And the best way to fight it without hurting workers or slowing the economy.
How much impact would it have if, and a gigantic if here, consumers in sufficient numbers just stopped buying for a little while? I mean the way we have been buying during this pandemic. If we found a way to lower demand on our part, that would have to have an impact, no? As I'm decluttering/downsizing/redecorating I'm pretty much only using Facebook Marketplace and other similar sites and giving and getting great deals from private citizens while totally bypassing both the corporate machine and putting my still usable things in the landfill. Not sure how to get enough people on board, what the messaging would look like or who would put forth that message, but this would work at least in part, would it not? And give some power over the economy to the people?
Sidebar: Why was it necessary for Biden to apologize for the language he used on an impertinent reporter that pales by comparison with the language his predecessor unapologetically used "liberally" on >anyone< who asked him a serious question - particularly with an impertinent FOX reporter? https://youtu.be/w7Zy5VajFqc
I agree, and why the hell aren’t you part of the biden administration ? You could do so much more from the inside….
A recent Facebook post put it succinctly: "It's not inflation when corporations are raking in their highest profit margins in history. It's price gouging." Along with: "Why is this so hard for some people to understand?" (And that includes educated people in the media and government.)
two quick points today. 1)my national news--NYT, WP, NPR, MSNBC all mention the role of large corporations in today's inflation. 2)more importantly, once more I turn at once to history and Paul Krug, one of the few contemporary economists I trust. Today's rate is hard to compare over time because definitions and data gathering have changed greatly. But in longer term perspectives, today's rate is not alarmingly high or unprecedented. It is also uneven from sector to sector.
On nat. news, read the news not the OpEds!
If the Dems could walk and talk, they'd explain this to the "nation" or "the public", shut down the Reps., and try to deal responsibly with inflation.
But then there are the Dems!
Push back with buying power. Buy local. Really local.
Push Rooseveltian ideas. Advocate for breaking up corporate power by breaking up corporate farms. The breadbasket of the US, the heartland, needs to be salvaged and revitalised, which would strengthen the entire country; it feeds the entire country. Extend Booker's Black Farmers legislation to extend opportunities across the country to young and youngish people to build small farms, small towns, small industries. #Big Little Farm. #Kiss the Ground
ELECT DEMOCRATS TO CONGRESS.
Professor, I certainly cannot add a word to your essay. However, there are some other factors that might be considered in the same context, particularly the role of the consumer and citizen. What can we do? It is just awful that so many have bought into the accusation that consumers are responsible for global warming, pollution, inflation and job losses. Corporations spend large amounts to try to assign the blame for problems onto individuals. The truth is that an individual, even by making the right choices, cannot much change the operations of global capitalism. Just one example, for brevity. Let's say you decide, based on the evidence, that eating beef is environmentally destructive. To be responsible, you avoid beef. However the beef industry is actively marketing around the globe to increase the number of people who hanker for and consume a "western diet". There are about 200 people around the world waiting to increase their consumption of beef and other environmentally costly foods for each westerner who might make other choices. This example attempts to show why I say we need government actions such as regulation and revised tax policy to rein in the excesses of global capitalism, which is less and less fettered under the 40 year trend towards neoliberalism. And the only way government can or will act to protect our interests is if we can achieve and maintain an effective Democratic majority in both houses of Congress. There you go... Unvarnished.
I agree with all except the bit at the end "Unless capitalism is made to work for everyone".
Capitalism was not designed for this. What you see before your eyes is Capitalism returning the results it was intended to create.
Still a fan?
And the New York Times recently published an editorial with the unhelpful headline "President Biden's Economy is failing the Big Mac Test." The substance of the editorial is more nuanced and fairer, but the headline effectively places the entire blame for inflation on Biden. The news media is not helping the situation.
I second the comment that you should be part of the Biden administration, assuming that they would listen to you more than Clinton's economic team did. In addition to what he's doing, Biden could repeatedly and vociferously call out the greedy corporations for their role in inflation. Many ordinary, intelligent people have bought into the notion that any increase in corporate expenses, whether it is taxes, wages, transportation, or materials, must always be passed on to the consumer in the form of higher prices. There should be pushback from the Biden administration that this is not the case.
With regard to the Fed, I read a comment that raising interest rates might not be successful in controlling inflation. If corporate greed is a major factor, maybe that comment is correct. I would like your thoughts on whether raising interest rates will actually bring down inflation.
Most people cannot/will not look at corporate financial figures to understand what is going on. So they will continue to repeat what is presented to them in the media. I can hardly go a day without putting my mantra out there. We will not change the minds of people unless they can get better sources of news.
It is very helpful for us to have a reliable source like you to point these things out. We have to address propaganda of Fox News and others.
The same thing happens when the Democrats put out great programs that will improve the lives of all citizens, but especially middle and lower classes. What do they scream? Businesses can’t afford it! Where will the money come from? But it would come from our taxes, the same source that puts trillions into the military!! How can people not get that connection! Faux News. Republican politicians.
Corporate America is going head on against Biden therefore the administration has nothing to lose in playing hardball just as Robert recommends. Profits taxed at a much higher rate also sounds good after reading todays newsletter. Dreaming I know!
It appears that Biden, and many Congressional Republicans as well, are in favor of restoring anti-trust controls that can break up octopus corporations that are inherently anti-competition (because they bought up their major and minor competitors) and restore something akin to a competitive 'free' market.
It's not as thought the octopus corporations pay their workers more as the companies gain more market share and increased income. What's really happening is that the people at the top are using the increased profits to increase their own wealth. Monopoly is not good for American wage-earners and it isn't good for the overall health of the economy. Action is needed to redress the excesses of our new gilded age.
Biden is doing too little too late in the fight vs. monopolies and oligopolies. After all, he’s been a Washington insider all his career. He was Vice President under Obama when the large financial institutions were “too big to fail.” We need the likes of Bernie Sanders and Elizabeth Warren to tell us the truth and effectively fight those sucking the blood from workers and consumers.
Corporations raise prices because they can do so now. They could not do so for the last ten years. Why the sudden change? On oil do we really want more production and lower prices? I thought we had a global warming problem. Isn’t this the reason why Biden’s first action in the Oval Office was to shut down the Keystone pipeline? People remember this.
Agree! We need our President and his cabinet to speak and act for our times, with firm grasp on facts put to the people in a vigorous way. Use great journalists also to root out wrongs, including greed. Reminds me of early 20th century with Teddy, doing the difficult things for breaking up trusts, monopolies like Standard Oil, railroads, meat packers, etc.
I would like to suggest some additional steps to reduce inflation:
1) Tax capital gains at the same rate as wages. It's the investor class that has increased demand due to their pandemic gains.
2) Tax corporations based on the income they report to their shareholders.
3) End deductions for the interest on loans that use equities as collateral - the billionaire tax dodge.