Socialists must have goldfish-like memories.
Every few years they dust off the same worn-out ideas, rewrap them in shiny new rhetoric, and insist that this time central planning will finally work.
What they call innovation is almost always a rerun — an old script with a new cast — and voters are asked to forget the disastrous endings that came before.
That pattern is now playing out again in New York City, where voters just elected socialist Zoran Mamdani. He campaigned on affordability but offered the same big-government playbook that has failed everywhere it’s been tried — including the notion that government-run grocery stores will somehow reduce costs for everyday families.
We've already seen exactly where that road leads, however, and it never leads to affordability.
The Soviet Union spent seven decades proving that when the state takes over food distribution, the result isn’t fairness — it’s chronic shortages, empty shelves, and black-market prices that punish the poor most of all.
Central planners simply cannot out-perform markets in figuring out what people need, when they need it, and how much of it to produce.
But this is not just a cautionary tale from a far-off authoritarian regime.
Until recently, Kansas City had been flirting with its own version of this experiment after activists pushed for a taxpayer-funded, city-operated grocery store.
It quickly sank into the same economic quicksand as its Soviet predecessors, hemorrhaging millions in taxpayer dollars until the entire project collapsed and shut down earlier this year.
This is only the latest in a long line of socialist failures and a reminder of what happens when government tries to middle in free markets. New York's recent embrace of the same thinking shows the lesson still hasn't sunk in.
And now, despite decades of failed experiments here and abroad, that very logic is creeping into Washington — with even some conservatives falling into the trap.
Recently, Republican Sen. Josh Hawley, R-Mo., — who I have lauded for his leadership on other issues — joined forces with Washington’s leading voice of socialism Sen. Bernie Sanders, I-Vt., to introduce legislation imposing price controls on credit card interest rates.
They claim it will help economically pressured Americans, but as former Trump adviser and economist Steven Moore has made clear in a newly-released report, it will only make things worse in the long run.
Price caps always fail for the same reason as other socialist policies; they ignore the basic math of supply and demand.
When government forces prices below what it actually costs to provide a product or service suppliers pull back and shortages emerge.
If Congress imposes a cap on credit card interest rates, the repercussions will be both predictable and severe — and they will fall hardest on the very people the legislation claims to help.
The most significant consequence is that Americans may simply lose access to credit altogether. If lenders can’t extend credit to borrowers at rates that correspond to the risks associated with lending to them, they will stop providing it altogether.
This situation will leave millions of Americans, who depend on credit cards for unforeseen expenses such as emergencies, vehicle repairs, medical costs, or temporary financial shortfalls, completely excluded from the credit system.
Setting a maximum interest rate does not reduce the risk posed by borrowers; rather, it discourages lenders from engaging with them.
Furthermore, if lenders are prevented from pricing credit according to risk, costs will simply be shifted to other parts of the business.
That means higher annual fees, steeper ATM charges, and the disappearance of free checking accounts.
These changes will fall heaviest on lower-and middle-income consumers and show that instituting rate caps doesn’t erase expenses — it merely forces them onto other customers.
We know this because it has happened before.
When Congress enacted the Durbin Amendment, which capped debit card interchange fees in 2010, Washington promised it would save consumers money at the checkout line. Instead, retailers pocketed the difference, banks lost billions in revenue, and consumers paid the price.
Free checking accounts plummeted from 65% percent of all bank accounts to less than 30% in just a few years.
The Durbin Amendment has become one of the clearest case studies in how misguided price controls distort markets and hurt the very people they claim to help.
A cap on credit card interest rates would repeat the same mistakes — only on a far larger scale, by affecting more than 100 million Americans who rely on credit cards to foot the bill for everyday expenses.
Caps on credit card interest rates, like government-run grocery stores, interfere with economic freedom.
The lesson, once again, is simple: every time the government tries to mandate fairness through price controls the result is fewer choices and more hardship.
Instead of recycling old socialistic failures — be that government run grocery stores or credit card rate caps — policymakers should focus on using the free market to expand economic opportunity for all Americans.
Travis Korson is the Director of Public Policy for Frontiers of Freedom, and is a political veteran of politics with years of experience in campaigns, communications, and public policy. He served the Bush White House and has also served the Heritage Foundation, Americans for Prosperity, and the Faith and Freedom Coalition. He is a graduate of the George Washington University. His specialties include global affairs with a focus on international economics. Read Travis Korson's Reports — More Here.
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