Socialist Argentina follows-up runaway inflation with price controls on groceries

Take a look at this article from the leftist Washington Post, which reports on how the socialists in Argentina have imposed price controls in order to minimize the impact of runaway inflation caused by money printing.

Excerpt:

Argentina announced a two-month price freeze on supermarket products Monday in an effort to stop spiraling inflation.

The price freeze applies to every product in all of the nation’s largest supermarkets — a group including Walmart, Carrefour, Coto, Jumbo, Disco and other large chains. The companies’ trade group, representing 70 percent of the Argentine supermarket sector, reached the accord with Commerce Secretary Guillermo Moreno, the government’s news agency Telam reported.

[...]Economist Soledad Perez Duhalde of the abeceb.com consulting firm predicted on Monday that the price freeze will have only a very short term effect, and noted that similar moves in Argentina had failed to control inflation. Consumers shouldn’t be surprised if the supermarkets are slow to restock their shelves and offer fewer products for sale, she added.

A more effective way to contain inflation would be to “reduce government spending, which is financing an expansion of the money supply, and to have a credible price index.”

Isn’t ironic that the United States is pursuing the exact same policy of printing money and overspending as Argentina has? Excerpt we are a little further along.

So what happens next in Argentina? Zero Hedge explains:

What consumers will certainly do is scramble into local stores to take advantage of artificially-controlled prices knowing very well they have two short months to stock up on perishable goods at today’s prices, before the country’s inflation comes soaring back, only this time many of the local stores will not be around as their profit margins implode and as owners, especially of foreign-based chains, make the prudent decision to get out of Dodge while the getting’s good and before the next steps, including such measures as nationalization, in the escalation into a full out hyperinflationary collapse, are taken by Argentina’s female ruler.

[...]So to summarize: first capital controls, then a currency crisis, then expectations of sovereign default, then a rise in military tensions, and finally – price controls, after which all out chaos usually follows.

Study this sequence well: it is coming to every “developed” country near you in the months and years ahead.

Just to be clear, price controls are a clear signal to suppliers to stop supplying, since they cannot make any money if prices are held low by government decree. Price controls lead to shortages, necessarily.  And that’s what’s in store for Argentina once the private sector food suppliers (and other companies) pull out of there when they can’t make a profit. There are other places they need to be.

Imagine if America elected a charismatic, incompetent fool to run our country like socialist dictators do in Argentina or Venezuela. Imagine if the mainstream media, with their non-quantitative degrees and lack of real-world experience, covered for his every blunder. Where would we be then?

Filed under: News, Argentina, Banana Republic, Credit Rating, Crisis, Cristina Kirchner, Currency Devaluation, Debt, Default, Deficit, Hugo Chavez, Inflation, Price Controls, Socialism, Venezuela

California: Obamacare exchanges will raise health insurance premiums up to 25%

The radically leftist Los Angeles Times reports on it. (H/T The Cato Institute)

Excerpt:

California’s health insurance exchange said more than 30 plans are expected to vie with one another for spots in the state-run marketplace opening next fall.

State officials, and those in other states, are eager to flex their purchasing power under the federal healthcare law by selecting only certain individual and small-business health plans for 19 different regions across California.

The exchange, branded Tuesday as Covered California, will negotiate with insurers for the best rates and will assist consumers and small businesses in choosing a plan by separating them into five categories based on cost and level of benefits.

[...]The ability of the exchange to lower healthcare costs remains unclear. Experts said average premiums could rise in the exchange because the Affordable Care Act requires improved benefits, but consumers’ out-of-pocket medical costs could decrease under those same changes.

California insurance officials have expressed concern about substantial rate hikes for some existing policyholders going into the exchange.

Under a new rating map approved by state lawmakers, the Department of lnsurance estimated that premiums for similar coverage could increase as much as 25% in West Los Angeles, 22% in the Sacramento area and nearly 13% in Orange County.

Do you want to pay higher medical insurance premiums? Can you afford it? We’ve already seen massive drops in average household incomes under this President.

According to Forbes magazine:

New income data from the Census Bureau reveal what a great job Barack Obama has done for the middle class as President. During his entire tenure in the oval office, median household income has declined by 7.3%.

In January, 2009, the month he entered office, median household income was $54,983. By June, 2012, it had spiraled down to $50,964. That’s a loss of $4,019 per family, the equivalent of losing a little less than one month’s income a year, every year. And on our current course that is only going to get worse not better…

[...]Three years into the Obama recovery, median family income had declined nearly 5% by June, 2012 as compared to June, 2009. That is nearly twice the decline of 2.6% that occurred during the recession from December, 2007 until June, 2009. As the Wall Street Journal summarized in its August 25-26 weekend edition, “For household income, in other words, the Obama recovery has been worse than the Bush recession.”

