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The prices of everyday goods are going up, and everyone from members of Congress to talking heads on cable news have their own diagnoses as to why it’s happening. But they’re all missing the biggest piece of the puzzle about what is to blame—namely, corporate profiteering.

You’ve heard a dizzying array of explanations about inflation. Biden administration officials have said the Covid pandemic resulted in supply chain disruptions, which are now being ironed out. Republicans are blaming Biden’s policies for putting too much money into the hands of working families. Corporate leaders are blaming it on an inability to hire workers and a workforce that wants better pay and working conditions. Economists say that while inflation is indeed occurring, the expectation of inflation is truly what’s altering consumer attitudes and behavior.

What all these arguments miss is that, despite whatever rising costs exist for raw materials or transportation or other underlying factors, the incontestable truth is profits are way up for the largest corporations in America.

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And what that means is pretty simple: Corporate America has seized on the fears of inflation to jack up prices on you and make a ton more money. According to The Wall Street Journal, nearly two out of three of the biggest U.S. publicly traded companies had larger profit margins this year than they did in 2019, prior to the pandemic. Not just profits. Larger profits. Nearly 100 of these massive corporations report profits in 2021 that are 50 percent above profit margins from 2019.

CEOs are quick to suggest to media that they have been forced to raise prices because of one difficulty or another. However, my organization More Perfect Union reviewed recent corporate earnings calls featuring CEOs of some of the largest companies in the world, like Tyson Foods, Kellogg’s, Pepsi, Mondelez (a huge snack food and beverage company that used to be known as Kraft), and others. And we found jubilant executives revealing that price hikes are great for business.

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In these calls, business leaders employ fancy financial lingo to tell large shareholders how they are engaging in “pricing improvements” and “successful pricing strategies.” They tell you they are experiencing customer “elasticities” to price increases at historically low levels. When you decode what they’re saying, it’s nothing less than a euphoric articulation that they’re able to pass off price increases to consumers, who, in the words of legendary investor Warren Buffett, are “just accepting it.” The stocks have in turn moved higher and higher. (And interestingly, when a corporation like Target announces it hasn’t raised prices despite strong earnings, investors are punishing it by pushing the stock downward.)

In an interview with Fox Business, John Catsimatidis, a conservative pundit and billionaire CEO, revealed very simply what his C-suite colleagues are doing. “Why give something away if you don’t have to, and you can have a bigger margin?” he said. Right. It’s corporate price gouging at work.

Beef prices are up this holiday season. Why are they up? Because a consolidated market has allowed monopolists like Tyson’s, Cargill, and National Beef to rake in more profits while ensuring that very little of that goes to ranchers and farmers who are raising the cattle.

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Home Depot and Lowe’s recently posted incredible earnings, pleasing giddy investors. CNBC’s voluble Jim Cramer observed that these two companies “can do no wrong because they’re passing on rising costs to the public, and the public has no choice …because these two chains have single-handedly wiped out the competition already.”

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The power is entirely in the hands of large corporations, and they’re going for the gold. This story of corporate greed is being missed in the national inflation conversation.

But there’s more! Think about the devious design of what corporations have been up to. For months, they have, with one hand, fueled talk of inflation as a way to make obscene profits off the backs of consumers. That’s bad enough. But with the other hand, they have been manipulating the talk of inflation to engage in a full-frontal assault on President Biden’s efforts to pass a Build Back Better bill for working families.

The U.S. Chamber of Commerce has called Biden’s proposal an “existential threat,” and it—along with many corporate P.R. groups—has led a multimillion-dollar barrage of corporate ad spending to try to dissuade voters about it.

Corporate America is also feeding its talking points into the hands of Republican lawmakers and media outlets that pin the blame for inflation on Biden and falsely warn that enacting a working families bill is only going to feed it further. Because the Build Back Better act will have increased taxes on corporations, these big businesses are eager to kill it. They are not about to give up any of their record profits to invest in the safety net of America.

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As we head into Thanksgiving and Christmas, and we all look forward to large enjoyable feasts with friends and family, we should rightly harbor anger about inflation. Not just that they made us pay more for turkey, cranberries, and pie crusts. We’re having to pay more because corporate America made a choice to raise prices on us, and then on top of that, it tried to manipulate your fear about those prices to keep you from getting paid leave, home care, childcare, and climate change action. Corporate America made you pay more while trying to make sure it didn’t have to

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Corporatism yuck
It is this or fascism
Eat the rich now please

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Only gullible sheeple believe that.


