"This is the epitome of democratic, free market capitalism?"
NO. It _may_ be what happens when you don't regulate anything i.e. anarchy or chaos. that is COMPLETELY different than suggesting ANY form of socialism would "fix" this. It is, however, human nature, for SOME people to engage in deliberate sociopathic behavior, which includes profiteering and "price gouging".
'capitalism' or 'free market' has been REGULATED since forever, in one form or another. Normally it is self-regulating through supply and demand. When monopolies, unfair trade practices (including price gouging) and exploitation occur, the existing laws are generally enough to put a stop to it.
Just like there have always been thieves [even though it is illegal to steal], there are also PROFITEERS (even though it is illegal to do this) during declared emergencies.
THAT is simply human nature, for a small percentage of people to do such things, and has nothing to do with free markets. If it were SOCIALISM or COMMUNISM, it would be "black markets". Same idea.