Presidential Candidate Platforms Explained: Kamala Harris' Price Controls
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So recently I started looking at my wellness routine and I wanted to see if there was any way I could enhance my results. I looked at my vitamins and I realized they were not as clean as I had thought. The list of ingredients was long with things like gelatin and artificial flavors, which obviously have no added value and can cause some digestive issues. After doing some research, I came across Vimergy. Vimergy makes liquid vitamins and supplements that use clean ingredients and are not loaded with unnecessary fillers and binders.

like citric acid. And because they're liquid, they absorb faster than tablets, gummies, and capsules. And they're much easier to take if you have difficulty swallowing your pills, which I always have. It's a whole process. I've tried putting the water in first and then the vitamins,

And unlike multivitamins, you can actually customize your vitamin routine so you only take what you need and nothing you don't. They're honestly so easy to integrate into my day. I just add them into my morning juice or smoothie and at night in my tea before I go to bed. Right now, Vimergy is offering my listeners free shipping using the code MNN. And you can save up to 12% with their Mix and Save program. That's Vimergy.com, V-I-M-E-R-G-Y.com with code MNN.

MNN, as in Money News Network. Try them today. I can't wait to hear what you think and more importantly, how you feel. When I get together with my entrepreneur friends, we often commiserate about how hard it is to hire, especially when you're on a deadline. It is such a tough hurdle to overcome because it takes a whole lot of time to search for great candidates and then sort through all the applications.

Well, if you're an employer who can relate, I have one question for you. It is the same question I ask my friends. Have you tried ZipRecruiter? ZipRecruiter has figured out how to solve this very problem. In fact, four out of five employers who post on ZipRecruiter get a quality candidate within the first day. Right now, you can try ZipRecruiter for free at ZipRecruiter.com/MoneyRehab. So I'm sure you want to know, how fast does ZipRecruiter's smart technology start showing your job to qualified candidates? Well,

immediately. And you can invite top candidates for your job to apply to encourage them to apply sooner. So relax, employers, and let ZipRecruiter speed up your hiring. See it for yourself. Just go to ZipRecruiter.com slash money rehab right now and try it for free. Again, that's ZipRecruiter.com slash money rehab. ZipRecruiter, the smartest way to hire.

I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. Money rehab.

All right. Here is the second part of this week's dive into the economic plans of the two major candidates for president, Kamala Harris and Donald Trump. If you listened to yesterday's episode, you know the deal here. As we get closer to the election, I'm going to be unpacking the major economic policies from both candidates so that you can make your own decisions about which candidate will be best for the economy. Your own personal micro economy, that is.

Yesterday, I talked about the economic cornerstone of Trump's campaign tariffs, especially on China. Today, I'm going to be looking at one of Harris's proposed policies. Harris's platform has several economic tenants to it, but I want to start with one that really captured my attention and also got a lot of criticism.

The vice president says she's going to put in place the first ever federal ban on corporate price gouging on food and groceries. Price gouging is when a business takes advantage of an emergency to raise prices. Like if your house was on fire and I told you I'd give you a bucket of water for a million dollars, that would be price gouging.

And this has really happened. Remember Pharma Bro, a.k.a. Martin Shkreli? His claim to fame, or infamy more accurately, is that he acquired the rights to a drug called Daraprim. That drug is used to treat infections that can be life-threatening for people with weakened immune systems like people with HIV.

And after acquiring that drug, Shkreli's pharmaceutical company increased the price of one Daraprim from $13.50 to $750 per pill overnight, which for those carrying the one is a 5,000% price hike.

This price gouging sparked outrage from patients, health care providers and politicians alike because Daraprim is a life-saving medication and the massive price increase made it unaffordable for so many. But this price gouging wasn't actually illegal. So Shkreli didn't face any jail time. Well, not for this anyway. He was arrested for securities fraud related to a hedge fund that he managed before he even entered the pharmaceuticals industry.

Also remember Hurricane Harvey in 2017? The Category 4 hurricane caused widespread flooding and devastation in Texas, leaving thousands of people displaced and in need of essential supplies.

In the aftermath, there were reports of businesses dramatically increasing the price on critical goods like gasoline, water, and basic food items. Bottled water was being sold for as much as $99 for one case. So what are the levers that the government typically uses to enforce a ban like this? While Harris hasn't been too specific here, she has said that this ban will quote, "build on the anti-price gouging statutes already in place in 37 states."

