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Free Market Meltdown? Economists Fret Over Return to Price Controls

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posted on Mar, 16 2009 @ 09:07 PM

State officials across the country are proposing price controls to help fix the economy, riling economists who warn they can harm the economy and even destroy cities.

It isn't only the federal government that is trying to fix the economy. Across the country, from Vermont to Alaska, state and municipal governments are doing what they can to ease the burden for Americans who are increasingly out of work and unable to pay their bills. One controversial solution being considered is a move back to price controls. The New York Legislature and the San Francisco City Council are considering expanding rent controls. Some politicians in Vermont are trying to limit the price of milk. And in Alaska, a bill to cap oil prices is pending in the state legislature. Proponents say the government has an obligation to provide relief for consumers during these trying economic times. But many economists say controlling prices and rents has failed in the past, and it often has bad consequences. "Economists widely agree that price controls often lead to shortages. There are many examples throughout history, and we have seen more recent demonstrations of this principle of economics in Venezuela and Zimbabwe," said Dr. N. Gregory Mankiw, a Harvard University economics professor and former chairman of the Council of Economic Advisers under President George W. Bush. Dr. Edward Glaeser, a Harvard economics professor who researches the effects of rent control, said price controls have "a whole litany of problems that make them among the most foolish forms of economic populism known to man."

People have been warning that this would come...and here it is. Will they pass...who knows..

But i'm sure more of this is on the horizon.

More and more of what many have said is coming true....

[edit on 16-3-2009 by David9176]

posted on Mar, 16 2009 @ 09:19 PM
What we need are profit controls. Can't expect anyone to want to sell something at a loss, but you can limit how much they can make before considering it gouging. That is America's biggest problem, most people can't tell if they are getting a deal or not. In America it is buyer beware. You shouldn't have to worry about someone scalping you on the neccessities of life. Although everyone in business should be able to make a living in line with what they provide to society.

posted on Mar, 16 2009 @ 09:30 PM
reply to post by David9176

I warned people last year that electing Obama would be the equivalent of re-electing Jimmy "the disaster" Carter.

Here is a quiz. Which of these quotes are Jimmy Carter's and which ones are Obama's?

1) "Our economy is in turmoil and our families are struggling with rising costs and falling incomes; with lost jobs and lost homes and lost faith in the American Dream."
) "We've always had a faith that the days of our children would be better than our own. Our people are losing that faith, not only in government itself but in the ability as citizens to serve as the ultimate rulers and shapers of our democracy."

3) "In little more than two decades we've gone from a position of energy independence to one in which almost half the oil we use comes from foreign countries, at prices that are going through the roof."

4) "Back then, we imported about a third of our oil. Now, we import more than half."

5) "Will we allow ourselves to be held hostage to the whims of tyrants and dictators who control the world's oil wells?"

6) "Our excessive dependence on OPEC has already taken a tremendous toll on our economy and our people."

7) "These efforts will cost money, a lot of money, and that is why Congress must enact the windfall profits tax without delay. It will be money well spent. Unlike the billions of dollars that we ship to foreign countries to pay for foreign oil, these funds will be paid by Americans to Americans."

8) "I believe we should immediately give every working family in America a $1,000 energy rebate, and we should pay for it with part of the record profits that the oil companies are making right now."

9) "In just ten years, these steps will produce enough renewable energy to replace all the oil we import from the Middle East."

10) "I am tonight setting the further goal of cutting our dependence on foreign oil by one-half by the end of the next decade."

11) "Think about how World War II forced us to transform a peacetime economy still climbing out of Depression into an Arsenal of Democracy that could wage war across three continents."

12) "Just as a similar synthetic rubber corporation helped us win World War II, so will we mobilize American determination and ability to win the energy war."

13) "I'll also extend the Production Tax Credit for five years to encourage the production of renewable energy like wind power, solar power, and geothermal energy."

14) "I am asking for the most massive peacetime commitment of funds and resources in our nation's history to develop America's own alternative sources of fuel -- from coal, from oil shale, from plant products for gasohol, from unconventional gas, from the sun."

15) "Think about when the scientists and engineers told John F. Kennedy that they had no idea how to put a man on the moon, he told them they would find a way."

16) "We ourselves are the same Americans who put a man on the Moon."

17) "We will set a goal of making our new buildings 50 percent more efficient over the next four years."

For the answers, go to the link:

posted on Mar, 16 2009 @ 09:50 PM
reply to post by ProfEmeritus

What's most amazing is that he compares himself to FDR, Lincoln, and suddenly...McCain?!?!

He is a master of words. I've watched many of his speeches...he works like a robot with the teleprompter. The same mannerisms over and over again...turns left to read...then turns right to deceive.

Being comparable to Jimmy Carter is a dubious honor at best.

I don't know all that much about he was elected the year I was born....although what i do know is definitely not good.

posted on Mar, 16 2009 @ 10:00 PM
reply to post by David9176

Being comparable to Jimmy Carter is a dubious honor at best. I don't know all that much about he was elected the year I was born....although what i do know is definitely not good.

I lived through the Carter years. they were horrible. Trying to raise a family during those times was almost as tough as it is now. Inflation had reached 18%, and companies had instituted wage controls, as part of the "voluntary" request by Carter to impose them. Everyone was fearful of losing their jobs, just as now. There are so many correlations between Carter and Obama. Unfortunately, many of the people who voted for Obama had no idea of how bad things were under Carter, and how bad they would get under Obama-and it hasn't even been two months, yet!

Those who fail to learn from the mistakes of history are doomed to repeat it. Unfortunately, those of us who DID learn from the mistakes of the past are now being forced to relive them, by the people who didn't learn.

This entire mess could have been avoided, if people had put a stop to Barney Frank and Chris Dodd, and their pressure to force Freddie Mac and Fannie Mae to give mortgages to people who should not have had them.

[edit on 16-3-2009 by ProfEmeritus]

posted on Mar, 16 2009 @ 10:08 PM
reply to post by ProfEmeritus

Unfortunately...there are many other problems on the horizon that seem to pale in comparison in that era...although it certainly was tough as you said. Unemployment isn't as high yet as it was during Carter.

I was young i don't remember much...the first president i can recall remembering is Ronald Reagan...and that everyone in my family seemed to like him.

I'm seriously wondering how long it's going to take for it all to really escalate...i know it's going to...just don't know when.

Obama is a full blown liar and deceiver...looking back at old speeches from his presidential campaign and before...and even after....he flip flop, changes his stances, and flat out lies.

His support will continue to drop...this certainly can't last forever.

posted on Mar, 16 2009 @ 11:34 PM
lmao dan quayle im a hoosier and he gave us a bad rep were not all that dumb.

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