4 minute read
Price Controls
THOMAS MCARDLE was a White House speechwriter for President George W. Bush and writes for IssuesInsights.com. Thomas McArdle
Bezos Versus Bozos
Amazon founder calls out the president for peddling disinformation
It’s interesting in the extreme that Jeff Bezos, the second-richest man in the world, Amazon founder, self-propelled astronaut, and confirmed liberal who lavished the Obama Foundation with $100 million and bought (likely saving) The Washington Post, which he then turned into a leading digital media innovator, is now an unlikely enemy of the Biden administration.
Earlier this month, America’s toughest 79-year-old once again falsely accused oil companies of gouging consumers, demanding of them: “Bring down the price you are charging at the pump to reflect the cost you’re paying for the product. And do it now.”
In response, Bezos posted to Twitter: “Ouch. Inflation is far too important a problem for the White House to keep making statements like this.”
He accused Biden and his handlers of “either straight ahead misdirection or a deep misunderstanding of basic market dynamics.”
Bezos knows full well how the policies of the party he supports add big costs to gas at the pump. A few years ago, there were 1,600 rigs in this country finding and drilling oil. Today, there’s only a fraction of that number, as big-government environmentalists wage war on fossil fuels.
Apparently, we actually have in Bezos a Democratic donor who has become embarrassed at the lies he’s helped finance.
It didn’t take long for White House press secretary Karine Jean-Pierre to enter the fray, replying to Bezos on Twitter: “I guess it’s not surprising that you think oil and gas companies using market power to reap record profits at the expense of the American people is the way our economy is supposed to work.”
If President Biden and those around him really feel that way, if they really believe that companies shouldn’t be “using market power,” then, for the sake of the U.S. consumer, why not impose price controls? After all, the price controls of the early 1970s were bipartisan, with Richard Nixon signing the Economic Stabilization Act passed by a 91st Congress with massive Democratic majorities in both the House and Senate, establishing a federal Price Commission to which Nixon appointed government bureaucrats who would dictate how much sellers would charge for their wares.
Not very many years later, another president would insist that “government wage and price controls have never worked in peacetime. They create unfair economic distortions, and they hurt productivity.”
You might imagine that this was spoken by Ronald Reagan. It was actually Jimmy Carter who made the statement in the midst of his presidency’s meltdown in the spring of 1980. But, as if playing the lead in some black comedy, right after Carter bemoaned the failure of price controls, he proceeded to announce the beefing up of the federal Council on Wage and Price Stability— President Gerald Ford’s successor to the Price Commission—to shame businesses into “voluntarily” setting prices, following the advice of federal bureaucrats.
“We simply cannot outlaw inflation with a massive federal bureaucracy or wish it away with a magic formula,” Carter assured us. “On the other hand, voluntary wage and price restraints offer the flexibility we need to deal with our complex economy” with prices determined by “a tripartite advisory committee, with members from business, labor, and the public.”
He announced that the council’s “current staff of 80 people will be more than tripled.”
“We will investigate wage and price increases that seem out of line with the standards. I mean to apply these standards with vigor and toughness to both business and labor,” Carter said.
Voluntary, huh?
So even though “controls have never worked,” government-devised “standards” backed by political pressure surely will?
A few years earlier, President Gerald Ford had donned a “WIN” button (Whip Inflation Now) and encouraged “carpooling, taking the bus, riding bikes, or just plain walking.”
The principle for both Democrat Carter and Republican Ford was the same: The cause of inflation is an excess of freedom in a market that lacks government management—if not explicitly by law, then by intimidation.
The first major decision Jeff Bezos made after purchasing The Washington Post newspaper group was to abolish the online paywall for subscribers of the Dallas Morning News, the Honolulu Star-Advertiser, the Minneapolis Star-Tribune, and other publications under its control. Guess what—businesses know that customers who make them money are happy customers, customers who don’t feel cheated.
Does anyone really believe that Bezos’s creation, Amazon, attracted tens of millions of consumers by gouging them? And does anyone really think Amazon would have fared better following the price recommendations of some Council on Price Stability in Washington?
Making prodigious profits for the benefit of those who freely buy is “the way our economy is supposed to work.” That is, indeed, “market power,” which is to say, liberty.