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Gulible sheeple
Believe what they are spoon fed
Always not my fault

Gullible sheeple
Crying for a nanny state
They believe anything


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Most products are imported China is raising costs 30%

When cogs goes up, margin goes up and profit goes up. (Short term) Simple concept.


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Transcripts show the truth.
Can you refute the words shown?
Troll game way too old.

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Its an opinion piece on a radical left website. Its a dog whistle. There isnt anything to refute. Its a bunch of made up lies that scared libtards swallow easily.

Go get some real facts.


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Disprove the statements
Prove these words were never said
Just read the transcript

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Originally Posted by EveDawg
Its an opinion piece on a radical left website. Its a dog whistle. There isnt anything to refute. Its a bunch of made up lies that scared libtards swallow easily.

Go get some real facts.

This.


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Eve is SuperBrown
We can’t like our own posts now
Quote ourselves we must

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Control business
Control people
Become communists.

Read state media
Riot in streets
Be faithful zombies.


If everybody had like minds, we would never learn.

GM Strong




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Sad republican.
Trump made you all look like fools.
Still conning you all.

The left is better.
Morals and values still here.
The right has lost theirs.


Your feelings and opinions do not add up to facts.
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is there anything a republican can post that a democrat will believe?


is there anything a democrat can post that a republican will believe?


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Originally Posted by EveDawg
Its an opinion piece on a radical left website. Its a dog whistle. There isnt anything to refute. Its a bunch of made up lies that scared libtards swallow easily.

Go get some real facts.


Actually, I think since you are disputing these statements, it's up to you to find the things that disprove them

You can say crazy things like "the libtards did it" until the cows come home,, but that doesn't prove you are right.... So prove it

This is the part where you tell me that you don't have to prove anything. Waiting!


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So let's just take this article at face value and that everything it says is true...the Covid checks have made consumers more receptive of price increases that companies have taken advantage of by raising prices. (PS, the facts in the article are really weak)

So the Left's answer to that is to pump trillions of more $$$ into the economy and pray that the same things doesn't happen again?

Sorry, that doesn't make any sense.

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It's really hard to take anything in that article at face value when they jump to misleading conclusions like that. HD and Lowe's have been killing it because everyone was stuck at home with nothing to do so they were working on their houses. They're still killing it because of the housing boom. Lumber was an issue coming out of the worst of the pandemic, but has returned to near-normal pricing once the supply chain issues were mostly addressed that caused the price spike. Notice how that article can't/won't go into specifics like that.


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Even when you post specifics those who wish to believe otherwise refuse to address them. superbowldogg posted this....

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Most products are imported China is raising costs 30%

When cogs goes up, margin goes up and profit goes up. (Short term) Simple concept.

I've shown where the costs of shipping has also skyrocketed. The responses? Liberal libtard liberals. When the vast majority of responses are nothing but internet troll type posts, it's quite easy to see who doesn't want to issue all of the facts surrounding the situation.


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It's not unreasonable to say that rising shipping costs and prices from China cause prices at the store to be higher. However, those things (rising costs and prices) are by definition inflation, so they can't be the cause of inflation.

The article (written by a liberal and posted by a liberal, hence the liberal comments) tries to state that the root cause is basically corporate greed - it never mentions any of the other factors you mentioned.

I think the article is actually on the right track, and that US consumers are more willing to pay increased prices. However, I would argue that this is due to the stimulus bills that dumped trillions of artificial dollars into the economy and were not targeted enough to get the $$$ to the people that really needed it.

So, I think it's asinine to think that the answer to our current economic woes is to pass another bill to pump trillions of more dollars into the economy and think that it's going to fix the problems.

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Originally Posted by OrangeCrush
It's not unreasonable to say that rising shipping costs and prices from China cause prices at the store to be higher. However, those things (rising costs and prices) are by definition inflation, so they can't be the cause of inflation.

The article (written by a liberal and posted by a liberal, hence the liberal comments) tries to state that the root cause is basically corporate greed - it never mentions any of the other factors you mentioned.

I think the article is actually on the right track, and that US consumers are more willing to pay increased prices. However, I would argue that this is due to the stimulus bills that dumped trillions of artificial dollars into the economy and were not targeted enough to get the $$$ to the people that really needed it.

So, I think it's asinine to think that the answer to our current economic woes is to pass another bill to pump trillions of more dollars into the economy and think that it's going to fix the problems.

Liberal anti business policies used by the Biden Administration caused this issue. Just like Carter in the 1970's. Government needs to get out of the away and let smart business people do what smart business people do and that is make money. When government gets involved and places restrictions, regulations, and other anti business laws in place we all pay. trickle down economics works it either trickles down wealth for all those who participate or trickles down poverty in the form of inflation thru higher costs of everything.

