If the stores were to follow Hayek’s teachings in this scenario, then they would let the forces of demand and supply speaks to the people and not set the prices themselves. According to Hayek, the best social planner is the twin forces of supply and demand. Allowing the limited supply to dictate the price is the only way, people with the most need for the products will acquire them (Friedman, 2016). The reason behind Hayek’s logic is that the process of bidding for the highest price will eliminate all the individual whose purpose for the product is not urgent. Hayek gave an example of a shortage of refrigerants during a crisis. If the force of demand and supply were allowed to set the price, then people who only need the refrigerants for life-saving purposes can acquire them because of the high price. The process will lock out the individual who just needed the refrigerants for beer cooling purposes (Hayek, 2012).
Hayek’s advice to Obama on this matter will closely relate to his philosophy on the right to distribute. He will first question Obama’s right to distribute the supplies to the affected people (Hayek, 2012). After ensuring that the supplies are for Obama to distribute, then Hayek would go further and insist that a centralized plan for distribution is not needed. According to him, if the goods were to be distributed on merit, then centralization will only reward obsequiousness. Distribution of the supplies based on merit meaning that the supplies will be given to those who deserve them is a solid plan. However, centralization of this process will make it intolerable. In summation, Hayek would advise that the distribution of the supplies be decentralized.
Friedman, J. (Ed.). (2016). Hayek’s Political Theory, Epistemology, and Economics. Routledge.
Hayek, F. (2012). Stanford Encyclopedia of Philosophy. Retrieved June 12, 2018, from Stanford: https://plato.stanford.edu/entries/friedrich-hayek/#HayeAgaiJust