A customer selects Dannon yogurt from a dairy shelf at a Centreville, Virginia supermarket. A new Food & Water Watch report found that France-based Danone accounts for 80% of all U.S. yogurt sales. (Photo: Paul J. Richards/AFP via Getty Images)
One Way to Control Inflation? Enforce Price Controls on Corporations
Corporate monopolies are already controlling prices—to keep them high. It’s time to do something about it.
Though corporate America would like us to believe otherwise, the retail prices of essential goods like food and energy are not set by simple supply and demand.
That's why some experts now support a fix that was long considered taboo: limiting what corporations can charge for certain goods.
In large part, they're determined by the corporate cartels that have vanquished their competitors--and Wall Street speculators who place bets on the future availability of commodities.
With price hikes for energy, gas, and food remaining stubbornly high, it's time to do something about it. That's why some experts now support a fix that was long considered taboo: limiting what corporations can charge for certain goods.
In other words, price controls.
Price controls tend to outrage many economists and business-friendly politicians. But curbing excess profits and making essentials more affordable would be politically smart--and effective.
The public is clearly worried about high gasoline prices, and polls show that a majority think corporations are fleecing them. There's a good reason for that: While the pandemic certainly created logistical and supply chain headaches, it's equally true that corporate profits are soaring amid all the suffering.
That's no coincidence. Corporations that have near monopoly power in their sector understand that the pandemic has given them the perfect cover to profiteer.
In some sectors of the food industry--where just four companies control about 85 percent of the beef market and three companies dominate the chicken business--CEOs are telling shareholders that they raised prices above their additional costs simply because they could. Let's take them at their word.
Setting reasonable maximum prices for essentials like food, gasoline, and energy would reduce out of pocket costs to consumers--and therefore curb excessive profiteering by corporate giants.
We could start in the mega-consolidated food industries, where the meat and dairy giants exert considerable control over pricing. (Indeed, the companies that control the meat industries regularly face price-fixing accusations.)
Gasoline prices--always a hot-button political issue--are another area where setting maximum prices would deter fossil fuel industry profiteering.
There's historical precedent for such actions. Price controls were a key concern of the Roosevelt administration's Office of Price Administration during World War Two. Controls remained available in the decades that followed, either as a wartime measure or to properly align wages and worker productivity.
Even President Nixon instituted short-term controls on prices and wages in response to an inflation spike. It wasn't until the Reagan administration that lobbying by corporate interests eventually succeeded in eliminating these constraints on their power.
We've all been taught that prices are determined by supply and demand. But that really only applies in theoretical, competitive marketplaces. Rampant corporate concentration upends those assumptions in many parts of the economy, granting the dominant players the ability to keep prices high--to the delight of Wall Street investors.
In short, we already have price controls--they're just being set by corporate powers to keep prices higher.
The federal government has a range of powers it could use to protect consumers, public safety, and the climate. Unfortunately, the Biden administration is opting instead for short-term moves of dubious benefit--like releasing oil from the strategic reserves and waiving pollution rules to encourage more ethanol-blended fuels to hit the market before the summer.
The White House can and must do more.
In the short term, showing the political courage to confront corporate power and deliver tangible relief to families being squeezed by corporate greed will resonate with voters.
Over the long term, the answer is to pass legislation that breaks up corporate consolidation, like a bill recently introduced by Senator Elizabeth Warren and Rep. Mondaire Jones of New York that would block corporate mega-mergers that harm workers and consumers.
These are the kinds of steps we need to take to create an economy that works better for everyone.
Urgent. It's never been this bad.
Dear Common Dreams reader, It’s been nearly 30 years since I co-founded Common Dreams with my late wife, Lina Newhouser. We had the radical notion that journalism should serve the public good, not corporate profits. It was clear to us from the outset what it would take to build such a project. No paid advertisements. No corporate sponsors. No millionaire publisher telling us what to think or do. Many people said we wouldn't last a year, but we proved those doubters wrong. Together with a tremendous team of journalists and dedicated staff, we built an independent media outlet free from the constraints of profits and corporate control. Our mission from the outset was simple. To inform. To inspire. To ignite change for the common good. Building Common Dreams was not easy. Our survival was never guaranteed. When you take on the most powerful forces—Wall Street greed, fossil fuel industry destruction, Big Tech lobbyists, and uber-rich oligarchs who have spent billions upon billions rigging the economy and democracy in their favor—the only bulwark you have is supporters who believe in your work. But here’s the urgent message from me today. It’s never been this bad out there. And it’s never been this hard to keep us going. At the very moment Common Dreams is most needed and doing some of its best and most important work, the threats we face are intensifying. Right now, with just three days to go in our Spring Campaign, we're falling short of our make-or-break goal. When everyone does the little they can afford, we are strong. But if that support retreats or dries up, so do we. Can you make a gift right now to make sure Common Dreams not only survives but thrives? There is no backup plan or rainy day fund. There is only you. —Craig Brown, Co-founder |
Though corporate America would like us to believe otherwise, the retail prices of essential goods like food and energy are not set by simple supply and demand.
That's why some experts now support a fix that was long considered taboo: limiting what corporations can charge for certain goods.
In large part, they're determined by the corporate cartels that have vanquished their competitors--and Wall Street speculators who place bets on the future availability of commodities.
With price hikes for energy, gas, and food remaining stubbornly high, it's time to do something about it. That's why some experts now support a fix that was long considered taboo: limiting what corporations can charge for certain goods.
In other words, price controls.
Price controls tend to outrage many economists and business-friendly politicians. But curbing excess profits and making essentials more affordable would be politically smart--and effective.
