- May 22, 2017
- Reaction score
President Donald Trump slammed 3M Co in a tweet late on Thursday after earlier announcing he was invoking the Defense Production Act to get the company to produce face masks.
My understanding so far is that the Trump administration enforced restrictions a few weeks back to prevent "price gouging" in regards to manufacturers bidding desperate hospitals against each other in order to drive prices up and capitalize on the pandemic. This looks good on paper. However, this only applies to domestic sales. For example, let's say 100 surgical masks typically sells for $100. After the restrictions, the manufacturer would have to sell the masks at a price of 100 masks for $100 instead of driving the price up to $2000 dollars for the same amount. The first problem is that this interferes with free market enterprise. The second consideration is that it doesn't include exports to other countries. So, a company can sell 100 masks for $100 to the local hospital or $2000 to some hospital in another country, which is an export and helps our trade balance. 3M was siphoning 10,000,000 million surgical masks a week (50% of its manufacturing capacity) off to other countries who were desperate enough to pay far more than standard price and bringing massive dollars into our country. Everything looks great. Here comes the problem. American hospitals started complaining about running out of medical masks and 3M not filling their orders, people started checking into things, and everyone is jumping to the wrong conclusion.
Instead of seeing this as an opportunity to put even more Americans to work manufacturing and selling even more masks, the Trump administration is forcing 3M to sell exclusively to companies. We should simply put more Americans to work and sell to everybody, both domestic and foreign since we obviously have the market.