Jason Furman, a former economic counselor to the Obama administration, has criticized Democrats for their efforts to pass anti-price gouging legislation in Congress. According to Furman, these kinds of policies will not do anything to cut down inflation and may even cause shortages of some goods.
During his appearance on the Sunday edition of “Face the Nation” on CBS, Furman discussed the question of whether or not the Democrats’ demand for a limit on price gouging will have any effect on consumers in the face of rising inflation.
Furman is quoted as saying, “I think it is pretty gimmicky, these price gouging bills, because you know, you’ve got a lot of extra demand.” “What happens when demand goes up? Prices go up.”
According to a recent study by Moody’s Analytics, the price of goods and services in the United States has increased by an average of $311 a month due to inflation. The increasing costs of commodities that are used on a daily basis, such as automobiles, housing, food, fuel, and medical care, are the root cause of the financial strain that people are experiencing.
According to Furman, “There is an old saying, the cure for high prices is high prices.” “That’s a little bit of a painful thing to deal with, but it is what elicits the additional supply, it brings more producers into the market, and it is what brings prices down.”
The economist’s next line of thought was, “We need to let that process work”. “You try to interfere, you will make things worse. We tried that in the seventies, it was a big failure. We shouldn’t be repeating it again.”
The Department of Labor announced last week that inflation picked up its pace once more in the month of April, with the consumer price index showing an increase of 8.3 percent. Although this is a touch lower than the 41-year peak that was reached in March, it was still far higher than what economists anticipated it would be.
According to Furman, the American Rescue Plan that President Biden enacted has been a contributing factor in the United States’ “incredibly high inflation,” despite the fact that it has helped the United States economy recover quicker than any other economy.
After Biden’s proposal was finally passed into law in March of 2021, Furman pointed the finger of blame at the Federal Reserve, saying that they were responsible for “a bunch of mistakes.”
Furman commented, “[The Fed] was behind the curve for most of last year”. “It kept thinking the inflation was transitory, it kept not moving to normalize rates, and now you add on top of that President Putin’s invasion of Ukraine, and that’s like the cherry on top of this terrible concoction we already had.”
The preceding is a summary of an article that originally appeared on Fox News.