Food industry executives challenged Vice President Kamala Harris’ claim they are to blame for soaring grocery costs, calling her government price control plan “a solution in search of a problem.”
Harris is the Democratic nominee for president and recently accused companies of “price gouging” and said price controls were necessary to check corporate greed and bring down Americans’ grocery bills.
Food executives told The Wall Street Journal high inflation has driven up raw materials and labor costs and influenced price increases. They additionally said that healthy profit margins are necessary to finance the development of new products.
“We understand why there is this sticker shock and why it’s upsetting,” said vice president of FMI, a food supplier and retailer trade group, Andy Harig. “But to automatically just say there’s got to be something nefarious, I think to us that is oversimplified.”
Inflation has raised overall costs by around 19% during the Biden-Harris administration, with food prices decreasing 21% under Democrat control of the executive branch.
If Harris were elected president, she would ban price gouging by food suppliers and grocery stores by authorizing state attorneys general and the Federal Trade Commission to penalize companies that violate this policy.
GOP rival and former President Donald Trump blasted Harris’ “Communist price control” policy, stating the proposal would create “rationing, hunger, [and] dramatically more inflation.”
The National Grocers Association told the Journal Harris’ plan to ban the gouging of food prices “is a solution in search of a problem.”
Washington Post editorial board slams Harris’s proposal
In an opinion piece on Friday, The Washington Post editorial board slammed Harris’ proposal, calling it a “populist gimmick” when the nation needs “serious economic ideas.”
“Vice President Kamala Harris’s speech Friday was an opportunity to get specific with voters about how a Harris presidency would manage an economy that many feel is not working well for them,” wrote the board. “Unfortunately, instead of delivering a substantial plan, she squandered the moment on populist gimmicks. Americans are clearly still anxious and angry about the high cost of groceries, housing, and even $5.29 Big Macs.”
“While the inflation rate has cooled substantially since the 2022 peak, an ostensible Biden-Harris administration accomplishment, prices remain elevated relative to the Trump years,” said the board. “So, it’s a real political issue for Ms. Harris. One way to handle it might be to level with voters, telling them that inflation spiked in 2021 mainly because the pandemic snarled supply chains and that the Federal Reserve’s policies, which the Biden-Harris administration supported, are working to slow it. The vice president instead opted for a less forthright route: Blaming big business. She vowed to go after ‘price gouging’ by grocery stores, landlords, pharmaceutical companies and other supposed corporate perpetrators by having the Federal Trade Commission enforce a vaguely defined ‘federal ban on price gouging,’” continued the board.
“Never mind that many stores are currently slashing prices in response to renewed consumer bargain hunting. Ms. Harris says she’ll target companies that make ‘excessive’ profits, whatever that means. (It’s hard to see how groceries, a notoriously low-margin business, would qualify.) Thankfully, this gambit by Ms. Harris has been met with almost instant skepticism, with many critics citing President Richard M. Nixon’s failed price controls from the 1970s. Whether the Harris proposal wins over voters remains to be seen, but if sound economic analysis still matters, it won’t.”