Just look at big red states there is no middle class you are either rich or poor in California, New York, Massachusetts, Connecticut, etc... Open your eyes!!!


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I think we agree to the point that there isn't a single factor that is causing the inflation we're seeing. And yes when the cost of goods and shipping go up, they are contributing factors (causes) of inflation but not the only ones. I won't argue with you about the article because I'm not on board with it either. It's certainly slanted. It's not as if corporate greed is some new phenomenon. Even the term corporate greed is a term I find very flawed. The very concept of business is to succeed and make money. They aren't charities.

As far as the stimulus money, I agree that it wasn't targeted to the places that it would have best served our economy. Where we disagree is that this is why people accept paying more now. The checks came out months ago and most people needed that money. for most people that money is already gone and has no impact on what they may accept now in paying higher prices. The federal unemployment program dried up in early September so I don't think that plays into it either.

And to some extent I think you're right. I was certainly on board with the infrastructure bill because it serves every portion of our economy. From good paying jobs for the people to a shot in the arm for business. We also see a need to upgrade our infrastructure because it has been neglected for so long. I'm not nearly as opposed to spending money on things that will actually help increase the tax base which results in some of that money coming back.

As far as the build back better bill I'm rather torn. I see trillions of dollars being given in tax breaks to big business and everyone then complaining when you try to pass something no more expensive to help every day Americans. But with the current economy I can't say I promote this as being the time to do it.


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As for basic facts I'd like to see in rhe original article and that I would expect based on the assumptions the author has made:

When 2021 profits have been adjusted for the roughly 7-8% inflation of the last 2 years and then compared to 2019, what % of those companies has shown increased profits, and how does that compare to a normal 2 year period, especially when inflation isn't as high.

I would imagine that it is very similar to any other 2 year period, and that is why the author left that info out of the article.

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Since the vast majority of that inflation has happened this year, I think trying to dilute the equation by adding in last year wouldn't be a gauge of anything. If you compared only last year when inflation was still low to previous comparable years I think it would be a much better gauge when comparing to previous years.


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What empirical information is any of that based on?


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He means like back before they had child labor laws, safety standards and anything that protected people and let business run amuck. You know, the MAGA days.


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Originally Posted by PitDAWG
Even when you post specifics those who wish to believe otherwise refuse to address them. superbowldogg posted this....

Quote
Most products are imported China is raising costs 30%

When cogs goes up, margin goes up and profit goes up. (Short term) Simple concept.

I've shown where the costs of shipping has also skyrocketed. The responses? Liberal libtard liberals. When the vast majority of responses are nothing but internet troll type posts, it's quite easy to see who doesn't want to issue all of the facts surrounding the situation.
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The idea that you make record profits based on increased base price is faulty - businesses run on Margin. If you aim to make (or if you traditionally make) a 10% nett operating profit against your gross turnover - then the profit closely aligns with your turnover. That's how every small/medium/large business I know runs, it's how every company I have ever worked for runs. It's no doubt different for tiny companies and individuals.

Companies in 2021 are making record profit off less gross turnover. Businesses lost a lot of money during Covid, and they are trying to recover as much profit as possible during a time of high demand and shortages. It's not difficult.


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Let's see here, the government, both dems and republicans, printed money to cover stimulus checks, ridiculous over the top unemployment checks and tax breaks into everyone's pockets. The people spent that money, causing businesses to make a profit. Printing all of that money devalued the dollar to the point that we now have inflation. Now, we'll print a couple more trillion dollars to do the same thing.

Let's blame big business.


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So the US is 29 trillion in debt, and the article below has total stimulus and tax relief spend at roughly 3.5 Trillion in 2020. Those awful, ridiculous stimulus and unemployment spends are the only thing that kept every economy in the world from total collapse. Where exactly would we be without them today? I'm not sure, but I bet we'd be in a worldwide existential financial crisis, or the biggest depression in history. But then you have to factor in that the entire world went through difficulties the same in 2020. Every country had to help their people financially to some extent. The US probably carried much of that as well, helping poorer countries with vaccines, medical supplies, etc.

We agree that there is inflation, but I think the spending was not only necessary at the time, but that it staved off a much worse financial crisis. What we disagree on is where to lay the blame.

My wife's boss has raised prices about a dozen times since the beginning of 2020. A shipping container with raw vinyl materials that used to cost him about $3500 shipped pre-pandemic, now costs just shy of $29K! Shipping is way up and incredibly slow. With ports backed up, shortages are causing demand for goods to increase, and the entire worldwide supply chain has been disrupted, and each exchange (stop) along the way is now more expensive. So while it might not be big business, it certainly is the costs and losses being absorbed by big business that is driving this inflation. But the experts all think it will be temporary, we'll see.