So to predict what this ban might look like, it's helpful to look at some of the states that have these statutes as a comp for what might be in our futures.

In New York, for example, the big component of the anti-price gouging rules is limiting the amount that a company can increase prices during an emergency. Specifically, New York says that companies can't increase prices more than 10% after a state of emergency is declared. In economics, this type of rule is called price control. And this is one of the elements that has made the plan so controversial. So what are price controls? And more importantly, do they work?

At the most basic level, price controls are government regulations that set price limits for goods and services. There are two main types: price ceilings and price floors. Price ceilings cap how high a price can go. I mean, think rent control, where the government says you can't charge more than X amount for an apartment in this area.

Price floors do the opposite. They set the minimum price. The most well-known example is minimum wage, which sets the lowest amount a worker can legally get paid. The idea behind price controls, especially price ceilings, is to protect consumers from being exploited, especially in times of crisis. The goal is to stop sellers from charging more than is fair. And in doing so, you make sure things like gas, food and even housing remain affordable.

On the surface, this sounds like a no brainer. No one likes the idea of getting ripped off when they need something crucial. But history cautions that if we aren't careful, price controls can lead to shortages, black markets and more unintended consequences. This has to do with the way price, supply and demand

interplay. For example, if a price cap makes it unprofitable for companies to supply gas or food, they might just stop doing it, leading to shortages, which defeats the whole purpose of the price control in the first place, because the big goal with price controls is, again, to make sure people get what they need. Many economists say that price controls try to fix the symptom high prices, but they don't always address the root causes like supply chain disruptions and production costs.

In some cases, allowing prices to rise can actually encourage more suppliers to enter the market and produce more goods in short supply, which can eventually bring prices down through competition. But when prices are capped, you could end up with fewer suppliers, less competition, and more scarcity. So even though price controls are all about fairness, in theory, in practice, they tend to create more problems than they solve.

Take price ceilings, for example. Imagine there's a cap on gas prices. That sounds good, until gas stations can't make enough money to cover the cost of their supply. So what happens next? They stop selling gas, or they sell less of it, creating shortages. We saw this during the 1970s oil crisis when drivers were left in long lines at gas stations.

Then there's rent control. It's meant to keep housing affordable. But in many cases, landlords respond by doing things like letting their buildings fall into despair since they can't charge enough to justify maintenance costs, or they stop renting altogether. The result? A tighter housing market, fewer available apartments, and sometimes higher rents for units not covered by controls.

We've seen this play out in New York City, San Francisco, and other major cities with strict rent controls.

That is not to say that price controls never work. They can in specific tightly regulated situations like during wartime or extremely short term crises. Fast forward to the 20th century during World War II, the US government imposed strict price controls to prevent wartime inflation. In that case, it mostly worked because the government also rationed supplies, ensuring that goods were distributed evenly and people couldn't just hoard or sell on the black market.

But as a long-term strategy, history shows us it's a risky bet. And unlike the Trump tariffs that we talked about yesterday, Harris has never been president. And this federal ban has never existed. So we don't have an exact historical analog that we can look at here.

But there are plenty of examples of price controls because they have been around for millennia. Seriously, all the way back to the Roman Empire. So for you boys who haven't gotten your fix of the Roman Empire today, I got you. In 301 AD, the Roman Emperor Diocletian imposed price controls on goods like food and clothing to curb inflation. Spoiler alert, it didn't go well.

Sellers just stopped selling at those prices, leading to shortages. People couldn't buy basic goods and it caused more problems than it solved. This is a theme you're going to pick up on.

In the 1970s, President Nixon froze wages and prices for 90 days in hopes of curbing inflation. Initially, it seemed like a success. Prices stayed low and inflation dropped. But when price controls were lifted, prices surged even higher. And businesses that had been forced to keep prices artificially low now scrambled to catch up, sending inflation through the roof.

So whether or not Harris's plan includes strict price controls, it's important to keep in mind that the devil is in the details. If they're implemented carefully and with an understanding of how markets work, they might help keep essentials affordable in a crisis. But like everything in the economy, there is no one size fits all solution.

I think what really upset a lot of people here, beyond the soundness of the economics, is that Harris did imply that corporate greed and price gouging was a meaningful driver of the inflation that we've seen in recent years. But really, the biggest driver of inflation has been interest rates, pure and simple.

