Vice President Kamala Harris is once again making headlines, this time with a proposal aimed at tackling the very crisis her administration played a significant role in creating: inflation.

The proposal, which centers around the imposition of federal price controls, has already drawn sharp criticism, and for good reason.

To understand the flaws in her approach, it’s essential to consider the economic context and historical precedents that highlight the potential consequences of such a strategy.

Under former President Donald Trump, the inflation rate remained relatively stable, averaging just 1.9%.

However, in the 18 months following the inauguration of President Joe Biden and Vice President Harris, inflation skyrocketed to 9.1%.

Kamala Harris and Joe Biden are the reasons why loaves of bread and ground beef are up over 50% in this country. I’m glad she finally admitted to her failures. pic.twitter.com/fQTZpBzzEk

— DEL (@delinthecity_) August 16, 2024

This sharp increase was fueled by a $5 trillion spending spree, paid for by debt and the relentless printing of money.

The Biden-Harris administration’s fiscal policies have undoubtedly played a major role in the current economic crisis, leaving Americans grappling with rising costs on all fronts.

Now, in a bid to mitigate the damage, Vice President Harris is proposing a plan that many argue will only exacerbate the problem.

The centerpiece of her plan is the imposition of federal price controls on what she describes as “greedy corporations” that she claims are “price gouging” consumers.

Specifically, Harris’s proposal includes a cap on rent increases, limiting landlords from raising rents by more than 5% annually.

Price controls are not a new concept. They have been tried before, and the results have been consistently disastrous.

Even the left-leaning Washington Post has criticized Harris’s proposal, with a pointed reminder: “when your opponent calls you a ‘communist,’ maybe don’t propose price controls.”

Kamala Harris has suggested she will look to use "price controls" to bring soaring costs down.

Someone else tried that… His name is Nicolás Maduro, the President of Venezuela.

Guess what happened to prices after 👇 pic.twitter.com/MQ3eArnAkY

— Young Americans for Liberty (@YALiberty) August 15, 2024

But beyond the political optics, the economic reality is stark. The notion that corporations are engaged in widespread price gouging is not supported by the data.

As Heritage Foundation economist E.J. Antoni points out, producer prices have risen by 19.5%, almost exactly in line with consumer prices. This indicates that businesses are not inflating prices to exploit consumers but are merely passing on the increased costs they are facing in order to stay afloat.

The San Francisco Federal Reserve echoes this sentiment, noting that “aggregate markup across all sectors of the economy . . . has stayed essentially flat during the post-pandemic recovery.”

Harris’s plan fails to recognize a fundamental economic truth: companies must raise their prices to cover rising costs if they are to remain in business.

Unlike the federal government, which can run $2 trillion deficits indefinitely, businesses operate in a reality where financial sustainability is key to survival.

The concept of price controls as a solution to inflation is not only economically unsound but historically discredited.

I asked Grok to make me an image of Kamala Harris announcing price controls. pic.twitter.com/GLr8Pccjfh

— Frank J. Fleming (@IMAO_) August 16, 2024

Back in 1971, when the United States faced a similar inflationary crisis, President Richard Nixon attempted to curb rising prices with an executive order freezing all prices and wages across the nation.

This 90-day freeze, enforced by a “Pay Board” and a “Price Commission,” proved to be an utter failure. Once the controls were lifted, inflation surged, worsening the economic situation.

Price controls have never worked, anywhere, at any time. They almost invariably lead to shortages, which in turn cause prices to spike even further, leaving consumers worse off.

This was the conclusion of a landmark study by Cliff Winston of the Brookings Institution.

Winston found that in industries ranging from oil and gas to banking, trucking, and airlines, it was the removal of price controls and a return to free-market principles that led to significant reductions in prices—on average, a 30% decrease—thanks to the competitive forces of the market.

One of the most telling historical examples of the failure of price controls can be found in the energy crisis of the 1970s. During that period, domestic oil and gas production plummeted, and prices soared, benefiting foreign producers like Saudi Arabia.

Kamala Harris talking about bringing prices down is code for price controls and dictating pricing strategies to American companies.

We already know she supports rent caps.

This is socialist garbage wrapped in centrist messaging.

pic.twitter.com/MB3yIkTWYq

— Cryptid Politics (pro-DeSantis) 🇺🇸🐊 (@CryptidPolitics) August 14, 2024

It wasn’t until Ronald Reagan’s first day in office, when he lifted all oil and gas price controls, that the market began to stabilize, and prices started to decline.

This move demonstrated the power of free market competition in driving down costs and restoring economic stability.

Kamala Harris’s proposal is not just an ill-conceived plan; it’s a fundamental misunderstanding of basic economic principles.

The vice president’s approach to solving inflation by imposing price controls will likely lead to the very problems history has repeatedly shown they cause: shortages, higher prices, and economic instability.

In the end, Harris’s plan offers no real blueprint for growth or prosperity.

Instead, it promises to expand government intervention at the expense of the free market—a strategy that history and economics both warn against. If this were an economics exam, Kamala Harris would undoubtedly receive a failing grade.

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