Personally, I think the blame is multi-factored, mostly inevitable due to the pandemic, and primarily driven by the costs of business in our new normal post 2020. I'm also positive that some greed and stupidity is in the equation as well. What I do know is that neither Covid-19 handouts nor big business greed should be used as scapegoats.

2020 forbes article discusses spending impacts:

https://www.forbes.com/sites/robert...e-unsettling-scope-of-stimulus-spending/

Last edited by OldColdDawg; 11/24/21 03:43 PM.

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I think the bigger question is did we avoid a huge financial crisis then, only to kick the can down the road? I don't disagree with you that the economy would have tanked and there would have been a financial crisis. I would also agree with you, even through I didn't see you say this, that those on the bottom of the economy would have paid the highest price in terms of impact on their life. By contrast I also agree that at some point all of this debt too will create a huge financial crisis and there will be a price to pay for that ever increasing debt eventually.

Now don't get me wrong, if there is a time to spend money it's during a national crisis and Covid certainly qualified. But even that's a two edged sword. IMO it was a catch 22. I know a lot of people who received stimulus checks who really didn't need them because Covid simply didn't impact them. I include myself in that group. So it would have been nice to have had qualifiers for those who received them. On the flip side of that it would have slowed down the process to the point that it would have delayed those payments to those who were in a situation they simply couldn't wait that long.

The infrastructure plan is another spending program I felt was appropriate. Both Trump and Biden agreed it was needed, it was simply packaged in a different way. So to me infrastructure is critical to competing on a global scale and everyone from workers to business gain from it. It also in effect increases tax money generated by those jobs and businesses so you do get some return back on the investment.

What I find most odd is that far less people seem to bring all of this up when it's people they support doing the spending. Before anyone has a cow, I said far less, not all. Some people are fiscal conservatives and object to heavy debt spending equally no matter who is in office.


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Let's see
- government prints off nearly 5 trillion
- hands it out with no strings attached
- people spend this money
- business profit from the extra 5 trillion being spent

When people spend money, where did liberals think the money was going to go? Funny part is, this is essentially the 'trickle up' economics liberals have been wanting. Give money to the poor because they will spend it. But when they spend it, businesses will profit.


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Originally Posted by mgh888
The idea that you make record profits based on increased base price is faulty - businesses run on Margin.


Clearly, you have never run a business.

Cogs 1.00 margin 40% (.40) price 1.40

Cogs with inflation 1.30 margin 40% (.52) new price 1.72

That's a .12 increase in profit per product. (33%) increase in profit


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Supply of goods is down. Demand (consumer willingness to pay for an item) is up. Either factor by itself would result in a price increase, and together they drive up the price up even further. There should be nothing surprising about this.

Demand is up for a few reasons. The stimulus and the low interest rates absolutely contributed to this as far as I'm concerned. Take a look at housing, for example. A $250k house with a 30 year mortgage, 20% down (meaning a $200k loan) with a 5% interest rate results in a monthly payment of $1,074. If the rate drops to 3%, the payment becomes $843. At the 3% rate, the same house can be sold for $318,500 (20% down, results in a loan of $254,800 instead of $200k) and still have the same $1,074 payment... which is exactly what we've seen happen. Consumers in general are primarily concerned with the monthly payment and not the actual purchase price. They are much more willing to pay (aka demand) a much larger sticker because the payment is the same. Add in the stimulus payments and people had more down payment to work with, allowing them to buy even more.

Autos are the same but probably even more relatable since in many cases the stimulus by itself was enough of a down payment. A $40k car could be sold for $50k with the same monthly payment. People had the money and in many cases likely didn't even blink at the asking prices.

Add in the shortages of housing and semi-conductors which in turn led to decreases in supply and the price increased even more.

The increased demand for housing will drive the cost of rent up.

And all of this ignores any psychological shifts in consumer demand that resulted from the pandemic lockdowns ("YOLO").

Our dollar is not tied to a precious metal but the prices of goods and services will have some correlation among them. Think of it in terms of how many __X good__ will buy ___Y service___ (my go to is "how many bowls at Chipotle will this now cost me?"). This is true because there is a scarcity of goods and services. We do not have unlimited resources and have to pick and choose what we want. Prices rise and fall because price is the rationing mechanism for the limited amount of goods and services available. Consumer demand does influence pricing - McDonald's can raise the cost of a Big Mac to $20 and sell a handful nationwide. At the end of the day, the cost of something is what the market is willing to bear.

