Daily English
Cultural English
Practical English

1180 Price Gouging

访问量:
Complete Transcript
Welcome to English as a Second Language Podcast number 1,180 – Price Gouging.

This is English as a Second Language Podcast episode 1,180. I’m your host, Dr. Jeff McQuillan, coming to you from the Center for Educational Development in beautiful Los Angeles, California.

Visit our website at ESLPod.com. Take a look at our special courses in Business English. Take a look also at our Introduction to the United States, a wonderful course that will give you background information on the history and politics of the U.S.A.

This episode is a dialogue between Pedro and Elisa about companies that increase their prices suddenly. Let’s get started.

[start of dialogue]

Pedro: Why are you changing the prices on all of those items in the store?

Elisa: Haven’t you heard? There’s a hurricane coming. People will be stocking up on basic necessities.

Pedro: I know that, but that still doesn’t explain why you’ve decided to jack up prices.

Elisa: There’s nothing wrong with taking advantage of a spike in demand during emergency situations. We’re in business to make money.

Pedro: That’s price gouging and you know it. There are laws against that. And plus, we shouldn’t be exploiting people’s fear.

Elisa: I’m not responsible for that hurricane and I didn’t tell people to hoard. I’m not hiking prices so high that people can’t afford it. I’m just increasing them to discourage hoarding, that’s all.

Pedro: I don’t know. It still doesn’t feel right. It feels like we’re profiteering.

Elisa: No, we’re not. We’re making a sound business decision. Hey, where are you going with those?

Pedro: I’m putting some of these items in the back to reserve for people who can’t afford your new prices, the poorest and the most vulnerable in our community.

Elisa: You’re not suggesting we give those items away!

Pedro: You’ll thank me later for helping you to assuage your guilty conscience.

Elisa: Humph!

[end of dialogue]

Pedro begins by asking Elisa, “Why are you changing the prices on all of those items in the store?” An “item” is simply a thing that you sell in your store. Alisa says, “Haven’t you heard? There’s a hurricane coming. People will be stocking up on basic necessities.”

A “hurricane” (hurricane) is a violent storm with winds that move in a circle, in a circular motion. These are called “typhoons” in some parts of the world. Basically, in the Atlantic Ocean, these storms are called “hurricanes.” They’re the storms that typically affect the eastern and southern part of the U.S. In certain parts of the Pacific Ocean and other oceans, they’re called “typhoons,” but it’s the same weather phenomenon.

“People will be stocking up,” Elisa says. “To stock (stock) up” is a two-word phrasal verb meaning to buy a lot of something and save it to use later. If there is a hurricane coming, it’s possible that the stores will then be closed, and so you will want to stock up – you will want to get a lot of things that you will need so that you can survive. We would call these things “basic (basic) necessities.” “Necessities” comes from the word “necessary.” It’s referring to things that you actually need to live, such as food and water.

So, Elisa is raising the prices – changing the prices on the items in her store because everyone is going to be coming and buying basic necessities, and one of the features of what we call a “market economy” is that the price of something depends on both how much there is of it and how much people want it. And if there isn’t very much and a lot of people want it, the price goes up.

Elisa is expecting more people to want to buy things from her store, and so she’s raising the prices. Pedro says, “I know that,” meaning I know there’s a hurricane coming, “but that still doesn’t explain why you’ve decided to jack up prices.” The phrasal verb “to jack (jack) up” means to increase very significantly in a very short amount of time. Pedro had never studied economics in school, it appears.

Elisa says, “There’s nothing wrong with taking advantage of a spike in demand during emergency situations. We’re in business to make money.” A “spike” (spike) here refers to a sudden increase in something or in the amount of something. The “spike” Elisa’s referring to is a “spike in demand” (demand). As I just mentioned, there are two things that determine price, basically. “Demand” is the amount that people want something. “Supply” (supply) is how much of something there is.

People adjust their priorities – people decide what’s important to them – in part by what they buy. If something is very important to you, then you may not buy certain things in order to have money to buy other things – things that might have a higher price. That’s one of the things that price does. It communicates information to you about how much something is available and how much other people want it, and allows you to make decisions based on that information.