And while interest rates were lower during the pandemic to keep us from going into a recession, some critics of Harris felt like this was her trying to find a scapegoat for inflation. And there are few things voters like less than feeling like they are being manipulated. But it seems like Harris took this feedback because since she originally announced the anti-price gouging plan, she's focused less on groceries and more on pharmaceuticals, where price ceilings are much more reliably problematic.

For today's tip, you can take straight to the bank. If you're looking for more resources on comparing the economic policies of Harris and Trump, check out the link in the episode description. This is a comparison by the Council on Foreign Relations, which aims to be nonpartisan and compares the two candidates on not just economic policy, but also AI, foreign affairs, and a whole lot more. But if you're curious about a deep dive on the economic issues specifically, well, keep listening, because there are more of these episodes in the works as we get closer to November.

So recently I started looking at my wellness routine and I wanted to see if there was any way I could enhance my results. I looked at my vitamins and I realized they were not as clean as I had thought. The list of ingredients was long with things like gelatin and artificial flavors, which obviously have no added value and can cause some digestive issues. After doing some research, I came across Vimergy. Vimergy makes liquid vitamins and supplements that use clean ingredients and are not loaded with unnecessary fillers and binders.

like citric acid. And because they're liquid, they absorb faster than tablets, gummies, and capsules. And they're much easier to take if you have difficulty swallowing your pills. Which I always have. It's a whole process. I've tried putting the water in first, and then the vitamins, and I don't know, just blech.

And unlike multivitamins, you can actually customize your vitamin routine so you only take what you need and nothing you don't. They're honestly so easy to integrate into my day. I just add them into my morning juice or smoothie and at night in my tea before I go to bed. Right now, Vimergy is offering my listeners free shipping using the code MNN. And you can save up to 12% with their Mix and Save program. That's Vimergy.com, V-I-M-E-R-G-Y.com with code MNN as in Honey News Network.

Try them today. I can't wait to hear what you think and more importantly, how you feel. When I get together with my entrepreneur friends, we often commiserate about how hard it is to hire, especially when you're on a deadline. It is such a tough hurdle to overcome because it takes a whole lot of time to search for great candidates and then sort through all the applications.

Well, if you're an employer who can relate, I have one question for you. It is the same question I ask my friends. Have you tried ZipRecruiter? ZipRecruiter has figured out how to solve this very problem. In fact, four out of five employers who post on ZipRecruiter get a quality candidate within the first day. Right now, you can try ZipRecruiter for free at ZipRecruiter.com slash money rehab. So I'm sure you want to know, how fast does ZipRecruiter smart technology start showing your job to qualified candidates? Well,

immediately. And you can invite top candidates for your job to apply to encourage them to apply sooner. So relax, employers, and let ZipRecruiter speed up your hiring. See it for yourself. Just go to ZipRecruiter.com slash money rehab right now and try it for free. Again, that's ZipRecruiter.com slash money rehab. ZipRecruiter, the smartest way to hire.

Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Lavoie. Our researcher is Emily Holmes.

Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehabatmoneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at Money News and TikTok at Money News Network for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself, which is the most important investment you can make.

So recently I started looking at my wellness routine and I wanted to see if there was any way I could enhance my results. I looked at my vitamins and I realized they were not as clean as I had thought. The list of ingredients was long with things like gelatin and artificial flavors, which obviously have no added value and can cause some digestive issues. After doing some research, I came across Vimergy. Vimergy makes liquid vitamins and supplements that use clean ingredients and are not loaded with unnecessary fillers and binders.

like citric acid. And because they're liquid, they absorb faster than tablets, gummies, and capsules. And they're much easier to take if you have difficulty swallowing your pills, which I always have. It's a whole process. I've tried putting the water in first and then the vitamins.

And unlike multivitamins, you can actually customize your vitamin routine so you only take what you need and nothing you don't. They're honestly so easy to integrate into my day. I just add them into my morning juice or smoothie and at night in my tea before I go to bed. Right now, Vimergy is offering my listeners free shipping using the code MNN. And you can save up to 12% with their Mix and Save program. That's Vimergy.com, V-I-M-E-R-G-Y.com with code MNN.

MNN, as in Money News Network. Try them today. I can't wait to hear what you think and more importantly, how you feel.