August 19 :
State regulations and legislation introduced by Senator Kamala Harris's colleagues offer prospective avenues for a reduction in exorbitant rates, which Vice President Kamala Harris is highlighting in her presidential campaign.Laws against price gouging restrict profiteering in times of crisis, but their applicability varies greatly, according to Lindsay Owens of the anti-monopoly research tank Groundwork Collaborative. A statute prohibiting price gouging exists in the statute books of thirty-four states.
"States have been able to use these laws really effectively to prevent companies from exploiting crises to profit," said Owens. By enacting "the first-ever federal ban on price gouging on food and groceries," Harris hopes to put an end to the practice of large firms unfairly taking advantage of their customers in order to increase their own bottom lines.
During an abnormal market disruption, corporations are prohibited from boosting prices on consumer staples unduly, according to New York law, which Owens considers to be one of the strongest. Walgreens, a drugstore chain, reached a settlement with the state last year on claims that it artificially increased the price of infant formula in 2022, following a recall that caused a statewide shortage.
During the scarcity caused by a recall at major formula supplier Abbott Labs, Democratic New York Attorney General Letitia James accused Walgreens of increasing formula pricing by 10 percent after accounting for additional costs—and in one case, 70 percent. To avoid profiteering during times of war or other national emergencies, the sole federal legislation that prohibits price gouging was enacted. Lacking a definition, the law forbids the accumulation of certain rare goods with the intention of reselling them at a price higher than the current market rate.
While Harris was a senator in the United States, she co-sponsored a bill in 2020 that would have made it illegal to charge more than 10% more than the normal price during an emergency. Sellers who could prove that price increases were due to their own growing costs would have a legal defense under the new law.
Harris cautioned companies against breaking California's anti-price gouging law while she was the AG of the state, and the idea was based on that law. Rob Bonta, who is currently the attorney general of the state, used it to sue a landlord during the COVID-19 outbreak for rent increases. Although the supply issues caused by the epidemic have been resolved, consumer groups and certain Democratic lawmakers have claimed that corporations are trying to increase their profits by raising prices, citing the virus and inflation as justifications.
Some Democratic senators from the United States, like Massachusetts's Elizabeth Warren, have filed a bill that would criminalize the sale of goods and services at what the Federal Trade Commission would call a "grossly excessive price" earlier this year.
According to one criterion, the price must be 20% greater than the average market price of the preceding six months. Additionally, after a crisis or other unexpected market disturbance, publicly listed companies would have to reveal their pricing strategy and gross margins.
There were no Republican sponsors for the bill, but there has been bipartisan support for other pricing proposals, such the one that will change medication prices. Senator Chuck Grassley (R-Iowa) has spearheaded these measures and co-sponsored others to counteract the consequences of meatpacking industry concentration, a topic that Harris is anticipated to emphasize during her address.
A possible Harris government already has some powers at its disposal, even without new federal legislation. Under the Biden administration, the Federal Trade Commission utilized its existing jurisdiction to initiate a study of supermarket costs and to suit to urge a judge to prevent Kroger's $24.6 billion proposal to acquire Albertsons, a rival grocery chain.