Elisa says that she is “taking advantage of,” meaning she’s trying to get a benefit from, the increase in demand or spike in demand during this emergency situation – the hurricane. “We’re in business to make money,” she says. That’s the reason that she has her business. Pedro says, “That’s price gouging and you know it.” “Price gouging” (gouging) is not so much an economic concept as it is a moral determination or an ethical judgment on people who do in fact raise their prices suddenly when someone needs something and wants it very badly during an emergency situation.

“To gouge” someone is to be unfair in the price that you charge that person. “Price gouging” is the idea that if you raise your prices significantly for something that someone wants and needs very badly – if you raise it significantly and quickly, I think is the idea here – then you may be accused by some people of “price gouging” – of being unfair to people because you have raised your prices significantly.

Pedro says, “There are laws against that.” I’m not sure if that’s true in most places in the U.S. Perhaps it is. No doubt in some places that might be true, or in other countries that might be true. “And plus” – meaning in addition – Pedro says, “we shouldn’t be exploiting people’s fear.” “To exploit” (exploit) means to take advantage of someone or something in an unfair way, to hurt another person in some way that involves the advantage that you have over that person.

Pedro thinks that raising the prices would be “exploiting people’s fear.” I’m not sure why it exploits people’s fear, but that’s what Pedro thinks. Elisa says, “I’m not responsible for that hurricane and I didn’t tell people to hoard” (hoard). “To hoard” – very important you pronounce the last consonant there, the D – means to buy a very large number of things, more than what you actually need or more than what you could even use.

Sometimes people use this verb when they have some sort of psychological problem – when they collect all sorts of things in their house and their house doesn’t have any more room anymore because they’re hoarding certain things. But in this situation, “to hoard” means to buy more than what you are really going to use, just because you perhaps are afraid that you will no longer have enough. You will “run out,” to use the phrasal verb. So, Elisa says she’s not telling people to hoard.

She says, “I’m not hiking prices so high that people can’t afford it.” “To hike” (hike) a price means to increase it dramatically. She says she’s increasing her prices, but not so high that people can’t afford it, meaning that no one could actually buy it. That would be stupid for her to do economically, of course, because if she raises the price so high that no one can buy it then she won’t make any money. “I’m just increasing them,” meaning her prices, “to discourage hoarding, that’s all.” “To discourage” (discourage) means to make other people not want to do something.

Elisa is saying that she’s increasing her prices so people don’t hoard and presumably there will be more of these basic necessities for other people. I’m not sure if that’s exactly her reason and neither is Pedro. He says, “I don’t know. It still doesn’t feel right,” meaning it doesn’t seem correct. It doesn’t seem like it is ethical. “It feels like we’re profiteering.” “Profiteering” (profiteering) means to make an unfair profit.

Usually the idea here is that you’re making a large amount of money, but you’re hurting other people while doing it. We only think this typically of other people or other companies that raise their prices suddenly. If we’re benefiting from it, well, we don’t normally consider ourselves to be profiteering. Elisa says, “No, we’re not,” meaning we’re not profiteering. “We’re making a sound business decision.” The word “sound” here refers not to noise or something that you can hear, but rational, logical, well thought out. “It’s a sound decision.” It’s a good, reasonable decision.

“Hey, we’re you going with those?” Elisa says. Pedro responds, “I’m putting some of these items in the back,” meaning in the back of the store, “to reserve for people who can’t afford your new prices.” “To reserve” (reserve) here means to save something that you are going to use at a later time. Pedro says, “the poorest and most vulnerable in our community” are going to be the ones he’s going to give or sell these items to – “vulnerable” (vulnerable) means easily hurt or damaged – people who, according to Pedro, won’t have enough money to buy these basic necessities.

Elisa says, “You’re not suggesting we give those items away!” “To give something away” means to let other people have it for free, to not charge them any money. Pedro says, “You’ll thank me later for helping you to assuage your guilty conscience.” “To assuage” (assuage) means to reduce, to make less intense. Something may “assuage” your fears, may make you less afraid. In this case, Pedro wants to assuage Elisa’s “guilty conscience” (conscience). Your “conscience” is what tells you whether something is right or wrong. If you are guilty, you’ve done something wrong.

