A prominent Harvard economist who served in President Obama’s administration has strongly criticized Vice President Kamala Harris’ proposed price control plan to curb inflation.
Jason Furman, former chair of the National Economic Council, described the plan as disconnected from reality, telling The New York Times in a report published Friday, “This is not sensible policy, and I think the biggest hope is that it ends up being a lot of rhetoric and no reality. There’s no upside here, and there is some downside.”
The Harris campaign announced on Wednesday that, if elected president, she would introduce a federal price-fixing initiative targeting large corporations to prevent them from taking advantage of consumers. The campaign statement emphasized the difference between fair pricing in competitive markets and what it described as excessive prices not tied to business costs, noting that “Americans can see that difference in their grocery bills.” The plan would empower the Federal Trade Commission and state attorneys general to impose penalties on companies that set excessively high prices.
However, Furman and other economists have raised concerns about the plan. Furman warned that such policies could discourage new businesses from entering the market to meet consumer demand, potentially exacerbating economic issues rather than resolving them.
Despite these concerns, some economists have defended Harris’ proposal. Isabella Weber, an economist at the University of Massachusetts Amherst, argued that efforts to curb what Harris calls price gouging could ensure businesses remain accountable to consumers.
Weber noted that many Americans may feel exploited if corporations thrive while ordinary people face financial hardships, suggesting that a “basic social contract” is at risk of breaking down.
Harris is expected to formally introduce this economic policy during her first policy speech of her presidential campaign in Raleigh, North Carolina, on Friday. The Harris campaign has not yet responded to a request for comment from Fox News Digital.
The proposed plan has also drawn criticism from other quarters. Personal finance expert Dave Ramsey and Washington Post columnist Catherine Rampell have both expressed concerns about price controls’ effectiveness and potential consequences. Ramsey pointed out that similar measures were attempted in the 1970s to combat rampant inflation but ultimately failed.
Rampell echoed these sentiments, arguing in a Thursday op-ed that Harris’ policy could lead to sweeping government-enforced price controls across various industries, with Washington bureaucrats, rather than supply and demand, determining prices and profit levels.
