Kamala Wants Price Controls

Please stop talking, actually: For a while, politics watchers were wondering when in her campaign for president Kamala Harris would unveil an actual policy platform.

Now, she’s unveiled some of it, and maybe it was actually better when we knew less.

In a statement released last night, Harris’ campaign said it would enact the “the first-ever federal ban on price gouging on food and groceries—setting clear rules of the road to make clear that big corporations can’t unfairly exploit consumers to run up excessive corporate profits on food and groceries,” with enforcement power given to the Federal Trade Commission. You heard that right: price controls.

It’s not clear how an “excessive” profit would be defined, nor why policing that would be in the purview of the federal government, nor why food prices in particular ought to qualify. It’s not clear what types of behavior that are currently legal would be outlawed.

Price controls have been disastrous whenever they’ve been implemented. Prices are signals, ways of communicating how much of a good is needed by consumers and how much ought to be produced. Interfering with these signals will create terrible shortages. Giving the government the power to meddle in the economy in this way will not drive prices down, it will force some firms to go out of business and some consumers to experience shortages of goods they would have otherwise been able to purchase. The scale at which this devastation happens is contingent on the scale at which the government chooses to meddle.

In a speech tomorrow, Harris will detail her economic agenda to an even greater degree. Expect more of the same strategy: blaming big corporations for the fact that Americans’ grocery bills are substantially more expensive now than before the pandemic. But this wholly ignores the main driver of this spike in costs: inflation, which was driven in large part by pandemic-era government spending, including stimulus checks.

Both former President Donald Trump and President Joe Biden share blame for this profligate government spending, and both parties manage to obfuscate, trying to convince voters that some other force (greed?) is at work. But make no mistake: It was government recklessness that got us into this mess, and it won’t be government price controls that get us out. (It will be prudent, gradual interest rate hikes from the Federal Reserve, aimed at cooling inflation via a soft landing, which have already taken place; yesterday’s consumer price index data showed this strategy is working and that Fed officials intend to cut rates as soon as September.)

Scenes from New York: How the East River could become clean enough to swim in.

• A humble ask for you good people. If you like this newsletter, or love it, or hate-read it religiously, would you mind forwarding it to one new person who might benefit from it? I really appreciate when readers take the time to share this newsletter, whether it’s on social media or by email to a friend. As the election nears, it feels like it’s harder to distinguish signal from noise, and I hope to help make it all a bit easier.
• Since Biden dropped out, Trump has gone from being the expected winner, logging a massive lead, to…fairly neck and neck with Harris:

Today’s update. Another good day for HARRIS, who now leads in our polling average in Arizona and is only 6/10ths of a point down in North Carolina.https://t.co/vsGVG18HHI pic.twitter.com/HWHHnH7PdO

— Nate Silver (@NateSilver538) August 14, 2024

• More on Harris’ electoral odds, and Nate Silver’s predictions, here:

• Key takeaways from the July inflation report, courtesy of Bloomberg.
• “A European arrest warrant was issued for a Ukrainian man suspected of involvement in blowing up the Nord Stream pipeline nearly two years ago, Polish prosecutors said on Wednesday,” reports The New York Times.
• China’s post-pandemic economic recovery has yet to happen. “On Tuesday, central bank data showed July new bank loans plunged to a 15-year low, while other key gauges showed export growth slowed and factory activity slumped as manufacturers grapple with tepid domestic demand,” reports Reuters.
• Excellent profile in Tablet of Palmer Luckey, serial entrepreneur/wunderkind. And worthwhile takes on ADD and homeschooling here.
• Columbia University’s disgraced president finally stepped down.
• Common myths that progressive landlord-haters seem to believe, contra all real-world accounts:

Today, I discovered that some actual human adults believe:

- the majority of a rent check is profit to a building owner.

- that you can renovate an apartment after 42 years in NYC for a few thousand dollars.

- that an apartment in a 98 year old building, lived in for 4…

— Jay Martin ???? ????????️???? (@jaymart222) August 13, 2024

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