So, a “guilty conscience” is the idea you have that you’ve done something wrong. And that’s what Pedro thinks Elisa is doing by raising the prices on basic necessities. So, he’s going to give some of the things the store sells to people who he considers poor and vulnerable so that Elisa won’t feel so bad in the future when she will no doubt regret having raised the prices. That’s why he says, “You’ll thank me later” – when you realize what you are doing – “for helping you assuage your guilty conscience.” Elisa, of course, isn’t very happy with Pedro for doing this.

Now let’s listen to the dialogue, this time at a normal speed.

[start of dialogue]

Pedro: Why are you changing the prices on all of those items in the store?

Elisa: Haven’t you heard? There’s a hurricane coming. People will be stocking up on basic necessities.

Pedro: I know that, but that still doesn’t explain why you’ve decided to jack up prices.

Elisa: There’s nothing wrong with taking advantage of a spike in demand during emergency situations. We’re in business to make money.

Pedro: That’s price gouging and you know it. There are laws against that. And plus, we shouldn’t be exploiting people’s fear.

Elisa: I’m not responsible for that hurricane and I didn’t tell people to hoard. I’m not hiking prices so high that people can’t afford it. I’m just increasing them to discourage hoarding, that’s all.

Pedro: I don’t know. It still doesn’t feel right. It feels like we’re profiteering.

Elisa: No, we’re not. We’re making a sound business decision. Hey, where are you going with those?

Pedro: I’m putting some of these items in the back to reserve for people who can’t afford your new prices, the poorest and the most vulnerable in our community.

Elisa: You’re not suggesting we give those items away!

Pedro: You’ll thank me later for helping you to assuage your guilty conscience.

Elisa: Humph!

[end of dialogue]

Be sure to stock up on ESL Podcast and listen to all the wonderful dialogues written by the wonderful scriptwriter, our very own Dr. Lucy Tse.

From Los Angeles, California, I’m Jeff McQuillan. Thank you for listening. Come back and listen to us again right here on ESL Podcast.

English as a Second Language Podcast was written and produced by Dr. Lucy Tse, hosted by Dr. Jeff McQuillan. Copyright 2015 by the Center for Educational Development.

Glossary
hurricane – a violent storm in a tropical area, with winds moving in a circular motion

* The hurricane knocked over many trees and power lines.

to stock up – to buy a large quantity of something to save and store it for later use

* We stock up on toothpaste and toilet paper whenever it goes on sale.

basic necessities – ordinary things that are required for daily life, such as bread, water, toothbrushes, and underwear

* We don’t have much room in the suitcase, so please pack only basic necessities.

to jack up – to increase prices significantly in a very short period of time

* Why are these gas stations jacking up the price of fuel?

spike – a sudden increase to the size or amount of something

* The researchers noticed a spike in brain activity when the participants viewed bright colors.

demand – the amount of something that people want to have and are willing to pay for at a particular price

* Demand for pumpkins is strongest in October and November.

price gouging – the practice of significantly raising the price of what one sells when other people want and need it very badly, especially in an unfair way to make a lot of money

* Stores that increase the price of flashlights, batteries, and bottled water immediately before a storm are engaging in price gouging.

to exploit – to take advantage of someone or something in an unfair way; to use something for one’s own benefit, especially when that hurts another person

* Some people believe that the university is exploiting student athletes by making them practice long hours to win games, leaving little time for their education.

to hoard – to purchase or gather a very large number of objects, more than one actually needs or that is useful

* Why are you hoarding all these old newspapers? Let’s just recycle them instead.

to hike – to dramatically increase the amount or price of something

* Getting good media coverage of our products could help to hike demand.

to discourage – to make others not want to have or do something; to reduce someone’s interest in having or doing something

* How can we discourage Americans from eating too much unhealthy food?

to profiteer – to make an unfair profit; to make a very large amount of money in a way that hurts other people

