White House CEA Chair Bernstein talks VP Harris's econ plans

Vice President Kamala Harris has laid out some of her economic agenda, including a plan to crack down on what she says is price gouging by large food and grocery companies and proposals to stimulate the housing industry.

White House Council of Economic Advisers Chair Jared Bernstein sits down with Yahoo Finance Reporter Jennifer Schonberger to discuss VP Harris's policies and more.

In terms of her housing plans, Bernstein says: "If you listen to her plan, one of her concerns is investors buying up lots of single family homes, converting them to rentals and taking them off the single family market, leading to diminished supply there. I think her housing plan, which looks a lot like the one that President Biden has in our budget, is very much targeted at increasing the supply of the housing for the bottom half. I'd say affordable housing for moderate and low income folks."

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This post was written by Nicholas Jacobino

Video transcript

You mentioned grocery prices is the wind is about to take us down.

Vice President Kamala Harris formally accepted the nomination for president last night for the Democratic Party, and she's been floating some economic ideas among those a potential federal ceiling on grocery prices.

Would there be any price gouging now?

Of course, we don't have details.

We don't know what price gouging and how that's defined under her plan.

But would that solve the issue?

Generally, when we see price controls?

Does that not lead to shortages in higher prices?

Well, I think we should let her team give you the details.

What I will say is that she did not propose price caps.

She talked about taking action against price gouging in the way that any good prosecutor someone with her background should do, and ways in which any American who's concerned about costs should want from their president.

In fact, what she talked about explicitly was more competition.

You know, it made me think of this old, uh, Adam Smith quote where he says, Never do two.

I'm not quoting, exactly, but never do two business people come into contact.

Then they start to conspire to raise prices.

And what he said is the answer to that is more competition.

She's a prosecutor going after big corporate uh uh, actions that that create barriers to entry in key sectors where there's not enough competition to put downward pressure on price.

I think that's precisely the agenda you'd want your president to have in a climate like the one we've seen.

Let me ask you about housing as well she's put forth.

Vice President Harris has put forth a number of proposals.

When it comes to housing.

President Biden has looked at increasing housing supply by 2 million.

She's looking at 3 million.

She's talking about tax incentives for home builders.

But what about tax incentives for investors who bought up all those foreclosures following the financial crisis?

I mean, that's a lot of inventory that's sitting on the market right now, where you don't have to deal with local zoning to try to get that back out.

For Americans to buy homes again, why not consider a tax incentive for that for investors to get that inventory back on?

Well, actually, I mean, if you listen to her her plan, one of her concerns is investors buying up lots of single family homes, converting them to rentals and taking them off the single family market to diminish supply there.

I think her housing plan, which looks a lot like the one that President Biden has in our budget, is very much targeted at increasing the supply of housing.

For the bottom half, I'd say affordable housing for moderate and low income folks.

And it does involve subsidising not so much investors, but builders for a lot of builders in that sector.

Building low income housing, building moderate income housing doesn't pencil out.

They just can't afford to make the investments in the land the labour, the materials, but with some of the smart policies she talked about light tech for multi family housing and other subsidies for single family homes.

We think we can help make that pencil in instead of not pencil out.

All right, well, Chair Bernstein.

We'll have to leave the conversation there as the rain is coming down on us.

Thank you so much.

Thank you.

That's Jared Bernstein, chair of President Biden's National Economic Council of Advisers.