Falsely blaming Biden for inflation raises questions about trusting Republicans to run the economy
If you compare what Republicans are saying about Biden and the Democrats being to blame for inflation and size it up against the facts, you can understandably wonder whether Republicans can be trusted to run the economy.
Their policies and actions over decades have led to a structural problem of excessive corporate power that companies are exploiting in this time of economic stress. As one big example, Republicans have a long history of opposition to government oversight of companies gobbling up their competitors. This has led to one industry segment after another being so controlled by a few companies that they can pretty much dictate prices with impunity.
Eighty-five percent of beef supply is controlled by just four companies, who have dramatically raised their prices to consumers, and their profits, while small farmers have seen virtually no increase in the price they get for the cattle. Only three companies control the entire US insulin market. It is no surprise that Americans pay 10 times more for that much-needed drug than folks living in all other economically developed countries. The same story is being played out in the oil industry where, again, big oil is seeing all-time record profits. And the list goes on.
Republicans have argued that the government should not regulate acquisitions because they improved efficiency, which translated into lower consumer prices. Would be nice if it were true – but in fact in most cases prices go up for consumers following acquisitions. But that has not stopped Republicans from preaching that government regulations get in the way of business. Sure does – for large corporations that can use their financial clout, but not for small businesses and folks living off a paycheck, who get hurt.
Well, that whole dynamic got exploited even more when consumer demand bounced back after the pandemic. Companies had cut way back on production and inventories during the shut downs, and were slow to build back up, partly because their supply lines were affected, but also because, with little competition, they could still raise prices to grow their profitability, without using their financial resources to bring production back up.
To make matters worse, a handful of companies control the world’s shipping industry. They have raised their prices and seen their profits jump 5 to 10-fold as the covid pandemic has given way to rapid growth in demand around the world. President Biden has sought to address that but Republicans are sitting on their hands.
Now there are a lot of other factors causing inflation, like global energy sanctions in response to Russia’s lawless attack on Ukraine, severe drought conditions around the world affecting agricultural output, Russian blockages of grain shipments from Ukrainian ports, and so on. But profiteering based on monopolistic corporate pricing is a far more significant factor. Republicans are at the root cause of it, but won’t admit it.
But this is a pattern that repeats itself in history. Republicans do everything they can to take the side of big business and unchecked corporate greed, arguing that it is good for the economy. Fact is 48% of Americans do not own any stock and over 60% do not have 401k or IRA retirement accounts loaded up with company stocks. They don’t benefit from corporate success, so working families fall further behind.
Democrats take office and try to right the ship in favor of working families. Which is why the data shows that the U.S. economy does consistently better under Democratic administrations than under Republican ones. The economy works well when everyone participates, not when large companies and their shareholders get the lion’s share of income and profits. This is exactly where we are now – in spite of the covid- and corporate greed-fueled inflation.
Under Biden and the Democrats, employment and wages have bounced back, the deficit is being paid down, and rules are being put in place to make the economy more equitable for everyone.