* Many people were able to profiteer by making and selling liquor during Prohibition between 1920 and 1933.

sound – rational and logical; well thought out

* In your cover letter, try to present sound reasons for the company to hire you.

to reserve – to save something for a later time or for someone else; to not use, have, or do something right away

* We reserve those seats for the elderly or the disabled who need assistance.

vulnerable – easily hurt or damaged; not safe or secure

* Children without caring and involved parents are more vulnerable to bad influences in childhood and during teen years.

to give (something) away – to give something to other people for free, without receiving payment

* On opening day, the store gave away t-shirts to the first 100 customers.

to assuage – to make something less intense; to provide relief; to reassure

* What can we do to assuage clients’ fears about investing in the stock market right now?

guilty conscience – a feeling that one should not do something, or that what one is doing is wrong

* For years, Shana had a guilty conscience about having stole money from her aunt’s purse.

Comprehension Questions
1. Which of these is an example of price gouging?
a) Hoarding
b) Profiteering
c) Reserving

2. Who is likely to buy the most?
a) Someone who is stocking up on the basic necessities
b) Someone who is hoarding
c) Someone who is giving items away

Answers at bottom.

What Else Does It Mean?
to jack up

The phrase “to jack up,” in this podcast, means to increase significantly in a very short period of time: “The airlines are charging for extra leg room and wider seats as a way to jack up profits.” The phrase “to jack (something) up” can also mean to use a tool to raise something heavy off the ground, especially to lift a car: “Could you please help me jack up the car so that I can change the tire?” The informal phrase “to jack (someone) around” means to make things difficult for someone, not providing information, and wasting that person’s time: “Stop jacking me around and answer the question!” Finally, the phrase “to do jumping jacks” means to perform an exercise by hopping between two positions: one with the feet together and the hands by one’s sides, and another with the feet apart and the hands raised above one’s head.

sound

In this podcast, the word “sound” means rational, logical, and well thought out: “The author makes a sound proposal with several supporting arguments.” A “sound sleeper” is someone who sleeps well and is not disturbed easily: “Don’t worry about making noise. The kids are sound sleepers who almost never wake up during the night.” “Of sound mind” is a fairly formal phrase meaning free of mental illness: “The judge will determine whether the man is of sound mind before beginning the trial.” A “sound bite” is a short recording of someone’s words, used in a news program: “The reporter is explaining the court’s reaction to the politician’s sound bite.” Finally, “sound effects” are noises that are produced to accompany a film or play: “Let’s find some good sound effects to make this haunted house even scarier.”

Culture Note
Laws Against Price Gouging

Price gouging occurs when a seller quickly increases the price of something or some service when it is “in greatest demand” (when people want and need it very badly), typically during “natural disasters” (phenomena such as earthquakes, hurricanes, and floods). Price gouging typically involves “emergency supplies” like bottled water, “bleach” (a liquid used for cleaning, especially after a flood), flashlights, batteries, medicine, and food.”

Many people feel that price gouging is “exploitative” (unfairly takes advantage of people who have many problems). However, other people argue that price gouging is simply a natural “response” (reaction) to increased demand. “Economics” (the study of how economies work) explains that suppliers’ prices must increase when buyers want to buy more of something, and prices must decrease when buyers want to buy less of something. People who believe this argue that price gouging laws help to “prevent” (not allow something to happen) people from “hoarding” (buying a very large amount of something and storing it for the future), which would limit the amount of emergency supplies available to others. And some people even argue that price gouging gives businesses an “incentive” (motivation; a reason to do something) to provide emergency goods and services during natural disasters.

As of 2008, 34 states had “enacted” (created laws) laws against price gouging. For example, the state of California has “capped” (set a maximum limit or amount) any such price increases at 10 percent. The state of Florida has “banned” (not allowed) price gouging, unless the seller can “demonstrate” (show; provide) that the increased price is needed to “cover” (make up for; pay for) increased costs, such as the costs of paying employees more so that they will work during a natural disaster.

Comprehension Answers
1 - b

2 - b