Politicians blaming ‘price gouging’ are trying to distract you from their own failings

Junior varsity socialist Pilar Schiavo told the editorial board of this newspaper that she supports price controls on groceries “if there is price gouging.”

Varsity socialist Kamala Harris told a crowd in North Carolina, and everywhere else, “I will work to pass the first-ever federal ban on price gouging.”

Benched socialist Gavin Newsom signed a bill that his press office called the “Gas Price Gouging Law.”

Schiavo, running for re-election to the Assembly, ducked the vote for that law, which puts state regulators in charge of figuring out how much inventory oil companies must maintain and when they’re allowed to do maintenance operations in their refineries. But Schiavo told the editorial board she knows there’s price gouging by oil companies because she drives by the same gas station in Chatsworth all the time and the prices are always different.

The editorial board endorsed Schiavo’s opponent, retired deputy sheriff Patrick Gipson.

What exactly is “price gouging” and how do these politicians propose to stop it from happening?

To politicians seeking to avoid blame for policies that raise the operating costs of businesses, and excessive federal spending that causes inflation, “price gouging” is a deflection of blame in the hope that voters will not figure out that the people they voted for are causing the problems they’re having.

To stop “price gouging,” Harris promised to “set clear rules of the road to make clear that big corporations can’t unfairly exploit consumers to run up excessive profits on food and groceries” and to “secure new authority for the FTC and state attorneys general to investigate and impose strict new penalties on companies that break the rules.”

Is the federal government going to have a Department of Deciding What’s Fair and a Bureau of Defining What’s Excessive? Will food producers be subjected to endless investigations?

Obviously, Harris’ proposed policy is nonsense. It makes Richard Nixon’s “Wage and Price Controls” look well thought-out.

On August 15, 1971, President Nixon announced in a televised address to the nation that he was “ordering a freeze on all prices and wages throughout the United States” for 90 days. After that, any wage or price increases would have to be approved by a “Price Commission” or a “Pay Board.” This was obviously untenable, so it was temporary, expiring after the 1972 election.

Nixon defeated Democrat George McGovern in a landslide.

So, arguably, the policy accomplished its real goal, though it didn’t work out very well for the country. Inflation came roaring back when the artificial suppression of price increases was lifted, and in June 1973, Nixon imposed another temporary freeze.

This isn’t complicated. If the government declares that it has the power to limit price increases, everything on the shelves will sell at the controlled price, and then how are the shelves going to be refilled?

In a free country, the government can’t force people to stand still and get stuck by a policy that requires them to lose money.

What happened in the early 1970s? “Ranchers stopped shipping their cattle to the market, farmers drowned their chickens, and consumers emptied the shelves of supermarkets,” wrote Daniel Yergin and Joseph Stanislaw in their 2002 book, “The Commanding Heights: The Battle for the World Economy.”

Kamala Harris vowed, “My plan will include new penalties for opportunistic companies that exploit crises and break the rules, and we will support smaller food businesses that are trying to play by the rules and get ahead.”

Companies big and small are made up of people who are invested in them. If you’re in a pension plan or have a 401(k) or other retirement account, you’re likely experiencing the benefits of the profits of large companies, even if you’re a socialist. How does it benefit you if those profits are cut back by the government’s new rules to determine what’s “fair” and what’s “excessive?”

In Harris’ mind, such as it is, the role of government is to pick winners and losers, some that will be held back by new “rules” and others that the government “will support.”

That’s a campaign fundraising plan, not an economic policy.

Prices are high because elected officials pursue policies that increase operating costs and devalue the currency. On November 5, show them the door.

Write Susan@SusanShelley.com and follow her on X @Susan_Shelley