Originally published at The Freemen News-Letter. 

​Vice President Kamala Harris, the current Democratic presidential candidate, has proposed price controls for food and groceries—a destructive idea that should be rejected. However, the current administration has already imposed price controls harming Americans, particularly seniors, by controlling healthcare prices under the Inflation Reduction Act (IRA).

Initially promoted as a solution to rising healthcare costs, the IRA has become a financial albatross, especially for seniors. With a staggering price tag of over $1.2 trillion, the IRA was sold as a necessary measure to curb inflation and lower healthcare costs. It has only exacerbated the financial strain on the people it claimed to help, however.

One of the IRA's most glaring failures is its sweeping changes to Medicare’s drug benefits. These changes were intended to make the benefits more robust by eliminating beneficiary cost-sharing at a much lower out-of-pocket limit. Instead, this policy shift has inadvertently transferred significant financial risk onto health plans, leading to unintended consequences, the most notable being a sharp increase in premiums.

The IRA was supposed to save patients money by allowing Medicare officials to set drug prices. However, this provision primarily reduces government expenditure rather than lower costs at the pharmacy counter. This has resulted in immediate premium hikes, with the promise of savings deferred to years later—a classic bait-and-switch. Seniors are paying more now for future benefits that may never materialize.

This surge in premiums is directly linked to the government’s increased involvement in setting drug prices. By imposing de-facto price controls, the IRA has reduced the funding available for developing new treatments and has inserted more bureaucracy between doctors and patients. This interference disrupts the healthcare market's delicate balance, where supply and demand should dictate prices and innovation.

Moreover, the IRA’s impact extends beyond just premium hikes. Medicare beneficiaries are now facing the lowest level of plan choice ever, with many plans exiting the market. This reduction in options and higher costs leaves seniors with fewer and more expensive healthcare plans. The promise that the IRA would make healthcare more affordable rings hollow as seniors are forced to navigate a market with diminished competition and escalating costs.

These poor policy choices have contributed to Medicare Part D premiums increasing by 21% this year, with expectations of a 50% rise next year. This stark increase directly contradicts the IRA’s initial promises and places an undue financial burden on seniors who can least afford it. Furthermore, the number of available prescription drug plans has plummeted, with nearly 100 plans disappearing last year alone. Medicare Advantage recipients may face an additional $400 per year in costs, a harsh reality as inflation erodes the purchasing power of seniors and all Americans.

The consequences of these policies are not confined to the healthcare market. The IRA’s expansive scope and high costs are emblematic of government overreach that stifles economic freedom and burdens taxpayers. The act misallocates resources by funding unreliable green energy projects at taxpayers’ expense and imposing hefty new taxes on businesses, further straining the economy. The IRA’s Medicare policies are hitting seniors hard, despite the administration’s claims of lower costs.

A free-market approach offers a viable alternative to this heavy-handed government intervention. The healthcare system can become more innovative and affordable by reducing regulatory burdens, allowing market forces to set prices, and promoting competition. Policies should focus on removing obstacles for Medicare Advantage plans to negotiate better prices and increase the number of healthcare providers by eliminating unnecessary regulatory barriers like certificate-of-need laws.

Ultimately, the solution lies in embracing economic freedom and limiting government intervention in healthcare. History shows that government solutions often exacerbate the very problems they aim to solve. The IRA’s failures underscore the need for market-based policies that prioritize individual choice, innovation, and quality patient care over bureaucratic control. By doing so, we can ensure that seniors receive the care they need without the prohibitive costs imposed by misguided government policies.

Hurricane Harvey brought devastation of catastrophic proportion. Reports note more than 80 deaths and around $150 billion in economic destruction. As someone raised in South Houston and with family and friends directly affected, it’s heart wrenching to see such damage. 
 
Potentially adding to people’s pain was the possibility of scam contractors and price gouging. Scam contractors, also known as “storm chasers,” shouldn’t be allowed to prey on vulnerable people with fake promises of home repair or cheap cars.  
 
What about the concept of price gouging? Is there a price that takes advantage of people who need resources for their livelihood in the wake of natural disasters? Answers to these questions are often not clear cut, as determining that a price is gouging the consumer could harm those that need the good.
 
Defined statutorily in Texas as “selling or leasing fuel, food, medicine or another necessity at an exorbitant or excessive price,” price gouging laws may help control consumers’ costs, but they can also have the adverse effect of deterring an increase in supply.
 
Low price mandates may make items more affordable, but are useless if items aren’t available. Elevated prices, on the other hand, attract more supply, preventing long-term shortages and ultimately driving the price back down.
 
Additionally, price controls can lead to hoarding, resulting in even fewer people getting supplies, potentially setting up costly price gouging in the black market. Allowing prices to rise discourages hoarding of supplies and encourages more rationed use of goods.
 
To put it simply, higher prices send signals to suppliers of where and how much to supply and to consumers of how much to purchase. Without these signals, the devastation from natural disasters will likely be much worse.   
 
These principles could clearly be seen in the days following Hurricane Harvey. The storm shutdown roughly 25 percent of the nation’s refining capacity and transportation routes were blocked for days from flood waters. Fear of running out of gas naturally increased demand. Spooked consumers dashed to their nearest gas station to fill their tanks and other containers. 
 
Gas prices jumped in Houston from an average of $2.10 per gallon to $2.50 within days after the storm, according to gasbuddy.com. But there were reports of some stations charging as much as $20 per gallon, and many stations there and statewide had no gas. The average price remained near $2.50 per gallon for a while, as it tends to track gas futures prices that soared after the storm, and most stations soon had gas available.  
 
Gas markets work with higher prices sending signals to suppliers of where and how much to supply gas and to consumers of how much gas to purchase. Without these signals, the devastation from natural disasters will likely be much worse.   
 
What if stations can sufficiently raise gas prices? Consumers use that information to ration purchases of gas to just what’s necessary, instead of hoarding it in multiple gallon containers statewide. Other suppliers use this information to dedicate more gas to that area now that they can cover increased costs of transportation, labor, and risk, which has been the case as refineries come back online.
 
Frivolous allegations of price gouging laws at the time, with 127 retailers eventually receiving notices of alleged violations after the storm, could distort market prices and deter charity thereby hurting those most the law is trying to help. 
 
Let us be cautious about claiming negotiations of individuals in the marketplace are wrong so that Texans affected by this tragic event and statewide will have sufficient resources to recover and prosper now and in the future.