Price Gouging

Two ways we can stop modern technology from distorting markets to nickel-and-dime everyday consumers.

1) Surveillance Pricing

Should two people pay different prices for the same item, from the same store, at the same moment?

Increasingly, they do. Retailers now use algorithms that draw on your location, your browsing history, your past purchases, and even how you move your mouse across a webpage to estimate the most you’ll pay.¹ Then they charge you that. The Federal Trade Commission has described how such a system could charge a new parent more for baby products, because the algorithm knows a new parent is less likely to shop around.² Regulators call this “surveillance pricing.”

This isn’t a fringe practice. The FTC found that the pricing firms it investigated work with at least 250 businesses, including grocery stores, apparel retailers, convenience stores, and hardware stores, and that retailers use these tools in physical stores as well as online.³ Nor is it new. More than a decade ago, the Wall Street Journal found that Staples showed customers different online prices depending on how close they lived to a competitor’s store.⁴ What has changed is the volume of data. A retailer once knew your ZIP code. Now it can know your demographics, your credit history, and how badly you need what you’re buying.

Prices do a job in a free market. They tell you what something costs, let you compare sellers, and force sellers to compete for your business. Surveillance pricing breaks all three. When every customer sees a different price, no one can tell whether they got a fair deal, comparison shopping stops working, and the seller no longer competes on price at all. It simply charges each customer the most that customer will bear. That isn’t a free market. It’s a market where only one side can see the numbers.

Some will say retailers have always charged different people different prices. A senior discount, a veterans’ discount, or a student price all mean two customers pay different amounts. But those discounts differ from surveillance pricing in every way that matters. The store posts them publicly. Anyone who qualifies gets the same price. And every customer knows exactly why the price changed. Surveillance pricing works the opposite way. The price is secret, it applies to you alone, and no one tells you why you paid more. You can’t comparison-shop against a price built for you personally.

Michigan should ban it. No business should set an individual’s price using personal data run through an algorithm the customer cannot see. Published discounts available to everyone in a group remain legal, and so do prices that rise and fall for every customer with supply and demand. The rule is simple: a business can charge what it wants, but it has to charge everyone the same price for the same terms. Michigan already has the tool to enforce it. The Consumer Protection Act lists the unfair practices the Attorney General can pursue. Surveillance pricing belongs on that list.

Michigan wouldn’t act alone. Maryland, Connecticut, and New Jersey all enacted bans this year.⁵ In August, the FTC proposed treating undisclosed personalized pricing as a potentially deceptive practice under federal law,⁶ months after senators from both parties urged the agency to crack down.⁷ Most state laws so far cover only groceries. Michigan should lead the way by covering all retail.

2) Your Car is Reporting on You

Who decides what your car insurance costs? In 2019, Michigan answered part of that question. The state’s auto insurance reform barred insurers from setting rates based on sex, marital status, home ownership, credit score, education, occupation, or zip code.⁸ The principle was sound: your premium should depend on how you drive, not on who you are.

But that principle leaves a second question open: who gets to tell your insurer how you drive?

For millions of drivers, the answer was their own car. According to the Federal Trade Commission, one automaker recorded drivers’ hard braking, rapid acceleration, speeding over 80 miles an hour, seat belt use, and the times they turned the car on and off, in some cases every three seconds. It then sold that data to data brokers, which packaged it into driving reports for insurers.⁹ Drivers never knowingly agreed to any of it; the FTC found the company signed them up through a misleading enrollment process.¹⁰ One Chevrolet Camaro owner saw her premium jump 80 percent after the automaker shared 603 records of her driving.¹¹

Some insurers offer programs that track your driving in exchange for a discount. You sign up, you know what the insurer sees, and you can quit whenever you want. That arrangement works like a senior discount: transparent and voluntary. What the automaker did works like surveillance pricing: secret data, a hidden model, and a higher bill.

In January, the FTC barred the company from sharing driving data with consumer reporting agencies for five years.¹² But five years is not forever, and the order covers only one company. Other automakers have shared driving data with the same brokers.¹³

Michigan should close the gap for good. No automaker, app, or device maker should share your driving data with an insurer or data broker without your separate, explicit consent, not a checkbox buried in an enrollment screen. Voluntary programs you sign up for directly with your insurer remain legal. And every Michigan driver should have the right to see what data their car has shared, and with whom.

Michigan already decided that your premium should reflect how you drive. So Michigan drivers should decide who gets to report it.

Federal Trade Commission, “Surveillance Pricing 6(b) Study: Research Summaries, A Staff Perspective,” January 2025. https://www.ftc.gov/system/files?file=ftc_gov%2Fpdf%2Fp246202_surveillancepricing6bstudy_researchsummaries_redacted.pdf

Today’s General Counsel, “FTC Report Examines Surveillance Pricing and Its Impact on Consumers,” January 28, 2025. https://todaysgeneralcounsel.com/ftc-report-examines-surveillance-pricing-and-its-impact-on-consumers/

Jennifer Valentino-DeVries, Jeremy Singer-Vine, and Ashkan Soltani, “Websites Vary Prices, Deals Based on Users’ Information,” Wall Street Journal, December 24, 2012.

Stateline, “States begin banning ‘surveillance pricing’ that uses personal data to charge more,” August 4, 2026. https://stateline.org/2026/08/04/states-begin-banning-surveillance-pricing-that-uses-personal-data-to-charge-more/

Fortune, “FTC moves to make retailers disclose use of ‘personalized pricing’ as technology now enables broad consumer surveillance,” August 24, 2026. https://fortune.com/2026/08/24/ftc-retailers-personalized-pricing-consumer-surveillance/

Letter from U.S. Senators to FTC Chairman Andrew Ferguson on surveillance pricing, December 17, 2025. https://www.warner.senate.gov/wp-content/uploads/media/doc/251217.Ferguson_Warner_Hawley_Blumenthal_Gallego_re_surveilliance_pricing.FINAL.SIGN.pdf

State of Michigan, “Auto Insurance Reform: Consumer Protections.” https://www.michigan.gov/autoinsurance/law-changes/consumer-protections

Hendershot, Lane & Associates (HLA Law), “Your Car Has Been Recording How You Drive, and Insurers Have Bought That Data,” September 30, 2026. https://www.hlalaw.com/2026/09/30/car-driving-data-insurance-florida/

ProgramBusiness, “FTC Finalizes Order on GM and OnStar Data Collection and Disclosure Practices,” January 2026. https://programbusiness.com/news/ftc-finalizes-order-on-gm-and-onstar-data-collection-and-disclosure-practices/

GM Authority, “FTC Says GM And OnStar Were Watching and Selling Your Every Move,” January 2026. https://gmauthority.com/blog/2026/01/ftc-says-gm-and-onstar-were-watching-and-selling-your-every-move/

Parker Poe, “FTC Finalizes Order Alleging Improper Collection and Sale of Geolocation Data,” January 2026. https://www.parkerpoe.com/news/2026/01/ftc-finalizes-order-against-gm-onstar

Hendershot, Lane & Associates, ibid. (senators reported that Hyundai and Honda also shared driving data with Verisk).