Price Controls Won’t Solve America’s Inflation Problem: Jonathan Williams in The Daily Caller
Candidates may disagree on economic policy, but the lessons of history are clear: price controls are not the answer.
Jonathan Williams, ALEC Chief Economist and Executive Vice President of Policy, authored an op-ed in The Daily Caller arguing that price controls won’t solve America’s inflation problem. He explains that despite efforts by big-government advocates to revive this approach, history shows price controls have consistently failed as a tool to curb inflation.
As inflation steadily erodes the American family’s ability to afford basic necessities — food, housing, and transportation — big government advocates have resurrected an antiquated and discredited policy idea: government-imposed price controls.
On the surface, price controls may seem like an easy fix for rising costs. However, as Economics 101 and millennia of history have shown, such measures are doomed to fail from the very start.
Yet, big government enthusiasts, emboldened by favorable polling and seemingly advantageous political conditions, are pushing forward with this failed idea. A recent headline from the progressive outlet The Atlantic even urged, “Sometimes You Just Have to Ignore the Economists.”
But back in the real world, prices are not set by political campaigns or government bureaucrats. Prices are determined by buyers and sellers, through the natural forces of supply and demand. This decentralized process constantly adjusts prices based on a wide range of factors, large and small.
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As we navigate the political campaign season, proposals like price controls are often more about winning votes than solving real problems. The great Ronald Reagan famously said: “We don’t have inflation because the people are living too well. We have inflation because government is living too well.” Reagan’s simple wisdom rings true today.
Candidates may disagree on economic policy, but the lessons of history are clear: price controls are not the answer. Instead, we need to focus on the real driver of inflation — reckless federal overspending in Washington, D.C.