The Grocer did it!

In her first policy speech Vice President Kamala Harris takes on "Big Grocery" by blaming grocers for inflation. Economists, and the press, aren't buying it.

NORTH CAROLINA — If you’re wondering why grocery prices are so high, just ask Kamala Harris. OK, you can’t ask her since she’s not taking or answering questions. You’ll just have to take her word for it. But during her first “policy speech” last Friday, which was more campaign rally than policy address, the former crime-bustin’ prosecutor from San Francisco revealed the real culprit for higher prices.

No, it wasn’t Colonel Mustard in the pantry, and it certainly wasn’t Mr. Biden, or Ms. Harris, in the White House. Nor was it the dumping of almost two trillion of federal aid dollars into an already recovering economy over the objections of many prominent economists (more on that later) and calling it the “American Rescue Plan.” Nope. It was, Harris said with a straight face, the Greedy Grocer at the Food Mart. Seems Mr. Whipple (if you were born in 80’s or later, google it) has been squeezing more than the Charmin.

Americans are unhappy with the economy—the survey firm Gallup reports that only 25% of voters rate it as “excellent” or “good”—and nervous about rising prices. That’s not good news for candidate Harris. So, despite a strong start, it made sense for her to speak to an issue that many think will be her campaign’s Achille’s Heel—the economy. “As president,” she told the crowd assembled in an airplane hangar in North Carolina, ”I will take on the high costs that matter most to most Americans, like the cost of food…I will work to pass the first-ever federal ban on price gouging on food.” Applause. Applause. Applause. Boo bad grocers. Boo, bad, bad, grocers.

Though that might make sense to Harris and the adoring crowd proudly displaying Harris-Walz signs, it doesn’t make much sense to economists, economic reporters, or the editorial boards at national news outlets, like the usually fawning Washington Post and New York Times, or the Wall Street Journal. Turns out, it’s Harris that doesn’t have a Clue.

In an scathing editorial, the Washington Post said her “speech” was “an opportunity to get specific with voters about how a Harris presidency would manage an economy that many feel is not working well for them. Unfortunately, instead of delivering a substantial plan, she squandered the moment on populist gimmicks.”

“Thankfully, this gambit by Ms. Harris,” continued the editorial, “has been met with almost instant skepticism, with many critics citing President Richard M. Nixon’s failed price controls from the 1970s. Whether the Harris proposal wins over voters remains to be seen, but if sound economic analysis still matters, it won’t.”

It was a certainty that Harris would have to try to deflect some, or all, of the criticism aimed at the Biden Administration’s economic policies, which have come to be known as “Bidenomics.” She is, after all, part of the administration, and up until at least a month ago, embraced them. “President Biden and I came into office with a plan to grow and strengthen America’s economy,” she said in a speech in August 2023, “that is called Bidenomics. That is called Bidenomics, and we are very proud of Bidenomics.” Oops. Oops. Oops.

But if Harris can’t attack, or distance herself from Bidenomics, what is she to do? The answer, at least her answer, was to find someone, or something, else to blame for inflation. Numerous public opinion polls show that consumers are most upset by rising food prices. Bingo! Greedy Grocers! The grocers did it! Turns out, however, there’s one small problem with that strategy. It’s not true.

Even the New York Times isn’t swallowing it. “Economists have cited a range of forces for pushing up prices in the recovery from the pandemic recession, including snarled supply chains, a sudden shift in consumer buying patterns, and the increased customer demand fueled by stimulus from the government and low rates from the Federal Reserve,” reports the Times Jim Tankersley and Jeanna Smialek. “Most economists say those forces are far more responsible than corporate behavior for the rise in prices in that period.”

The Wall Street Journal put it more bluntly. “There is also no evidence that supermarkets or other food retailers are gouging anyone. Food prices are higher than they were before the Biden Presidency, but that is because of inflation. Retail grocery prices have risen roughly in tandem with wholesale prices. Supermarkets also have narrow margins on sales—roughly 2%, compared to 8% on average for other businesses.”

Oops again.

Fixing prices won’t fix anything

Jason Furman, a Harvard economist and former Obama administration official, told the New York Times that that policies meant to curb corporate price gouging could instead keep the economy from adjusting—limiting supply and spurring even higher prices. “This is not sensible policy, and I think the biggest hope is that it ends up being a lot of rhetoric and no reality,” he said. “There’s no upside here, and there is some downside.”

Again, the Wall Street Journal put it more bluntly. “If Ms. Harris really believes in this price-fixing, she lacks the most basic understanding of economics. If she is merely floating it to be able to get ‘price gouging’ into a speech, her cynicism is also telling.”

Harris didn’t, of course, go into any detail about how her plan to cut food prices would work, other than to blame those evil, greedy, price gouging, grocers. In what has become a troubling trend—borrowed from her boss, the President—she again refused to meet with reporters or answer questions from the press. So, no one, possibly even Harris herself, knows what she means.

Now a month into her candidacy, she is still avoiding engaging voters, and the press, with anything other than trivialities, cliches, slogans, and sound bites. The New York Times captured her campaign, so far, in a headline that reads, “Harris’s Early Campaign: Heavy on Buzz, Light on Policy,” and accused her of “cherry-picking the most popular parts of his [Biden’s] agenda and betting that a younger messenger can sell them to Americans.” What’s that saying about a silk purse and a sow’s ear?

Harris is going to find it tough going to disavow her role in Bidenomics. She was, after all, the tie-breaking vote, as President of the Senate, for the “American Rescue Plan,” which borrowed $1.9 trillion (yes, trillion) and doled it out in stimulus payments, even after there were already signs that the economy was on its way to recovery.

Lawrence Summers, the former President of Harvard and economic advisor in the Obama administration, warned at the time that it would pump too much demand into the economy too fast and risk overheating—spurring inflation. It was, he said, the “least responsible” economic policy in 40 years. Oops, yet again. Clean up on Aisle 5!

So rather than eat Bidenomics, Harris would rather blame grocers. Not so fast Vice President Harris. You break it, you own it. Though if Friday’s speech is any indication, she might want to change her campaign song from Beyonce’s “Freedom,” to Del Shannon’s “My Little Runaway.”

I’ll let the editors of the Washington Post have the last words. “Even adjusted for the pandering standards of campaign economics, however, Ms. Harris’s speech Friday ranks as a disappointment.”