In yet another embarrassing showcase of how little the modern left understands supply, demand, and basic economic reality, the Berlin Green Party has proposed a price cap on ice cream.
This time, the target of their virtue-signaling crusade is the average frozen dessert stand, where Berlin’s eco-socialist politicians have decided are charging too much, as noted by Substack publication “Eugyppius.”
The plan? They want every ice cream shop in Berlin to offer at least one flavor for a rock-bottom per-scoop price of €0.50 ($0.54) but only for “children and young people from poorer families.”
At a time when energy prices in Germany are sky-high thanks to the same Green Party’s reckless push to shut down nuclear power, abandon cheap Russian gas, and throw the economy at the feet of a dysfunctional “energy transition,” ice cream, like nearly everything else, has become more expensive.
In Germany, household electricity prices are among the highest in the world. Germany ranks fifth globally in terms of electricity costs for consumers. The Green Party has insisted on using only ‘renewable’ energy for 80% of its electricity by 2030, and 100% by 2035. Greens have also refused to accept nuclear energy as an option, and have been shutting down Germany’s nuclear power plants.
24 U.S. states have followed the same disastrous anti-science policies and have set 100% renewable energy goals, including large states such as California, which set the political target of 100% from renewables by 2045, and even rust belt states like Michigan, which has set in law to have 100% of the state’s electricity generation from renewables by 2040.
These policies are political targets, and economists say, will lead to financial ruin and blackouts.
It also leads to higher ice cream costs. Germany currently has high ice cream costs.
And when costs go up, central planners panic because there’s no simple way to bring them down, so they resort to the coercive power of the state to set prices.
According to German media outlet BILD, a scoop of ice cream in Berlin now costs over €1.50 ($1.62) on average, and in some places as much as €2.90 ($3.13). In Munich and Hamburg, prices have reached €4 ($4.32) per scoop—more than most working families can justify for a few licks of frozen dairy. The national average is €1.81 ($1.96) per scoop.
That’s too much, cry the Berlin Greens. 64% of the public are angry about ice cream costs, so they want to find a policy to bring prices down.
Their solution: mandates and price controls.
Instead of looking in the mirror at their own failed energy policies, Green legislators Benedikt Lux, Tuba Bozkurt, and Marianne Burkert-Eulitz are demanding that ice cream shop owners eat the losses and offer “affordable scoops” to the city’s children, without any subsidy, compensation, or plan to cover the costs.
They’ve formally submitted their demands to DEHOGA, the German Hotel and Restaurant Association, right now calling on the private sector to “do their part” and ‘voluntarily’ cap prices. Of course, in practice, when the government or a powerful and aggressive politician asks a business for something, it is arguably never “voluntary.”
It’s a microcosm of the entire Green agenda: command economics by press release, where economic laws are treated as mere obstacles to be legislated away. Want something to cost less? Just tell businesses to charge less.
However the policy is likely to worsen the effect on prices. As a forced political subsidy to one flavor, designated for ‘poor kids’, will likely raise prices on other flavors in order to continue paying the subsidy. This is known as “price control distortion” and “cost-shifting behavior.”
Typically price ceilings result in shortages since supply falls and demand rises. This then causes reduced profitability for producers who then cut quality, quantity, or availability and convenience.
When producers can’t charge market rates due to government intervention, they often raise prices on other, non-regulated goods to make up for the lost margins, this is “cost shifting.”
The core policies driving price inflation are likely the country’s exploding cost of energy. But as long as the party line is to shutter nuclear plants, banning coal, blocking natural gas imports, and insisting on wind and solar that can’t meet base demand, energy prices are going to keep rising. These choices raised costs for every producer, transporter, and seller in the economy.
As well, the continued costs of the failed and lost war in the Ukraine continues to sap the German economy. Germany’s ongoing support of Ukraine has cost the country at least $48 billion in social and military aid since the Russian invasion in February 2022. Other estimates say that the war cost Germany $171 billion by the end of 2023.
Germany announced it’s going to build 1,000 tanks, spending even more tens of billions, as a way to try and intimidate Russia.
The militant left’s priorities in Germany while driving economic policy into the ground, supporting failed wars with billions, shutting down viable energy plants, is also prioritizing silencing conservatives who want to privately talk to one another on cruise ships.
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