Harris’ Soviet Era Price Fixing and a Future of Shortages, By Charles Taylor (Florida)
Vice President Kamala Harris has just released her first economic policy, that of Soviet-era price control to be "the first-ever federal ban on price gouging on food and groceries." Immediately this proposal was attacked by economists from across the political spectrum, being an "economic non-problem." According to Scott Lincicome, vice president of general economics at the libertarian Cato Institute: "Grocery prices haven't budged since January 2023. Housing prices have increased, but they're back to their pre-pandemic trend line." There was "not really any indication out there of price gouging." Apart from that, price controls have been tried at various times and have failed, leading to shortages.
As well, there is the problem that faced all command economies, of how to decide on the "correct" price of commodities. The free market does this well by supply and demand dynamics, but that is what communist Kamala wants to move against, to return to the era of Chairman Mao or Joseph Stalin.
"There's "no upside" to Vice President Kamala Harris' "Soviet-style" plan to federally set grocery prices, which she is due to unveil Friday afternoon at a rally in North Carolina — and it would likely lead to the worst supply shortages since the 1970s, economists told The Post.
The Harris campaign announced Friday that the Democratic presidential nominee would push for "the first-ever federal ban on price gouging on food and groceries" if she is elected in November. She would also deputize the Federal Trade Commission and state attorneys general to launch investigations into any companies that flout the centrally planned pricing diktats.
The policy proposals are not only "extraordinarily vague" and addressing an "economic non-problem" — but also appear to be "straight out of a five-year plan" of a Chairman Mao or Joseph Stalin-like figure, economists told The Post.
"Who exactly is going to decide what a fair price is for eggs or bread or cereal?" asked Brian Riedl, a senior economic fellow at the conservative Manhattan Institute. "Is the federal government going to come up with a Soviet-style menu of what grocery stores can charge without being punished by the state?"
The plan resembles a bill introduced by Sen. Elizabeth Warren (D-Mass.), one of whose aides recently joined the Harris campaign, that first floated the price-gouging crackdown.
"Everyone who lived through or studied the 1970s knows price controls are disastrous because they lead to shortages," Riedl told The Post. "Demand far outstrips supply. … This is why you had gas lines."
While the price controls could in the short term be "moderately disinflationary," Riedl added, Harris' other policies, such as shelling out $25,000 in down payments for any first-time home buyers, would be "absolutely inflationary."
Scott Lincicome, vice president of general economics at the libertarian Cato Institute, told The Post the plan to fix grocery prices and subsidize housing in the first 100 days of a Harris presidency also made little sense since the US is "clearly past the peak inflationary period."
"Grocery prices haven't budged since January 2023. Housing prices have increased, but they're back to their pre-pandemic trend line," Lincicome said, adding that there was "not really any indication out there of price gouging."
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