Kyle Sammin: Bob Casey’s ‘greedflation’ fable
Some time around 2021, American corporate executives discovered greed. Before that time, they kept prices low out of the goodness of their hearts, but three years ago — for mysterious reasons — they suddenly, en masse, decided to send prices through the roof.
At least that’s the story Sen. Bob Casey wants you to believe. It wasn’t the reckless deficit spending from the federal government, flooding the nation with cheap money while interest rates were already zero. No, it was that newfound greed by shadowy evil-doers that made your grocery bill go up and your wages fail to keep up.
To call it a fairy tale is generous: this is a conspiracy theory. And the reason for it, as Kurt Counchman and Ilana Blumsack of Americans for Prosperity demonstrate in a recent report, is to deflect the blame from the people who started this inflation (Casey and his fellow Democrats in Washington) and assign to someone – anyone – who can serve as a scapegoat for the nation’s ire.
When corporate profits make the share prices go up, Democrats point to it as evidence that the economy is good and Biden is a success. But when there’s inflation, they blame those same corporations and insist it has nothing to do with the President or his party.
Other than a few committed partisans, no one’s buying it.
Greed — or a desire to maximize profit, if you want to put it more kindly — is a part of any free economy. Firms sell goods and want to make money. There’s nothing wrong with that, nor is it new and unnatural. It’s the way every free economy has ever functioned.
But if this is the case, wouldn’t every price be constantly rising? Of course not, because keeping that “greed” in check is the countervailing desire by consumers not to pay more money for the same goods. Firms want to maximize profits, but the competition among firms that produce the same (or similar) goods means that if, say, the Acme increases their prices, shoppers will shift their business to ShopRite or Aldi or any number of other competitors. Nikes cost too much? People will buy Reeboks or New Balance.
This is basic economics and is well understood by anyone who buys or sells anything.
So if we all know this is true, how can simple greed explain the rise in prices across the economy since 2021? Are the firms all colluding to raise prices? There isn’t really any evidence of that and if there were, the finger would again point back to the current administration for not stopping such illegal action. Why would firms refrain from colluding with each other until 2021, especially when President Biden installed the most anti-monopoly FTC chair in decades, Lina Khan?
It’s a very strange time for corporations to start flouting the law, but in Casey’s telling, that’s exactly what they did.
A less biased observer might note that nothing about the desire for profits changed in 2021. What did change? The massive amount of money being pumped into the economy through deficit spending in Washington.
As Couchman and Blumsack show, corporate profits remain steady as a share of national GDP. But the money supply has gone through the roof.
Congress has been running deficits for years, but Covid stimulus spending sent that out of control. That was understandable while the pandemic was raging and the economy cratering. But as the virus faded and people got back to work, Biden and friends told us our economy was strong and healthy. But they kept dumping more and more money into it, far more than was needed. It wasn’t paid for with taxes or tariffs, only borrowing, so the amount of money floating around grew at an absurd rate.
There was a theory, for a while, before the pandemic, that a country like ours (one that borrows money in its own currency) had no limit on the amount of money it could produce without ill effects. Normal economists rejected this Modern Monetary Theory, but it was music to the ears of socialists who wanted European-style spending with American-style taxes.
So they did it and, oh, what happened? The normal economists were right. Give out a bunch of free money, and pretty soon you find out it isn’t free.
Casey and other Democrats (and a few Republicans, too) insisted on learning this the hard way, and now we all pay the price in everything we buy. Blaming it on unseen enemies is good fodder for conspiracy theories, but it won’t convince anyone else.
Kyle Sammin is the managing editor of Broad + Liberty
This biased Broad and Liberty writer fails to point out a few things:
1. He states that the pandemic stimulus packages caused inflation, but he doesn’t mention that 3 of the 4 stimulus packages were passed by the GOP and Trump. Biden and the Dems passed just one.
2. He doesn’t note the following three things that caused inflation:
a. Trump deported a million immigrant farm workers. That created a worked shortage in agriculture, which caused inflation in grocery stores.
b. Putin invaded Ukraine and implemented a grain export embargo, which caused inflation.
c. Trump’s tariffs caused inflation.
3. He also doesn’t point out that egg companies were fined millions recently for price gouging.
4. He doesn’t point out that salaries are up at about the same level as inflation.
5. He doesn’t point out that inflation is at the historical average the last two years.
Mike,
I hope these comments help you sleep better at night.
Republicans did pass spending bills to support businesses. Then, before the money had gone out and before they had seen what the effect was, democrats were pushing more and more dollars out the door.
Inflation is not increased costs due to food alone. Deporting illegal immigrants may have been effecting the farm industry, but, if memory serves, they weren’t raiding farms. It was people who were arrested for crimes and failed to show up for hearings.
