Driven by inflation, the prices of basic goods are spiraling out of control. The Fed’s solution of raising interest rates will hurt average workers. Rep. Jamaal Bowman is proposing a better solution: price controls.
This summer, Rep. Jamaal Bowman (D-NY) introduced the Emergency Price Stabilization Act to address inflation through targeted price controls and investment in production. (Drew Angerer / Getty Images)
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Brooklyn resident Jimmy McMillan made a crucial contribution to American politics with six simple words in 2010: “The rent is too damn high.” McMillan’s party — the aptly named Rent is Too Damn High Party — never won its mayoral or gubernatorial bids over a decade ago. But the phrase, which McMillan shouted from a bullhorn on many a New York City street corner, caught on, because the rent is, indeed, too damn high.
With inflation on the rise, the situation has grown damn more dire. According to Homes Guarantee, a campaign of People’s Action, rents rose over 14 percent year over year in June, compared to 2 to 3 percent increases before the pandemic. June 2022 saw the biggest one-month increase in rents since 1986.
You could adapt McMillan’s phrase for the rest of the basic goods. The groceries are too damn high. The gas is too damn high. The utilities are too damn high. That’s because working people are being slammed by inflation. According to a recent survey from LendingTree, “40% of Americans say they’re less able to afford their bills than a year ago,” and “62% of Americans struggle to afford at least one bill.” Over half of those surveyed overdrew their account to pay a bill, and a third have paid a bill late in the past six months. Not surprisingly, inflation — at a four-decade high — tops the list of concerns among people living in the United States.
“In my district and across the country, people simply cannot afford to live,” Congressman Jamaal Bowman (NY-16) said in a statement this summer. “From impossible rents and utility bills to soaring costs for food, health care, and other necessities of life, people in America are being crushed by the burden of high prices and wages that can’t keep pace.”
Bowman thinks the federal government should do something about it — something other than leave it to the Federal Reserve to employ its current anti-worker approach.
The Fed has been steadily raising interest rates all year with the aim of “slowing the economy down,” a euphemism for driving up the rate of unemployment, with an eye toward eventually lowering demand for goods and services. So this summer, Bowman introduced the Emergency Price Stabilization Act to address inflation through targeted price controls and investment in production.
These tools, he argues, are much more effective and equitable than the Federal Reserve’s modus operandi of fighting inflation “on the backs of everyday people” — particularly at a moment when landlords and corporations are taking advantage of an inflationary crisis to engage in price gouging.
“Business as usual is not delivering the basic things that everyone in a democracy should expect: a good job, a decent standard of living, financial security,” Representative Bowman told me over email:
That failure is by design. So we already needed to be talking about a new economic blueprint — and it’s especially important in a time of overlapping emergencies, when the ruling class is often able to exploit the situation to increase their profits.
Bowman’s bill would create a sub–task force to monitor and analyze price changes, investigate corporate profiteering and price gouging, and make actionable recommendations for regulating prices, which the bill grants the president temporary powers to implement. It also calls for public mobilization to aid in monitoring and regulating prices through websites, digital resources, and the establishment of volunteer networks.
The bill has nineteen cosponsors in the House of Representatives to date and a growing list of endorsing unions and grassroots organizations, including the AFL-CIO, the Service Employees International Union, International Brotherhood of Teamsters, National Nurses United, Food & Water Watch, Homes Guarantee Campaign, Working Families Party, and the Sunrise Movement. The dozens of endorsing unions and organizations provide a “powerful indication of the potential coalition we could have behind a price controls effort,” Rajiv Sicora, Representative Bowman’s senior policy adviser, told me.
“We’re living through extraordinary times,” Sicora explained. Yet in Washington, policymakers “still seem content to let the Federal Reserve do whatever it wants. There’s been very little critical discussion in Congress about the fact that we could have a much more fundamentally democratic response.”