Republicans continue to blame Democrats for the high rate of inflation, which has reportedly soared to 8.5% over the past year. Corporations have continuously blamed high prices on supply chain disruptions, the labor shortage, a rise in material and labor costs, and product shortages caused by strong consumer demand (all legitimate factors). As it turns out, however, there is also another factor that is driving high inflation: Wide-spread price gouging. How do we know? Despite all the challenges mentioned above, data from the U.S. Commerce Department shows that corporate profit margins are the largest they've been in the past 70 years. In addition, The Hill recently reported, "Overall, corporate profits after tax, as reported by the U.S. Bureau of Economic Analysis and compiled by the Federal Reserve Bank of St. Louis, hit $2.7 trillion in the fourth quarter of last year, just off the all-time high of $2.72 trillion in the previous quarter. That’s a 40 percent increase in profits from the pre-pandemic level of $1.96 trillion for the fourth quarter of 2019 and nearly an 80 percent increase from the pandemic low point of $1.5 trillion." - see link below.
The Democratic Party must, continuously and in unison, stress to voters that wide-spread corporate greed is contributing to high inflation. With corporate profit margins at historic highs, it's hard for anyone, including Republicans, to credibly deny the obvious price gouging. As long as corporations can price gouge and achieve historic profit margins at the expense of consumers, they will have no motivation to fix their supply chain issues or other problems. Food for thought: Government leaders intervene during natural disasters (hurricanes, floods) to protect the public from illegal price gouging. If corporate America continues down this path, Democrats should consider all our options to address the issue, to include raising corporate tax rates and using the proceeds to help struggling consumers.
For more information on this topic, please click on the links below:
UPDATE 7/30/22: Republicans want to blame President Biden and the Democratic Party for record gas/energy prices. In reality, corporate greed continues to be the biggest problem. As evidence, the largest oil companies recently reported record profits as they continue to gouge the American consumer - see media links below:
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