Policy versus Vision: Price Gouging

In several recent essays, I’ve been trying to expound on the differences between policies and vision (The best one is here.) In the past, I’ve made the mistake of implicitly criticizing our Democratic candidate and have drawn friendly fire.

But the point is general. It applies to both parties and both campaigns. The campaign that best “gets it” is likely to win this most consequential election in US history.

Already the distinction has been important, if not decisive, in the victories of Bill Clinton over George Herbert Walker Bush in 1992, of George W. Bush over Al Gore in 2000 and over John Kerry in 2004, and of Barack Obama over John McCain in 2008. This year, it could make the difference between continuing and ending our American Experiment.

The distinction between policy and vision is simple but profound. Policy is the means to an end. Vision is the end itself. It’s the difference between “Deterring Aggression” or “Peace through Strength,” on the one hand, and “A World Without War” on the other.

If the end is attractive, as it usually is, articulating a vision succinctly can be a powerful campaign tool. Examples of effective visions are George W. Bush’s “No Child Left Behind” and “[Home] Ownership Society” in 2004 (ironically offered mere years before the Crash of 2008 and its millions of mortgage foreclosures).

Like it or not, Trump’s annoying slogan “Make America Great Again” is another effective vision: it helped him win the first time. It illustrates, perhaps as does no other, the value of generality and the superfluousness of specifics.

Examples on the Democratic side are fewer because the GOP and its candidates have been much better at creating simple visions. No doubt the GOP’s supremacy in this vital political arms race is due in part to the GOP being the “party of business.” As such, it can draw on American business’ vast expertise in marketing, advertising and promotion.

Whatever the reason, stating and promoting visions is a skill that the Dems can learn. It’s never too late to apply it and win. Turning up one’s nose at this vital political skill is precisely the kind of mindless elitism and snobbery that has been threatening to make the Dems a minority party for most of my adult life—despite clear supremacy in policies to make ordinary people’s lives better. It does nothing to have more and better policies if you can’t convince voters that you do.

The issue of price gouging by business in a time of general inflation is a classic case in point. “Price gouging” is a universal no-no. The very term “gouging” evokes a boxer trying to gouge out his rival’s eyes, surely a violation of the Marquis of Queensbury’s Rules for Boxing. Who in God’s creation is for price gouging? No one except the gougers.

So promoting a vision like “Fair Prices,” “Stop Price Gouging” or “No Price Gouging” is a no-brainer. In a time when increases in the prices of groceries, although moderating somewhat recently, are on everyone’s mind, it’s a powerful vision. No one can bad-mouth it.

But the GOP has made an end run around the Dems on this issue. It’s done so not by attacking the vision directly, but by attacking what Republicans see as the underlying policy: price controls.

It doesn’t really matter whether Vice-President Harris has actually advocated price controls. The mere accusation that she has has changed the subject from the evil, price gouging, to the Vice-President’s realism and economic knowledge.

It’s classic free-market economics that price controls don’t work. In desperation, during the massive inflation caused by the Arab Oil Embargo, even Richard Nixon tried them, and they didn’t work for him.

I think that limited, carefully targeted and temporary price controls might work. But that’s a conversation fit for economic experts. It would make ordinary voters’ eyes glaze over. By attacking Harris on her presumed policy—price controls—whether or not she actually advocated them, the GOP has changed the subject from a universally desired end to Harris’ economic competence and the details of market theory.

The fact is, there are several ways to address price gouging besides price controls. The first is simple shaming. It would be hard for any firm to price gouge on groceries across the entire country, simply because, in most markets, there is no monopoly or even duopoly over food. So most price gouging, if and when it occurs, likely occurs in limited geographic markets and in limited time frames. Simply by calling out a price gouger in a limited market, the government could encourage consumers to boycott that producer and rivals to enter that market.

If the government wished to be even more active, it could arrange to transport or subsidize imports into that market to increase supply, lower prices, and discipline the gouger. And all this could be done without a hint of government specifying what the market price should be, i.e., of “price controls.”

A second effective approach to price gouging would be more robust enforcement of our antitrust laws. Antitrust laws are designed to protect competition from self-interested producers and sellers. They outlaw monopolists abusing their market power and supposedly rival producers colluding to raise prices.

Our Antitrust Division of the DOJ, and a now-enlightened FTC, could punish price gouging by creating a “rapid response force” to go after it legally. (Explicit price-fixing among competitors is a jailable offense.) The fact our antitrust authorities have been virtually asleep at the switch for a generation presents no general impediment to this remedy.

More generally, the government can stop price gouging everywhere by addressing the economic conditions that make it possible. Usually those conditions are temporary and transient, which is why the government has to act fast. But there’s absolutely no insuperable impediment to the government doing so. And even the government’s preparation and threat to do so would be a powerful disincentive to gouging in local markets.

But the main point here is a much, much simpler one. As the old saw goes, there’s always “more than one way to skin a cat.” By allowing the GOP to shift the focus from fighting gouging to price controls, the Dems’ campaign has taken a hard and needless jab to the chin.

“Fair Pricing” and “No Price Gouging” are visions that every voter can get behind. How to implement those visions gets down in the weeds of economic policy, where most voters have no desire to go. By keeping her eye on the good vision, with realistic policies to realize it in reserve, Vice-President Harris can hold the high ground and win this election, on this narrow issue as on so many others.

Finding exactly how best to realize the vision is a question for Harris and her team to address once in the White House. No one, except for gougers themselves, is for price gouging.


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