Kerby Anderson
You only get one chance to make a good first impression. Americans were trying to get a first impression of Kamala Harris before the Democratic National Convention. Yes, they knew something about her as vice-president, but now she was running for president.
Her first decision about personnel for her future administration was to pick Governor Tim Walz as her vice-presidential running mate. He was one of the most liberal governors or senators she could have picked.
Her first policy statement was a speech on price gouging given the Friday before the convention. Her solution was price controls. The headline of a Washington Post op-ed was: “When your opponent calls you ‘communist,’ maybe don’t propose price controls.” On radio, I suggested she might want to give her speech in the original Russian.
Price controls were a failure in the Soviet Union, in Venezuela, and even in the US when President Richard Nixon tried it decades ago. Giving more “authority” to the Federal Trade Commission to punish grocery companies who charge too much won’t solve the problem of high prices. I suspect the speech was more about trying to placate the base and appeal to swing voters by showing she “cares about people.”
Price controls won’t happen, but this is a teachable moment. Why are price controls a bad idea? First, they distort the market. The aforementioned op-ed explained it “would lead to shortages, black markets, and hoarding, among other distortions.” Second, it is hard to find price gouging as the problem. Last year, profit-margins in the grocery industry were at a low of 1.6 percent.
Kamala Harris was trying to remove one of her liabilities before she sat down for interviews. Inflation is a problem, but price controls aren’t the solution.
This post originally appeared at https://pointofview.net/viewpoints/price-controls/?utm_source=rss&utm_medium=rss&utm_campaign=price-controls