[...]Obama has failed the poor as well as the middle class. Last year, the Census Bureau reported more Americans in poverty than ever before in the more than 50 years that Census has been tracking poverty. Now The Huffington Post reports that the poverty rate is on track to rise to the highest level since 1965, before the War on Poverty began. A July 22 story by Hope Yen reports that when the new poverty rates are released in September, “even a 0.1 percentage point increase would put poverty at the highest level since 1965.”

Additionally, medical insurance premiums, which Obama promised to lower, are actually up.

From Investors Business Daily.

Excerpt:

During his first run for president, Barack Obama made one very specific promise to voters: He would cut health insurance premiums for families by $2,500, and do so in his first term.

But it turns out that family premiums have increased by more than $3,000 since Obama’s vow, according to the latest annual Kaiser Family Foundation employee health benefits survey.

Premiums for employer-provided family coverage rose $3,065 — 24% — from 2008 to 2012, the Kaiser survey found. Even if you start counting in 2009, premiums have climbed $2,370.

Why should we go forward with Obamacare, which requires the construction of these exchanges? Obama already broke his promise to cut health insurance premiums, and the full implementation of these exchanges would raise the premiums even higher. This is nothing but a ploy to justify the imposition of price controls on private health insurers so that they go out of business, and we are left with a fully government-controlled system. Then there will be no choice, no competition, waiting lists, a shortage of doctors and rationing of health care by un-elected bureaucrats. Do not give this man a second term.

Here are a few articles that I have been using lately to inform people about the problems with Obamacare:

• Heritage Foundation: Obamacare Raises Taxes on 3 Million Middle-Class Americans
• Cato Institute: ObamaCare’s Cost Could Top $6 Trillion in first 10 years
• Life News: Obamacare is pro-abortion and pro-government controlled rationing
• Heritage Foundation: The 3 Biggest Ways Obamacare Kills Jobs
• Investors Business Daily: Obama’s Broken Health-Premium Savings Promise
• Reason: Obamacare will lead to longer wait times and crowded emergency rooms
• Doctor Patient Medical Association: 83% of doctors contemplating quitting over Obamacare

It’s important to understand that people who oppose this law don’t oppose because we are just being contrary.  We have reasons.

Filed under: News, Barack Obama, Choice, Competition, Costs, Coverage, Democrat Party, Doctor Shortage, Doctors, Employee, Employer, Exchange, Health Insurance, Health-care, Inflation, Insurance, Medical Insurance, Obama, Obamacare, Premium, Price Controls, Prices, Ration, Rationing, Socialism

What economic policies do left-wing and right-wing economists agree on?

This article is from Harvard economist Greg Mankiw. (H/T Michael)

Excerpt:

Here is the list, together with the percentage of economists who agree:

1. A ceiling on rents reduces the quantity and quality of housing available. (93%)
2. Tariffs and import quotas usually reduce general economic welfare. (93%)
3. Flexible and floating exchange rates offer an effective international monetary arrangement. (90%)
4. Fiscal policy (e.g., tax cut and/or government expenditure increase) has a significant stimulative impact on a less than fully employed economy. (90%)
5. The United States should not restrict employers from outsourcing work to foreign countries. (90%)
6. The United States should eliminate agricultural subsidies. (85%)
7. Local and state governments should eliminate subsidies to professional sports franchises. (85%)
8. If the federal budget is to be balanced, it should be done over the business cycle rather than yearly. (85%)
9. The gap between Social Security funds and expenditures will become unsustainably large within the next fifty years if current policies remain unchanged. (85%)
10. Cash payments increase the welfare of recipients to a greater degree than do transfers-in-kind of equal cash value. (84%)
11. A large federal budget deficit has an adverse effect on the economy. (83%)
12. A minimum wage increases unemployment among young and unskilled workers. (79%)
13. The government should restructure the welfare system along the lines of a “negative income tax.” (79%)
14. Effluent taxes and marketable pollution permits represent a better approach to pollution control than imposition of pollution ceilings. (78%)

I wonder which political party believes in most or all of these positions?

Hmmmmn.

Filed under: News, Agree, Agreement, Balanced Budget, Bankrupt, Budget, Budget Deficit, Cap and Trade, Carbon Tax, Centrist, Conservative, Debt, Deficit, Economics, Economists, Economy, Employment, Entitlements, Exchange Rates, Farm Subsidies, Free Market, Free Trade, Greg Mankiw, Harvard University, Housing, Left, Liberal, Minimal Facts, Minimum Wage, National Debt, Negative Income Tax, Outsourcing, Pollution, Price Control, Price Controls, Price Fixing, Progressive, Regulation, Rent Control, Right, Social Security, Spectrum, Stimulus, Subsidies, Tariff, Tax Cuts, Taxes, Unemployment, Welfare

MUST-READ: How Obama reduces the supply of medical care

I had written about the so-called doc-fix before, which is the problem of doctors being underpaid by the government for things like Medicare and Medicaid when they provide services to patients. Obama chose not to “fix” these low reimbursements in his health care bill, in order to hide the true costs of socializing medicine. But he has a plan now to fix the problem of government-run medicine not reimbursing doctors adequately.