The public is clearly worried about high gasoline prices, and polls show that a majority think corporations are fleecing them. There's a good reason for that: While the pandemic certainly created logistical and supply chain headaches, it's equally true that corporate profits are soaring amid all the suffering.
That's no coincidence. Corporations that have near monopoly power in their sector understand that the pandemic has given them the perfect cover to profiteer.
In some sectors of the food industry--where just four companies control about 85 percent of the beef market and three companies dominate the chicken business--CEOs are telling shareholders that they raised prices above their additional costs simply because they could. Let's take them at their word.
Setting reasonable maximum prices for essentials like food, gasoline, and energy would reduce out of pocket costs to consumers--and therefore curb excessive profiteering by corporate giants.
We could start in the mega-consolidated food industries, where the meat and dairy giants exert considerable control over pricing. (Indeed, the companies that control the meat industries regularly face price-fixing accusations.)
Gasoline prices--always a hot-button political issue--are another area where setting maximum prices would deter fossil fuel industry profiteering.
There's historical precedent for such actions. Price controls were a key concern of the Roosevelt administration's Office of Price Administration during World War Two. Controls remained available in the decades that followed, either as a wartime measure or to properly align wages and worker productivity.
Even President Nixon instituted short-term controls on prices and wages in response to an inflation spike. It wasn't until the Reagan administration that lobbying by corporate interests eventually succeeded in eliminating these constraints on their power.
We've all been taught that prices are determined by supply and demand. But that really only applies in theoretical, competitive marketplaces. Rampant corporate concentration upends those assumptions in many parts of the economy, granting the dominant players the ability to keep prices high--to the delight of Wall Street investors.
In short, we already have price controls--they're just being set by corporate powers to keep prices higher.
The federal government has a range of powers it could use to protect consumers, public safety, and the climate. Unfortunately, the Biden administration is opting instead for short-term moves of dubious benefit--like releasing oil from the strategic reserves and waiving pollution rules to encourage more ethanol-blended fuels to hit the market before the summer.
The White House can and must do more.
In the short term, showing the political courage to confront corporate power and deliver tangible relief to families being squeezed by corporate greed will resonate with voters.
Over the long term, the answer is to pass legislation that breaks up corporate consolidation, like a bill recently introduced by Senator Elizabeth Warren and Rep. Mondaire Jones of New York that would block corporate mega-mergers that harm workers and consumers.
These are the kinds of steps we need to take to create an economy that works better for everyone.
Though corporate America would like us to believe otherwise, the retail prices of essential goods like food and energy are not set by simple supply and demand.
That's why some experts now support a fix that was long considered taboo: limiting what corporations can charge for certain goods.
In large part, they're determined by the corporate cartels that have vanquished their competitors--and Wall Street speculators who place bets on the future availability of commodities.
With price hikes for energy, gas, and food remaining stubbornly high, it's time to do something about it. That's why some experts now support a fix that was long considered taboo: limiting what corporations can charge for certain goods.
In other words, price controls.
Price controls tend to outrage many economists and business-friendly politicians. But curbing excess profits and making essentials more affordable would be politically smart--and effective.
The public is clearly worried about high gasoline prices, and polls show that a majority think corporations are fleecing them. There's a good reason for that: While the pandemic certainly created logistical and supply chain headaches, it's equally true that corporate profits are soaring amid all the suffering.
That's no coincidence. Corporations that have near monopoly power in their sector understand that the pandemic has given them the perfect cover to profiteer.
In some sectors of the food industry--where just four companies control about 85 percent of the beef market and three companies dominate the chicken business--CEOs are telling shareholders that they raised prices above their additional costs simply because they could. Let's take them at their word.
Setting reasonable maximum prices for essentials like food, gasoline, and energy would reduce out of pocket costs to consumers--and therefore curb excessive profiteering by corporate giants.
We could start in the mega-consolidated food industries, where the meat and dairy giants exert considerable control over pricing. (Indeed, the companies that control the meat industries regularly face price-fixing accusations.)
Gasoline prices--always a hot-button political issue--are another area where setting maximum prices would deter fossil fuel industry profiteering.
There's historical precedent for such actions. Price controls were a key concern of the Roosevelt administration's Office of Price Administration during World War Two. Controls remained available in the decades that followed, either as a wartime measure or to properly align wages and worker productivity.
Even President Nixon instituted short-term controls on prices and wages in response to an inflation spike. It wasn't until the Reagan administration that lobbying by corporate interests eventually succeeded in eliminating these constraints on their power.
We've all been taught that prices are determined by supply and demand. But that really only applies in theoretical, competitive marketplaces. Rampant corporate concentration upends those assumptions in many parts of the economy, granting the dominant players the ability to keep prices high--to the delight of Wall Street investors.
In short, we already have price controls--they're just being set by corporate powers to keep prices higher.
The federal government has a range of powers it could use to protect consumers, public safety, and the climate. Unfortunately, the Biden administration is opting instead for short-term moves of dubious benefit--like releasing oil from the strategic reserves and waiving pollution rules to encourage more ethanol-blended fuels to hit the market before the summer.
The White House can and must do more.
In the short term, showing the political courage to confront corporate power and deliver tangible relief to families being squeezed by corporate greed will resonate with voters.
Over the long term, the answer is to pass legislation that breaks up corporate consolidation, like a bill recently introduced by Senator Elizabeth Warren and Rep. Mondaire Jones of New York that would block corporate mega-mergers that harm workers and consumers.
These are the kinds of steps we need to take to create an economy that works better for everyone.