Contemporary and Social Issues

Price Gouging Doesn’t Pay – Compassion Does


Frasat Ahmed, USA

There’s a symptom of Covid-19 which affects millions beyond those infected.

While pandemics like the coronavirus bring with them debilitating physical symptoms, they also give rise to symptoms which latch parasitically onto the fabric of society – symptoms so venomous that no amount of medical prowess can undo them.

One such societal toxin is price gouging.

We were first exposed to this toxin in March 2020 when the world went into lockdown and people began to hoard essential supplies.

15 face masks for $4,000? Sold. Hand sanitizers for hundreds of dollars? Done deal. A bottle of milk for $10? You got it (Price Gouging Complaints Surge Amid Coronavirus Pandemic, NY Times).

We inhale this toxin again today as covid rapid test kits are in short supply, and are currently selling for $80 dollars and up. (NYC stores are price gouging COVID rapid tests, selling for $80 and up, NY Post). 

Business owners see their pockets swell, while the destitute see their stomachs shrivel.

This illicit profiteering has become so rampant that governments have been forced to intervene to protect society from those who feel no remorse in depriving their fellow man of basic necessities. (Newsom Signs Executive Order Prohibiting Price-Gouging For At-Home COVID Test Kits,  CBS Los Angeles). 

Meanwhile, at every step, we have Khilafat [Caliphate].

The Fifth Caliph and Worldwide Head of the Ahmadiyya Muslim Community, His Holiness, Hazrat Mirza Masroor Ahmad (aba) has prohibited Ahmadi business owners from price gouging:

‘Instead of making excessive and unnecessary profit especially on food items and essential goods, sell them at bare minimum profit. For these are indeed the days to serve humanity. As the Promised Messiah (as) has instructed, “You must inculcate within yourselves the spirit of compassion.” Again, these are the days to serve humanity’ .

Friday Sermon 10 April 2020

His Holiness, Hazrat Mirza Masroor Ahmad (aba), Fifth Caliph & Worldwide Head of the Ahmadiyya Muslim Community

With all that has transpired, we must collectively heed the wisdom and guidance imparted by the Caliph, and ensure that this is not simply overlooked. Because the truth is that price-gouging affects the entire market in a paralyzing plethora of ways.

From usurping the rights of our front-line workers to cruelly depriving our neighbours and friends of critical items during this worldwide pandemic, price-gouging is like forcefully snatching your fellow climber’s oxygen supply at the top of Everest just because you can. It is inevitable murder.

Yet, some have the sheer audacity to try and justify it.

If supply is low and demand is high, why not sell your product at a premium? In fact, price gouging is a good thing, some contend; it deters consumers from hoarding and keeps essential supplies in stock. So, ‘Gouge away!’ (‘Price gouging’ during crisis a good thing, Pittsburgh Tribune-Review)

But where does morality weigh into this equation? Does this free market formula of supply and demand consider the undue suffering it imposes upon those mired in poverty?

The prophets of God certainly do not think so. In fact, they have unanimously decried price gouging as an egregious sin for thousands of years.

Let us rewind the film-reel of time.

The Holy Prophet Muhammad (sa) denounces merchants who inflate prices through exploitative business practices as sinners (Musnad Ahmad bin Hanbal, Vol. 5, pg. 385-386).

Jesus of Nazareth (as) enters the Holy Temple to pray, only to see moneychangers charging innocent pilgrims exorbitant fees. He walks over and forcefully flips their tables upside down, saying ‘This is a House of prayer, but you make it a den of thieves?’ (Matthew 21:12-13)

The Midianite Prophet Shu’aib tells his people:

 ‘Give full measure and full weight with equity; don’t defraud people of their things and don’t commit iniquity in the earth, causing disorder’ (Holy Qur’an 11:86)

Hazrat Mirza Bashiruddin Mahmud Ahmad (ra), the Second Caliph of the Ahmadiyya Muslim Community writes that Shu’aib’s people not only indulged in idolatry, they were extremely fraudulent in their business dealings. They took full measure of payment without giving full measure of goods, i.e. they charged exorbitant prices for deficient goods.

Sounds a lot like price gouging, doesn’t it? In fact, it’s the exact definition of price gouging: An undue, excessive and unjustified increase in the price of essential consumer goods and services. Selling a commodity at an ‘unconscionable price,’ especially in crisis (“Price Gouging” Statutes and Regulations,

And it remains as unconscionable today as it did centuries ago, in the times of the prophets.

But what is so ‘unconscionable’ about price gouging?

If my neighbour’s house is on fire, and I only agree to give him my fire extinguisher if he buys it from me, there is something deeply wrong with me. I am taking advantage of his need and profiting off his desperation.

Accordingly, if a market allows sellers to take undue advantage of desperate consumers during a crisis, there is something deeply wrong with the market. Even former World Bank chief economist and Nobel economic laureate Joseph Stiglitz agrees. (Why Our Affluent Society Is Facing Shortages in the Face of the Coronavirus Pandemic,

One-dimensional formulas of supply and demand don’t work well in crises, he says. Yes, they work well when things are normal. But in crises, we need immediate action, with complex coordination and changing demands; linear markets don’t work well in these circumstances.

Markets that solely measure supply and demand are short-sighted in nature and discourage sellers from risking personal profit for societal benefit (Why Our Affluent Society Is Facing Shortages in the Face of the Coronavirus Pandemic, And when profit is in the picture, the value of human life is forced to compete with things like toilet paper and covid test kits.

Hence, we can’t rely on formulas of supply and demand in this international emergency when lives are at risk.

While supply for Covid tests, masks, medical equipment, and sanitizer runs dangerously thin, demand for these precious items soars.

But there’s another demand that skyrockets with it – one which, if we play our cards right, will never run out.

It is the demand of human compassion.

Pour this into the otherwise cold cauldron of supply and demand, and from the ashes of a self-serving market emerges a fire of universal benevolence whose flames of selflessness will never extinguish.

It’s ironic that in a world where many claim to have evolved beyond the need for religion, the teachings of Prophets from thousands of years ago become even more relevant today than ever before.

In any case, compassion is the organic ingredient that emergencies like this demand. Society relies upon people uniting and prioritizing human life over personal profit, even at the risk of nominal and temporary financial loss.

Don’t worry, you won’t lose your business if you keep your prices fair. In fact, experts state that you will probably gain business, because you strengthen ties with existing customers and market yourself as compassionate to new customers (Why Businesses Should Lower Prices During Natural Disasters, Harvard Business Review).

Inevitably, I would rather buy from a company that helped me in my time of misfortune rather than capitalize off of it. And I would rather have stores limit the quantity of stock I can buy instead of price gouging me. This will keep essential items in stock and deter me from hoarding.

So, like His Holiness, the Caliph (aba) said, price gouging doesn’t pay. Compassion does.

About the Author: Frasat Ahmad serves as an Imam at the US National Headquarters of the Ahmadiyya Muslim Community.