increased costs of those heavy regulations, can only work in the long term if the government is able to keep 'foreign' suppliers out and to keep 'domestic' customers in ! It is arguable if this is even possible on a national level. It is certainly NOT possible on a state level.




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