Trumps tariffs didn’t seem to impact inflation when the Dems weren’t pushing money out under their dumbass monetary policy of “it doesn’t matter how much money we print” — to be clear, that was their policy. They admitted it was their policy. They only recently changed their policy, yet still are spending like crazy from the federal level and are blaming greedy corporations rather than their own spending.
While Republicans can certainly get slapped for their spending from a fiscally conservative lense, don’t try to act like Dems are NOT grossly to blame.
Democrats caused most of the inflation through excess spending. Just one bill they pushed through cost three TRILLION dollars! It was funded with newly printed dollars.
“Rapid increases in the quantity of money create inflation. Inflation is taxation without legislation. It is made or stopped by the central bank.”
The Trump administration printed too much money.
Then, the Biden Administration printed too much money.
Looking back, George W. Bush (printed too much money) seems like a brilliant orator and speechmaker compared to current Vice President Harris. God help us.
Never in the history of the United States’ republic have the FBI, CIA, DOJ, and Pentagon so vastly exceeded their constitutional and legal parameters or violated the careful guardrails between civilian and military. “I pledge allegiance to the Flag of the United States of America, and to the Republic for which it stands…” We have generals too shameless to resign and running around out of control. And the “deep state” is convinced they are correct to function as tyrants for our own good – big brother indeed!
It is all theater. We even had Hulk Hogan tearing off his shirt at the RNC after Trump was shot in the head. We have become Idiocracy, the 2006 American science fiction comedy film directed by Mike Judge.
This past Independence Day holiday I decided to check out the facts as cited by the U.S. Energy Information Administration on its official government website, https://www.eia.gov.
Regular Gasoline: Average price/gallon in the U.S.A.
June 2019 $2.72
June 2020 $2.08
June 2021 $3.06
June 2022 $4.93
June 2023 $3.57
June 2024 $3.46
Are you better off today than you were four years ago?
These statistics can be found on the U.S. Energy Information Administration website.
Speaking of the July 4th Holiday, here’s a five year comparison of the cost of your cookout – these stats are from an food industry site (Datasembly) that tracks prices for that segment of the economy:
Item Description 2024 2023 2022 2021 2020 2019
Ground Beef Chuck Burgers 1.33 lbs (4 ct) 8.45 7.32 6.98 7.68 5.62
Beef hot dogs, 16 ct 10.30 9.42 9.71 8.63 6.98 7.62
Hamburger buns 8 ct 3.22 3.22 2.89 3.29 2.56 2.59
Hot dog buns 8 ct 3.28 3.27 2.89 3.33 2.56 2.61
Baked beans, 16oz 2.38 2.29 2.28 1.79 1.75 1.71
Soda, 12 pack 9.18 8.12 6.77 5.53 5.34 5.17
Disposable plates, 7 inch 50 ct 4.97 4.39 3.34 3.74 2.48 2.76
Sweet relish, 12.7oz bottle 3.53 2.51 2.28 2.28
Tomato ketchup 20oz 3.87 3.82 2.91 2.61 2.54
Yellow mustard, 14 oz 2.12 2.12 2.59 2.21 1.96 1.97
Mayonnaise, 12oz 4.86 4.84 3.46 3.30 2.90 2.83
American Cheese – 24ct 5.64 5.44 5.47 6.39 4.80 4.90
Plastic cups, 30 ct 5.71 5.64 4.87 4.03 3.68 5.19
Thinking about sending out Christmas Cards? The price of postage is already up 17% since August 2021, early in the Biden Administration, and now USPS will be raising the price of a stamp by another 5 cents. This will amount to a 26% price increase in less than three years. Is this price gouging? Maybe Senator Casey should look into this instead of complaining about the size of a candy bar.
Not mentioned here is Biden / Harris’s energy policy which has inflated costs and empowers our foreign enemies by use of rare earth minerals that we don’t possess domestically. We enjoyed cheap energy costs when Trump was in office by using domestic production of fossil fuel. Russia / Ukraine is clearly a Biden Administration responsibility due to inept US leadership (as well as quid-pro-quo Hunter payback) and fueled by their willingness to feed the conflict and extortion with US taxpayer funds and debt, causing strained oil and grain supplies. Illegal iImmigration explosion Is clearly Biden / Harris’s fault, including taxpayer benefits to illegals paid out and strains on local budgets. The border was secure under Trump – wall or no wall. Supply line disruptions by Biden’s inept transportation department head have caused inflation also. Offshore supply tankers waiting inline for months to dock in CA and Biden coddling the dock and rail unions’ strikes. The Democrats own this mess. Blaming corporate greed is a typical liberal trait of taking no responsibility for their actions.