A Harvard economist who served in President Obama’s administration criticized Vice President Kamala Harris’ price control plan to curb inflation as “unrealistic.”
“This is not a sensible policy and I think the biggest hope is that it ends up being a lot of rhetoric and no reality,” Jason Furman said in a New York Times report published Friday. “There are no benefits to this and there are some downsides.”
Harris’ team announced Wednesday that as president she would introduce a nationwide corporate price-fixing plan to prevent “big corporations” from taking advantage of consumers.
“There is a big difference between fair prices in competitive markets and inflated prices that are disproportionate to the cost of doing business,” the Harris campaign said in a statement. “Americans can see that difference in their grocery bills.”
Liberal Washington Post columnist says Harris’ price controls sound like ‘communism’
Democratic presidential candidate US Vice President Kamala Harris will present her price control policy on Friday. ((Photo by Andrew Harnik/Getty Images))
The proposal would give the Federal Trade Commission and state attorneys general the power to impose tough penalties on companies that set excessive prices.
However, some economists and financial experts express doubts about Harris’ plan, arguing that companies do not play a major role in increasing food prices.
Furman, a former chairman of the National Economic Council under Obama, told the Times that policies like Harris’s are risky because they discourage new companies from entering the market to meet consumer demand.
Other economists disagreed and praised Harris’ proposal to the Times.
DAVE RAMSEY EXPLAINS WHY KAMALA HARRIS’ PRICE CONTROL PLAN WILL NOT LIMIT INFLATION: ‘IT’S NOT SUSTAINABLE’
Financial expert Dave Ramsey and Obama economist Jason Furman said Harris’ price control plan would not work. (iStock)
Isabella Weber, an economist at the University of Massachusetts Amherst, argues that Harris’ efforts to curb what she calls price gouging could help hold companies accountable to consumers.
Weber told the Times that people might feel exploited if corporations thrived while “ordinary people” were struggling financially.
“A kind of fundamental social contract is crumbling,” she said.
Harris is expected to discuss economic policy during her first official keynote speech of her presidential campaign in Raleigh, North Carolina on Friday.
The Harris campaign team did not immediately respond to a request for comment from Fox News.
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Her policies have also been criticized by financial expert Dave Ramsey and liberal Washington Post columnist Catherine Rampell.
“We tried it in the 1970s,” Ramsey told Fox News host Laura Ingraham on Thursday. “There was a whole movement for price controls across the board because inflation was out of control and rampant, just like it is today. And that’s what we tried. It doesn’t work. What works is flooding the market with supply.”
“It is hard to overstate how bad this policy is,” Rampell wrote in a Comment published on Thursday“It is, in all but name, a comprehensive set of government-enforced price controls on all industries, not just food. Supply and demand would no longer determine prices or profit levels. That would be done by far-away bureaucrats in Washington. The FTC could, for example, tell a Kroger in Ohio what an acceptable price it could charge for milk.”
Fox News’ Jeffrey Clark, Jamie Joseph and Alec Schemmel contributed to this report.
