Price controls are never the answer.

Bad ideas never seem to die. I mean, how else do you end up with a US President who is obsessed with the long-discredited ideas of tariffs and a perfectly balanced current account, i.e. mercantilism?

Closer to home, certain Australians are starting to reach out for their own 'new ideas'. The ideas are in fact not new, but enough people appear to have lost the collective memory of why they're destined to fail that they might just gain political traction.

The first 'new idea' this week was in an article by Stephen Long published in The Saturday Paper, in which the ideas of German economist Isabella Weber and Jens van't Klooster were discussed. They're the people who coined the term 'shockflation' to describe the idea that inflationary surges are triggered not by demand but by supply shocks, which then propagate through profiteering and conflict.

It is, of course, nonsense. A supply shock can raise the price level. But the claim that prices then keep rising on their own steam due to profiteering, rather than through accommodative fiscal and monetary policy, is an idea that that the economics profession has spent decades arguing against.

But 'shockflation' is politically appealing because it allows politicians to divert blame from their own policy errors. It's also appealing to certain voters, because its proposed solutions – including "price caps when necessary and crack down on profiteering or price gouging" – suggest it's all about greedy businesses, not the consequences of the policy settings they voted for.

Perhaps the most ironic part of it all is that Weber just published a book called "Anti-Fascist Economics", despite the fact that Benito Mussolini, the founder of Fascism, imposed strong price controls on Italy to "maintain the purchasing power of those least able to buy, to protect the lira and to gain, if possible, an advantage in foreign trade by price manipulation".

Spoiler: it didn't work. Price caps only suppress the signal that tells people to conserve and substitute, and the incentive to bring new supply to market. The shortage doesn't magically disappear; it shows up as queues, empty shelves, quality cuts, and black markets.

The second 'new idea' this week came from Australia's very own Max Chandler-Mather, the former Greens member who now heads up something called the Green Institute. Chandler-Mather's bright idea is straight out of New York: he wants to nationalise 200 Coles and Woolworths supermarkets, which he claims will reduce the average cost of a shop by as much as 22%.

To make such a claim requires a level of innumeracy that I didn't think existed in Australia. Supermarket margins are relatively low (around 3%), so the only way to reduce average grocery prices by 22% would be to make a large loss. But Chandler-Mather thinks it'll be self-funding after just five years (provided you don't count the $25.1bn of taxpayer capital):

"A statutory authority would be established to set prices each month, as well as minimum wholesale rates for suppliers. Its members would include experts in supermarket operations, nutrition and food science, and farming.

The federal government would pay for capital costs including land, construction, and acquisition, and stores would be located in areas of the highest need."

To regulate prices he's proposing what is essentially a miniature version of the Soviet Union's State Committee on Prices, or Goskomtsen, which should give anyone pause. It's also riddled with "basic maths errors", but even if Chandler-Mather were being honest about the numbers, it would only 'work' by destroying the private sector. There's a reason why Mamdani's New York version has drawn a federal antitrust suit alleging a 'predatory pricing scheme'; competition is a hardy weed, but not if you pave over it with a state monopoly.

My biggest worry is that these bad ideas have already infected those at the top of Australia's political elite. For example, Treasurer Jim Chalmers penned a manifesto on "values-based capitalism", has a deep distrust of capital, and publicly endorses heterodox economists like Mariana Mazzucato. His stated aim is to "rebalance a system which is more generous to assets than it is to labour", and his government has already legislated against supermarket "excessive pricing". When prices next rise due to fiscal and monetary mistakes, he has an explanation ready, and Weber and Chandler-Mather will gladly supply the policy tools.

In a week during which many Australians have come face-to-face with a mild taste of price controls courtesy of the RBA's interchange cap, you would hope that there's some collective immunity to bad ideas such as those from Weber and Chandler-Mather. I wish I were more confident, but sometimes people need to relearn the lessons of the past the hard way before the immunity comes back.