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People shopping in the egg and dairy case on March 13, 2020 at Whole Foods Merket in Vauxhall, New Jersey. (Photo: Rich Graessle/Icon Sportswire via Getty Images)
Debunking Four Myths About Inflation
Higher prices are not being driven by wage increases. They were not driven by federal assistance to people during the pandemic. And Democrats aren't to blame.
Jul 29, 2022
The truth about inflation is getting covered up by countless myths spewed by corporations and their political lackeys.
Here are the facts:
Fact #1: Inflation is not being driven by wage increases
Although wages have been rising, they've been rising more SLOWLY than prices. Hourly wages grew by 5 percent in the past year--but prices rose 8.6 percent. This means, when you adjust for inflation, workers actually got a 3.5 percent pay cut over the past year.
Fact #2: Corporate profits are one of the main drivers of inflation
Corporations are raising prices above what's needed to cover their higher costs. These mark-ups have soared. Corporations are getting away with this price gouging because they face little to no competition. And they're using the specter of inflation as a cover.
Last year, corporations raked in their highest profits in 70 years. One recent study found that over half the increase in prices we've been experiencing can be attributed to fatter corporate profits.
Fact #3: Federal assistance to people during the pandemic did not overheat the economy
Most families--who haven't had a real wage increase in years--used the assistance to pay down debt or save for the future. The assistance was barely enough to keep working families afloat.
Fact #4: Inflation is not the result of President Biden's or Democrats' policies
Republicans want to blame them for rising prices. But Democrats have tried advancing bills to bring down prices and address corporate price gouging, yet Republicans and a handful of corporate Democrats refuse to pass them.
So don't fall for the corporate myths about inflation.
Higher prices are not being driven by wage increases. They were not driven by federal assistance to people during the pandemic. And Democrats aren't to blame.
Inflation is being driven in large part by record corporate profits. The best way to fight it is to remove corporate incentives to raise prices through a windfall profits tax. And reduce monopoly power through tougher antitrust enforcement.
Know the truth.
Watch:
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This country and this world are at a monumental crossroads. US voters have an opportunity to beat back the forces of fascism and confront the billionaires who are rigging the economy, our media system, and our democracy, making it increasingly impossible for ordinary people to get by. We’re not just talking about the election. We’re talking about what must be done once these fascist elements are vanquished from power. We need a bolder set of solutions than what either major party has so far been willing to offer and a working-class movement ready to fight like hell for it. Trump didn't emerge from nowhere. The conditions that fueled MAGA authoritarianism were created by decades of radical neoliberal economic policies and a corrupt political system dominated by corporate interests. They slashed taxes on the super-rich, promising that the benefits would trickle down. They said giveaways to the corporate titans would make life more affordable for the rest of us. It was all bullshit. And when a bitter, betrayed populace searches for someone to blame, right-wing demagogues have little trouble finding scapegoats. People know when they're being lied to, but you won't hear any of this from the corporate media. Only independent journalism—powered and funded by people who believe in building a better world—can deliver truly trustworthy daily news. If you share our vision, please contribute whatever you can to sustain our work. |
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Robert Reich
Robert Reich is professor emeritus of public policy at Berkeley and former US secretary of labor. His latest book is the No. 1 New York Times best-seller, "Coming Up Short."
The truth about inflation is getting covered up by countless myths spewed by corporations and their political lackeys.
Here are the facts:
Fact #1: Inflation is not being driven by wage increases
Although wages have been rising, they've been rising more SLOWLY than prices. Hourly wages grew by 5 percent in the past year--but prices rose 8.6 percent. This means, when you adjust for inflation, workers actually got a 3.5 percent pay cut over the past year.
Fact #2: Corporate profits are one of the main drivers of inflation
Corporations are raising prices above what's needed to cover their higher costs. These mark-ups have soared. Corporations are getting away with this price gouging because they face little to no competition. And they're using the specter of inflation as a cover.
Last year, corporations raked in their highest profits in 70 years. One recent study found that over half the increase in prices we've been experiencing can be attributed to fatter corporate profits.
Fact #3: Federal assistance to people during the pandemic did not overheat the economy
Most families--who haven't had a real wage increase in years--used the assistance to pay down debt or save for the future. The assistance was barely enough to keep working families afloat.
Fact #4: Inflation is not the result of President Biden's or Democrats' policies
Republicans want to blame them for rising prices. But Democrats have tried advancing bills to bring down prices and address corporate price gouging, yet Republicans and a handful of corporate Democrats refuse to pass them.
So don't fall for the corporate myths about inflation.
Higher prices are not being driven by wage increases. They were not driven by federal assistance to people during the pandemic. And Democrats aren't to blame.
Inflation is being driven in large part by record corporate profits. The best way to fight it is to remove corporate incentives to raise prices through a windfall profits tax. And reduce monopoly power through tougher antitrust enforcement.
Know the truth.
Watch:
Robert Reich
Robert Reich is professor emeritus of public policy at Berkeley and former US secretary of labor. His latest book is the No. 1 New York Times best-seller, "Coming Up Short."
The truth about inflation is getting covered up by countless myths spewed by corporations and their political lackeys.
Here are the facts:
Fact #1: Inflation is not being driven by wage increases
Although wages have been rising, they've been rising more SLOWLY than prices. Hourly wages grew by 5 percent in the past year--but prices rose 8.6 percent. This means, when you adjust for inflation, workers actually got a 3.5 percent pay cut over the past year.
Fact #2: Corporate profits are one of the main drivers of inflation
Corporations are raising prices above what's needed to cover their higher costs. These mark-ups have soared. Corporations are getting away with this price gouging because they face little to no competition. And they're using the specter of inflation as a cover.
Last year, corporations raked in their highest profits in 70 years. One recent study found that over half the increase in prices we've been experiencing can be attributed to fatter corporate profits.
Fact #3: Federal assistance to people during the pandemic did not overheat the economy
Most families--who haven't had a real wage increase in years--used the assistance to pay down debt or save for the future. The assistance was barely enough to keep working families afloat.
Fact #4: Inflation is not the result of President Biden's or Democrats' policies
Republicans want to blame them for rising prices. But Democrats have tried advancing bills to bring down prices and address corporate price gouging, yet Republicans and a handful of corporate Democrats refuse to pass them.
So don't fall for the corporate myths about inflation.
Higher prices are not being driven by wage increases. They were not driven by federal assistance to people during the pandemic. And Democrats aren't to blame.
Inflation is being driven in large part by record corporate profits. The best way to fight it is to remove corporate incentives to raise prices through a windfall profits tax. And reduce monopoly power through tougher antitrust enforcement.
Know the truth.
Watch:
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