Price Controls and the American College of Physicians - Essay Example

The American College of Physicians wanted to limit doctor's fees and hospital rates. The opinion of the College of Physicians was based on the fact that it would be better to self-impose limits instead of letting the insurance companies determine the income the industry would generate.

In 1989 Argentina impose price controls on all goods and services in an attempt to stop the rampant inflationary forces. The government called the new system "managed prices" and to raise prices businesses had to ask permission from the government to do so. Before the new rules, the price of food items had tripled in the previous weeks. In 1992 China eliminated price controls on food items in a rational move towards moving its economic system to assimilate more of a free economy. It eliminated price controls on meats, eggs, and grain. The move hurt the civilian population as the price of meat which was undervalued went up 40% instantly after the government eliminated price controls on food items.

At the beginning of the 21st century, the Irish government considered imposing price controls on rents and housing prices due to high inflation in this economic sector.
In 2001 California and Nevada impose price controls on wholesale electricity prices. The move caused some generators to withhold supplies, which created power shortages that caused stage 2 alerts. The Bush administration through this initiative capped excess profits on energy producers. Price controls are a common practice in the petroleum industry. In 1988 the U.S. government charged the Texaco Corporation with a penalty of $1.25 billion for violations of price ceilings on the sale of wholesale crude oil. Price control regulations have not been effective at maintaining the price of gasoline down in the 21st century.

In 1999 the state legislature of the State of Maine was considering either imposing a price ceiling on prescription drugs or realizing mass purchases to lower the price of medicine for poor people. One of the worst cases of hyperinflation the world has ever seen is the situation in Zimbabwe. The government of Zimbabwe has tried many strategies to stop the massive inflation, but nothing has worked. The use of a price ceiling is not a practice that the business community supports, but it is sometimes necessary to ensure the well-being of the civilian community. Critical items such as food, medicine, and gasoline have to be regulated by the government to a certain extent because these items are necessities needed to survive. Read More