That’s a Rip Off!!!

Why is scalping a crime? I’ve never been able to figure this out. What’s scalping?

To resell at a price higher than the established value: scalping tickets to the baseball game.

What is “established value”? Established value refers to the price printed on the ticket. In other words it’s the price that the box office of the venue or the performer has decided to sell the ticket for. So the simple answer to this question is, scalping is a crime because you’re ripping someone off by selling them something that isn’t worth what you asked them to pay you.

But is that a crime? Yes there’s a law on the books making it illegal, so technically it is, but should it be? I take issue with this notion that there’s anything wrong with this transaction. That mostly comes from the fact that I truly don’t believe there’s any such thing as a rip off.

No such thing as a rip off? Wouldn’t a rip off be when you pay more than something is worth? That’s just it. What is value? How do you determine something’s worth? Value is not defined by what a business man in an office decides something is worth. Sure he has computer regression models to see historical trends on how much things are generally charged, but he can’t really know what something’s value is. Why? Because value is defined by the buyer.

If I pay $12 for a cheeseburger, that cheeseburger is worth $12 to me. If I want to get into a baseball game so badly and can’t find tickets, so I go buy them from some guy in the street and pay $300 for a nosebleed ticket, then that ticket is worth $300 to me. I was willing to pay that much for that ticket, therefore the ticket had that high of a value for me.

Let’s take a real world example. After Hurricane Katrina, grocery stores started raising their prices on things like milk. They were decried as being price gougers – vilified for taking advantage of poor people in a desperate situation just to make an extra buck. That couldn’t be further from the truth! With the roads jammed and messed up, it was likely that the next shipment of supplies was going to be long in coming, so the stores had to make do with what they had. At the same time, people were starting to stockpile things. Demand went through the roof. Supply went through the floor. In order to keep from selling out of milk in the first day to people who were buying 20 gallons, and making sure that everyone who really needed the milk got the milk, they raised the price. This discouraged anyone from buying unless they really needed it. And it worked.

Let’s go back to the baseball game. The box office doesn’t know every variable that goes into the value of that ticket. Suppose I’m a bit older and my son is a player, and he just got called up from the minors to make his big league debut. Now, I know my scenario is a bit flawed, because the team would probably give me tickets in that situation, or my son my buy them for me or whatever, but just for the sake of argument, run with it. If I can’t find a ticket except from a scalper, I’d be willing to pay just about anything to get in the doors. I don’t care if it’s a nosebleed ticket, I’ll pay whatever the guy asks, because it’s worth it to me to be in the stands when my kid steps to the plate, or on the mound for the first time.

Maybe that scenario’s too far fetched. Let’s say you’re just a regular Joe who is going to the game and forgot to pick up tickets ahead of time, and you’re walking along and rather than waiting in line at the box office – or perhaps because they’re sold out – you decide to buy from a scalper. If you don’t want to pay more than face value for a ticket, then have the guy show you the ticket before you buy. If you don’t, you’re a dupe. If he won’t show it, then either don’t buy, or if you do buy you ought to be aware that you’re probably paying more than the price printed on the front. If you do that, you’ve willingly gone along with this scheme. What crime has been done against you at this point?

The problem in this country is that we’re shielded from the notion of value. We don’t heckle in the marketplace any more, so we don’t understand what it means to really get a good deal. The fact of the matter is, if you’ve paid for something, whether it’s at Walmart or from a guy on the street, you’ve not been ripped off. Nobody can rip you off but yourself, because you are willing to pay for it. If you see something you want that’s priced higher than you’re willing to pay, don’t buy. If you do, you’ve ripped yourself off. Conversely I think we’ve done a disservice to sellers. By not allowing the prices to be flexible on a lot of things, we’ve robbed them of situations where a buyer really does place a higher value on something, but a fixed price structure allows him to pay less. In that sense, we’ve almost ripped off the seller!

Just my two cents.