A Stitch in Haste

London hotels are being criticized for "gouging" in the wake of the London attacks:

With the transport networks down and no way of returning home, one businessman from Manchester told the BBC he had paid £250 for an £80 room.
...
Grant Hearn, the CEO of hotel chain Travelodge, said the price rises were a "disgrace".
...
The BBC News website received e-mails from readers who said higher than usual prices were charged by some hotels which belonged to the Thistle Group. A Thistle Group spokeswoman said: "Thistle Group did not raise their prices as a response to yesterday's tragedy, Thistle maintained their usual strategy offering the best rate available based on the fact all London hotels had been fully booked."

Some hasty stitches:

--London hotels were 80% booked Thursday night. I don't know the actual room count, but let's assume that there were 10,000 hotel rooms available and 50,000 people who wanted them. How exactly should hotels allocate their scarce supply? Is "first come, first served" necessarily a "better" or "more ethical" system than "those who value the room more should pay more for it"?

--Why do some people automatically assume, when the opportunity presents itself, that "gouging" is somehow "smart but wrong" and that businesspeople will race to engage in it? In business, "wrong" is rarely if ever "smart."

On the one hand, large chains such as hotels or home improvement stores hardly need the negative publicity (i.e., "name and shame") that comes with allegations of "gouging" just for a fleeting bump in revenues. Small, local merchants, meanwhile, would be foolhardy to alienate their local (and repeat) customers for a one-time windfall that could easily be offset by lost customers down the road.

--Buried deeper in the article:

The Hilton Metropole, located near the Edgware Road bomb blast, was used as an emergency treatment centre for casualties.

The Marks & Spencer department store on Edgware Road also allowed rescue staff to use it as a treatment unit, gave food and water to rescue teams and casualties, and also provided blankets and clothing.

A spokeswoman said: "They just did whatever they had to do. The priority was making sure the casualties were OK. That meant giving them blankets and clothing from the shop floor.

"It's what anybody would do in that situation. We are part of the community."

So much for how "greedy" and "evil" businesses are. As I mentioned above -- being a good neighbor is also being a smart entrepreneur (i.e., "smart" and "wrong" don't mix).

Maybe journalists (not to mention politicians and bureaucrats) don't understand that, but businesspeople do (and those businesspeople who don't will suffer economically in the long run anyway, just like those who irrationally discriminate).