And it isn’t what you might think.

From Laura at Pursuing Holiness. (H/T ECM)

Excerpt:

Conservatives were outraged by the chicanery of separating physician payment increases from the health care reform (that’s three lies for the price of one) bill Congress recently rammed through.  The “doc fix” was separate legislation so that physician payments could be increased without adding to the total cost of the main bill, so that Democrats could dishonestly claim the bill reduced the deficit.  Now, however, we are seeing the real “doc fix.”

Some Idaho orthopedists grew weary of the low reimbursement rates the government gave them for caring for worker’s comp patients.  So they got together and agreed not to treat those patients anymore.  They hoped that their boycott would force the Idaho Industrial Commission to increase the fee schedule – their payments.  While they were at it, they decided to stop working with Blue Cross of Idaho – also a notorious underpayer – until a better deal could be negotiated.  Unions behave this way all the time, and it’s often very effective.

In a similar case in Colorado last February, the Federal Trade Commission stepped in and charged the doctors with price-fixing.

Those doctors lost, and if they want to continue to work as physicians, they will do so at the prices set by the government.

Now the Obama administration has stepped it up a notch. The FTC only deals with civil complaints. In order to deal with the Idaho orthopedists, Obama sent in Eric Holder and the Justice Department, which is at liberty to file criminal charges.  You see, those Idaho orthopedists collectively agreeing that they had enough and weren’t going to take it anymore, were actually engaged in two antitrust conspiracies.

Read the rest. This is another first class post by Laura, and a great find by ECM. (Laura also sides with me on women taking responsibility for their own actions, which is why men like her)

So, it sounds like the Obama administration is heading towards Canada’s system where the private practice of medicine is a criminal offense. Doctors will not be able to set prices for their services. A patient giving money directly to a doctor, without government approval of the price (price controls), will become illegal. That’s the way that socialists roll.They love to fix prices.

And do you know what happens when doctors make less money than government clerks but have to work 80 hour weeks? That’s right – you have a shortage of doctors! Just like in Canada! And do you know what happens when there is a shortage of doctors? That’s right – you pay for the privilege of dying on a waiting list. (Unless you want an abortion, IVF or a sex change, I guess – because that’s politically correct in Canada)

This is why there are waiting lists in every country that has tried socialized medicine. Fewer doctors means fewer claims to the government – rationing. It’s the real way that government cuts costs. Well, that and euthanasia. Once government starts to regulate the practice of medicine, and to fix prices, you choke off the supply. And then you have to start killing people to avoid bankrupting the system, without or without their consent.

Filed under: News, Business, Choice, Commerce, Competition, Costs, Deficit, Doc Fix, Doctor, Economics, Free Market, Health-care, Medicaid, Medicare, Obamacare, Patient, Price Control, Price Controls, Price Fixing, Shortage, Socialism, Supply and Demand

Supreme Court sides with Conservative Party against price-fixing monopoly

Prime Minister Stephen Harper

Story here from the Vancouver Sun. (H/T Andrew)

Excerpt:

The Canadian Wheat Board cannot spend money on advocacy to protect its monopoly, following a Supreme Court of Canada decision Thursday against hearing an appeal from the Winnipeg-based agency, which asserts that it has been silenced by the Conservative government.

Without giving reasons, the high court declined the appeal application to a Federal Court of Appeal ruling that sided with the federal government in its 2006 order from then-agriculture minister Chuck Strahl for the board to refrain from spending its money on lobbying.

[...]The federal Conservatives are seeking to end the board’s monopoly, which is controlled by farmers. The monopoly makes the agency one of the world’s biggest exporters of wheat and barley.

The board maintains that the monopoly ensures farmers receive the best prices for their grain, but the federal government, along with some farmers, say that they would be better off in a free market, selling their products on their own.

Conservatives are for a free market and competition, because we believe that it is the best way for consumers to get a low price and high quality. The proper role of government is to ensure that no organization or business enjoys monopoly status due to the government insulating them from competition. The Canadian Wheat Board is just one option, but farmers should have other choices to sell their product.

Capitalism is opposed to monopolies and it is the proper role of government to make sure that no government policy is set up to favor one corporation over any competitor. Let the farmers choose what is best for them. Choice and competition.

Filed under: News, Appeal, Business, Buyer, Canada, Canadian, Canadian Wheat Board, Capitalism, Choice, Choice and Competition, Competition, Conservative Party, Consumer, Economics, Farm, Farmer, Free Market, Markets, Monopoly, Politics, Price Controls, Prices, Producer, Seller, Shortage, Stephen Harper, Supreme Court, Wheat, Wheat Board