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Price Controls or Electioneering?

This week we interviewed Craig Pirrong for his perspective on Russia’s decision to freeze food prices until after the elections. The new Economist is carrying an article on the news as well:

According to a recent poll, almost half of Russia’s population believes that food-price increases are the result of a conspiracy between producers and speculators, rather than any global trends. The punishment of supposedly unscrupulous businessmen who profit from people’s misfortunes will probably be the next step. But the price-fixing show is also an alarming symptom of the governing elite’s belief in its total administrative power. The Kremlin is so used to being in charge that it feels the best response to rising prices is to tell them to stand still, argues Andrei Illarionov, a former adviser and now a fierce critic of Mr Putin. But such mighty commands will do nothing to solve the structural problems of Russia’s economy, including the weakness of the farm sector and the banking system.