Harris’s terrible price controls proposal

Friday, August 16, 2024

"Price gouging" is the focus of Vice President Kamala Harris's economic agenda, her presidential campaign says. She'll crack down on "excessive prices" and "excessive corporate profits," particularly for groceries. So what level counts as "excessive," you might ask? TBD, but Harris will ban it. That's the thing about price gouging: As has been said of hardcore pornography, you know it when you see it. It's not hard to figure out where this proposal came from. Voters want to blame someone for high grocery bills, and the presidential candidates have apparently decided the choices are either the Biden administration or corporate greed. Harris has chosen the latter.

Posted by BellRinger at 11:03 AM | 47 COMMENTS | permalink

Comments

Something has to be done to reign in these high grocery prices. They are ridiculous to say the least.

#1 | Posted by LauraMohr at 2024-08-16 11:16 AM

Yeah price controls are stupid!!!!!1one

President Trump pledges to cut energy prices IN HALF within one year of taking office " pic.twitter.com/bPZksiL9SD" Trump War Room (@TrumpWarRoom) August 15, 2024

So you know Harris is full of it?

What's wrong with holding criminals accountable?

" Something has to be done to reign in these high grocery prices."
2.2% inflation on food in the last 12 months, according to the CPI.

"Something has to be done to reign in these high grocery prices."

You know what I used to do (before I retired) when my cost of living went up? I got a better job with a higher income.

Now my COLA takes care of it.

I find it hilarious that republicans pretend things are worse (excuse me more DANGEROUS) than they ever were.

Inflation in the 1980s was volatile, ranging from 12.5% in 1980 to 1.1% in 1986. The average annual increase over the last eight years of the decade was 3.7%, which was higher than the 1950s and 1960s

1980: The federal funds rate started the year at 14%, but by December, it had increased to 19"20%, the highest it had ever been. This led to higher consumer borrowing costs, with the average 30-year fixed-rate mortgage rate reaching nearly 20%. Six-month CD rates averaged 17.74% APY in March, and three-month CD rates averaged 18.65%.

1981: In October, interest rates reached their highest point in modern history at 18.63%. This was due to the Federal Reserve raising short-term interest rates to combat hyperinflation.
1985: By March, the average 30-year mortgage rate had cooled to around 13%.

1990: Interest rates continued to fall, ending the decade at 9.78%.

Price controls = shortages.

We saw it in the 70's with petrol.

I don't see a path to try and manage prices of specific items in a grocery store.

What is possible though?? maybe not allow a merger/acquisition of Kroger and Albertsons? That is realistic.

Determining how much is too much profit on a loaf of bread I can shop in 4 different places? (Kroger, Walmart, Aldi, Target, Dollar Store, etc) No ------ way.

Where I live there are more retail options to buy a gallon of milk than a gallon of gas.

We saw it in the 70's with petrol.

#8 | POSTED BY BELLRINGER

No you didn't. Price controls were put in place to limit inflation.

The 1970s energy crisis, also known as the 1970s oil crisis, was a period of high petroleum prices and shortages in the Western world, especially the United States, Canada, Western Europe, Australia, and New Zealand. The two worst crises of the period were the 1973 oil crisis and the 1979 energy crisis. Both crises were caused by interruptions in Middle Eastern oil exports, the first by the Yom Kippur War and the second by the Iranian Revolution.

In the 1970s, the US government imposed price controls on crude oil to prevent gasoline prices from rising too quickly. The controls were part of a larger program to manage production and limit inflation. The controls were a response to the Organization of Petroleum Exporting Countries (OPEC) causing fuel prices to increase

Dinger headlines are always hilarious.

'price control proposal"

riiiiight....so that's what the WH talking point says.

2013 Maduro did the same thing to combat "corporate greed" in Venezula.

and their inflation graft jumps up as straight and high as the " female -------- cancer" rate has gone in "woke" america.

Maybe I should buy that condo.....next to the city zoo.

#12 | POSTED BY SHRIMPTACODAN

I bet they have an even more affordable place for you.

IN the city zoo.

Vs. business as usual.

What is possible though?? maybe not allow a merger/acquisition of Kroger and Albertsons? That is realistic.

Determining how much is too much profit on a loaf of bread I can shop in 4 different places? (Kroger, Walmart, Aldi, Target, Dollar Store, etc) No ------ way.

The former is where this proposal is targeted, at the wholesale levels, not at the retail levels. There is already a bill before the Senate with many of the targets and goals in the Harris proposal. I watched Sen. Casey talk about this on tv and I've posted multiple threads pointing out the same numbers and trends.

