Kamala Harris' Inflation “Solution”: Nixon's Price Controls and Trump's Tax Policy

President Joe Biden has given Vice President Kamala Harris a short enough campaign season to avoid any scrutiny from the Democratic hagiographers in the media, but in theory Harris could draw on her failed 2020 presidential bid to pad her currently nonexistent list of policy proposals.

But although Harris claims she never supported nationalizing 30 percent of the U.S. economy and banning private health insurance and fracking, she has taken a whole month to outline her new fiscal agenda during various presidential campaigns. She is adopting former President Richard Nixon's tried and tested and failed doctrine of price controls. And, oddly enough, she is trying to steal the current tax proposals of her opponents: former President Donald Trump and Senator JD Vance (Republican, Ohio).

Just months after Trump deviated from Republican orthodoxy and advocated exempting tips from income taxes for service workers, Harris announced the same policy as her very first economic proposal as her party's presidential candidate. It's odd enough to adopt your political opponent's idea without citing sources, but it's even odder that the Biden-Harris administration has deliberately increased IRS enforcement to more of workers who receive tips. And her PRO Act proposal would raise taxes on those workers even higher. Harris contradicts her own administration's policies without admitting it.

Then, just days after Vance endorsed a $5,000 child tax credit, Harris announced her support for a $6,000 child tax credit.

Where Harris really has the edge is her main solution to inflation, created by her tie-breaking votes for the $1.9 trillion American Rescue Plan and the $1.3 trillion Inflation Reduction Act. In response to a 20% increase in overall prices since she took office as vice president and a 4% decline in real average weekly wages, Harris has taken a page from a president who ushered in the only inflation cycle worse than the one she and Biden fueled: former President Richard Nixon.

Like Nixon, Harris wants to curb the inflation she has caused through literal price controls.

The vice president's new plan is a version of a bill authored by Senator Elizabeth Warren (D-Mass.), which Harris helped introduce during her time in the Senate, that would freeze food prices nationwide by empowering the Federal Trade Commission (FTC) and state attorneys general to “investigate and penalize food companies that violate the federal ban.”

The Nixon Shock was decreed with a similar goal in mind and resulted in a predictable disaster. As Harris and Biden had attempted with an unprecedented series of $2 trillion annual deficits, Nixon wanted to deliberately devalue the US dollar, which he succeeded in doing by blowing up the Bretton Woods international monetary system, but with disastrous consequences, and by using price controls to avoid the inevitable consequence of inflation.

Although these Nixon price controls received temporary applause from the economic illiterates of the New York Timesthey only delayed and exacerbated the inevitable. Long before the start of the Arab oil embargo, which is retrospectively blamed disproportionately for the stagflation of the 1970s, Nixon's price controls led to dramatic shortages of gas and energy. When the price and wage controls, which Nixon said were only to last 90 days, were lifted two years later, inflation doubled from an annual rate of 3% in 1972 to 6% the following year, and 11% the year after that.

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Harris' plan would prove no less idiotic, and perhaps even more so given the goal. Unlike the rest of the private sector, which averages an 8.5% profit margin, grocery store profit margins average just one percentage point. And unlike hotel prices, which have risen 44% since Biden took office, and gasoline prices, which have increased 49%, the Bureau of Labor Statistics has found that prices for food for home use or grocery stores have risen 21.08%, roughly equivalent to the nearly 20% increase in the Consumer Price Index.

Harris may not want to revert to her own past flirtations with socialism, and stealing from Trump and Vance doesn't exactly inspire confidence in her intelligence. But if she borrows from the proto-communist experiments that caused the only inflation crisis worse than her own, then the implosion of the Biden economy would seem like a warm-up for the main event.