Vice President Kamala Harris has revealed an economic plan that includes big government proposals such as grocery price controls, rent controls, and taxpayer-funded down payments for first-time homeowners.
On Friday, her campaign proposed giving up to $25,000 in taxpayer money to first-time homebuyers to use on their down payments. The program would provide more funds to buyers from families that do not own property.
“Many Americans work hard at their jobs, save, and pay their rent on time month after month,” the campaign told ABC News. “But they can’t save enough after paying their rent and other bills to save for a down payment — denying them a shot at owning a home and building wealth.”
The announcement follows a call Harris issued earlier this week to ”take on corporate landlords and cap unfair rent increases.” Her plan would limit landlords who own more than 50 units from hiking rent by more than 5% for two years, Yahoo! Finance reported. The outlet noted economists largely oppose rent control.
“Rent control has been about as disgraced as any economic policy in the tool kit,” Jason Furman, a former economic advisor for the Obama administration, told The Washington Post last month. “The idea we’d be reviving and expanding it will ultimately make our housing supply problems worse, not better.”
While Harris’ plan would only cap rents for two years, she did not address whether her plan, which is similar to one announced by President Joe Biden, would exempt newly-built units to avoid hindering new developments.
The Harris campaign also announced Friday a plan for the first-ever federal ban on grocery “price gouging,” which would effectively control costs. The campaign said Harris would implement the plan in the first 100 days of her administration. It would require the Federal Trade Commission to penalize companies that refuse to follow the dictated price controls.
Washington Post columnist Catherine Rampell criticized the plan in an op-ed.
“It’s hard to exaggerate how bad this policy is,” she wrote. “It is, in all but name, a sweeping set of government-enforced price controls across every industry, not only food. Supply and demand would no longer determine prices or profit levels. Far-off Washington bureaucrats would. The FTC would be able to tell, say, a Kroger in Ohio the acceptable price it can charge for milk.”
“… But more to the point: If your opponent claims you’re a ‘communist,’ maybe don’t start with an economic agenda that can (accurately) be labeled as federal price controls,” she continued. “We already have plenty of economic gibberish coming from the Republican presidential ticket. Do we really need more from the other side, too?”
Personal finance expert Dave Ramsey told Fox News that the price control plan would be disastrous.
“It’s not sustainable because it’s artificial,” he said. “If you just put a lid on something and if you want to explore what really happens, just go back to the 1970s. We tried it. There was a whole movement for price controls across everything, because inflation was out of control and rampant, just like it is now. And so it’s been tried. It does not work.”
“What works is to flood the market with supply,” he continued. “Lots of oil means lower oil prices. Lots of labor means lower labor prices, lots of whatever means lower prices. It’s a simple supply and demand curve. It’s called economics, and it’s called free market economics. When you insert government in it and try to artificially cramp it down, it simply does not work because you can only hold that hose for so long until the pressure builds up, and then it blows on you.”