Corporations that produce goods used the pandemic issues to raise their profits to record levels by increasing the wholesale prices of their products. Then, they actually wrote memos and shareholder reports detailing exactly how they did it to raise profits by using increasing supply chain costs as public cover. And because of mergers and consolidations, there is already less competition in many markets, and instead of competitors holding to lower - yet profitable - prices to gain additional market share, companies simply raised their own prices to match competitors and satisfy their investors while consumers bore all these costs themselves.

I have no idea how this would work in practice, but I certainly understand the political calculus for making this case. I just heard a Republican admit that inflation numbers have gotten markedly better while then lamenting "Why wasn't something done years ago(?)" Harris needs to be able to pivot with a true answer - because we started working on inflation years ago is one of the reasons we're seeing the downward trends we are today. And one of the big things I can think of that's helped was the strategic release of our oil reserves into the market when OPEC was trying to cut production and drive prices even higher to intentionally hurt America and Biden. The sales turned a profit for the government AND helped keep pump prices from exploding more than they did.

Bellringer: "pRicE cONtroLS WIll dEStrOY tHE mArKEt!"
Dairy Farmers: ...?

"when OPEC was trying to cut production and drive prices even higher to intentionally hurt America and Biden"

I realize this is an entirely different subject but why would OPEC want to hurt Biden?

I'm not asking about US companies that might collude with OPEC...but OPEC itself.

@#8 ... We saw it in the 70's with petrol. ...

Analysis: Background: What caused the 1970s oil price shock? (2011)
www.theguardian.com

... There were a series of energy crises between 1967 and 1979 caused by problems in the Middle East but the most significant started in 1973 when Arab oil producers imposed an embargo.

The decision to boycott America and punish the west in response to support for Israel in the Yom Kippur war against Egypt led the price of crude to rise from $3 per barrel to $12 by 1974.

The price of petrol rocketed, making all transport more expensive. There was even talk in Britain of rationing using coupons left over from the second world war. ...

#17

Sorry. To me, OPEC is MBS - who's also in cahoots with Putin - since SA tacitly controls the organization.

You should now know the answer to the rest of your question.

1990: Interest rates continued to fall, ending the decade at 9.78%.

This is false.
www.macrotrends.net

FYI: #18 | Posted by LampLighter
From #8: The controls were a response to the Organization of Petroleum Exporting Countries (OPEC) causing fuel prices to increase.

If Harris tries to implement what the article states (Warren's old plan), then you can eventually expect shortages similar to what all "controlled economies" have experienced.

I have no idea how this would work in practice, but I certainly understand the political calculus for making this case.

The article states it perfectly.

The most likely template for Harris's proposal is a recent bill from Sen. Elizabeth Warren (D-Mass.). (Harris co-sponsored similar legislation with Warren in 2020, when Harris was a senator.) Warren's bill would ban any "grossly excessive price" during any "atypical disruption" of a market. Alas, no definition was provided for these terms, either; rather, the bill would empower the Federal Trade Commission to enforce bans using any metric it deems appropriate.

The political calculus is to appease the peasants/plebs in the short term, but really to build in the long term yet another yoke on corporations to toe the party line.

See this is where it would get crazy over time, where favorites would be played etc etc. It becomes a political weapon. Used to subjugate the undesirables.

There are an enormous amount of literature on this in Russian and Chinese. The argument against "price control" lead to a more free and prosperous China as we embraced "capitalism" in many ways. Feel free to educate yourself, the closest thing I have read about the intricacies to the argument in English is "The Road to Serfdom" by Hayek.

@#20 ... This is false. ...

What is the "this" your current alias' comment refers to?

If it is the "1990: Interest rates continued to fall, ending the decade at 9.78%" the link your current alias provided seems to support that..

If it is my #18 comment, I see nothing in your comment that shows how my #18 was false.

So I'll say my #18 again...

Analysis: Background: What caused the 1970s oil price shock? (2011)
www.theguardian.com

... There were a series of energy crises between 1967 and 1979 caused by problems in the Middle East but the most significant started in 1973 when Arab oil producers imposed an embargo.

The decision to boycott America and punish the west in response to support for Israel in the Yom Kippur war against Egypt led the price of crude to rise from $3 per barrel to $12 by 1974.

The price of petrol rocketed, making all transport more expensive. There was even talk in Britain of rationing using coupons left over from the second world war. ...