There's some accurate tidbits in this article but the portrayal and interpretation are way off the mark. There's nothing nefarious about supply and demand. We all have to make choices. Politicians are to blame for much of this. Elasticity of pricing does play a part, absolutely, but this far from a "manufactured crisis" of pure corporate greed.



Quote
You’ve heard a dizzying array of explanations about inflation. Biden administration officials have said the Covid pandemic resulted in supply chain disruptions, which are now being ironed out. Republicans are blaming Biden’s policies for putting too much money into the hands of working families.


These are both contributing factors.


Quote
And what that means is pretty simple: Corporate America has seized on the fears of inflation to jack up prices on you and make a ton more money.

Overly simplistic opinion that the article itself doesn't support. As previously mentioned, consumer demand is way up. And as the example with housing shows, lower rates and an influx of cash will lead to higher prices when demand is still high.



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In these calls, business leaders employ fancy financial lingo to tell large shareholders how they are engaging in “pricing improvements” and “successful pricing strategies.” They tell you they are experiencing customer “elasticities” to price increases at historically low levels. When you decode what they’re saying, it’s nothing less than a euphoric articulation that they’re able to pass off price increases to consumers, who, in the words of legendary investor Warren Buffett, are “just accepting it.” The stocks have in turn moved higher and higher. (And interestingly, when a corporation like Target announces it hasn’t raised prices despite strong earnings, investors are punishing it by pushing the stock downward.)

Elasticity is playing a huge part, absolutely. This is a consumer (demand) issue, not the corporation's (supply side) issue. If people are willing to pay more they will be less sensitive to price increases. They are "just accepting it." There are limits to this - see the Big Mac. Where you can get into trouble is with "necessities" but I haven't seen too many issues with that at this point, and increases here largely seem to be a reaction to increases in other goods/services, not price gouging. Beef (especially for holiday purposes) is not a necessity to live. There certainly is some supply side leverage from the consolidation of the meat suppliers, but again they cannot charge what consumers are not willing to pay.

Said another way, I love Chipotle. I eat it every week. They know I eat it every week because I am in their loyalty program. If they raised the price of a bowl from $9 to $13, I'd still eat it every week because I value it more than $13 - my demand is inelastic. For other people, if they raised the price from $9 to $9.50 that would be enough for them to cut back on their Chipotle consumption. Their demand is elastic.

Should I blame Chipotle that I am willing to pay more than $13 for their product? "Hey, you guys really suck for delivering a good product!" Yes, that will work. It's their fault, not mine. At least that's what the article would have you believe.

Price increases have almost always been passed off to the consumer - when the market is willing to bear it. This is the second time the article acknowledges rising prices which counters its premise that this pure corporate greed.


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Home Depot and Lowe’s recently posted incredible earnings, pleasing giddy investors. CNBC’s voluble Jim Cramer observed that these two companies “can do no wrong because they’re passing on rising costs to the public, and the public has no choice …because these two chains have single-handedly wiped out the competition already.”

Another example acknowledging rising prices. Consumers do have a choice - HD and Lowe's are not selling necessities. Consumers just want their bathroom remodeled right now. That's a choice.


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The power is entirely in the hands of large corporations, and they’re going for the gold. This story of corporate greed is being missed in the national inflation conversation.

But there’s more! Think about the devious design of what corporations have been up to.

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As we head into Thanksgiving and Christmas, and we all look forward to large enjoyable feasts with friends and family, we should rightly harbor anger about inflation. Not just that they made us pay more for turkey, cranberries, and pie crusts. We’re having to pay more because corporate America made a choice to raise prices on us, and then on top of that, it tried to manipulate your fear about those prices to keep you from getting paid leave, home care, childcare, and climate change action. Corporate America made you pay more while trying to make sure it didn’t have to

Yes, objective reporting at its finest. With some of the word choices it's almost as if they had an agenda to gaslight readers about the situation and who to blame. If we should be frustrated with anyone, it's the politicians and our fellow consumers who are willing to accept these prices. Without consumer demand this pricing doesn't work.

But hey, we all need a boogeyman from time to time. Ain't that right Liz?

https://twitter.com/SenWarren/status/1463598298208473088



TL;DR: I fail to see how this is a manufactured crisis rooted in corporate greed given the levels of consumer demand. Acceptance/willingness to pay is distinct from having to pay - no one is forcing them for most goods/services. The meat of the article does not support the premise it makes.

DawgTalkers.net Forums DawgTalk Palus Politicus Inflation? Nope, manufactured crisis by corporations

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