As we continue talking about inflated profits, it’s important to understand our situation. Many Americans, especially seniors, have readjusted their ways of life to keep costs down. However, despite this 40-year record breaking inflation, private industries are celebrating record-breaking profits due to setting prices exponentially higher. This has many wondering about the relationship between corporate pricing and inflation. NPR’s interview with economic professor Isabella Weber offers insight into the problem.
Political Debate, Potential Action
Firstly, there has been no evidence of illegal market manipulation, but lack of competition in several private industries have politicians and economists wary of the possibility.
In January, President Biden said, “This (corporate greed) isn’t a new issue. It’s not been the reason we’ve had high inflation today. It’s not the only reason. But, over time, it has reduced competition, squeezed out small businesses and farmers, ranchers, and increased the price for consumers.”
The Federal Reserve stated that it would initiate several hikes on interest rates, lowering consumer borrowing power, to lower inflation. Currently, the debate is whether policy is needed to slow price increases for specific goods.
Additionally, corporate cost transparency might be needed. If a corporation’s costs were more visible, then a price increase might be more understandable.
Like Webber suggests in her interview, “we need to think of a different kind of response, and this requires us to have a very open conversation.”
Corporate Pricing and Inflation: Demand on the Consumer
We know there’s a relationship between corporate pricing and inflation, where prices rise more depending on demand and supply. If corporate practices hurt the consumer, then it becomes harder for the economy to recover. A senior on a fixed income will find it hard to maintain their quality of life, while being expected to adjust their demand when it’s convenient.
The Council for Retirement Security wants to protect Social Security, so every senior can receive their benefit. Corporate culture and inflation should not cost seniors more just in the name of profits. We can strengthen our benefits by taking control of our own buying power, finances, and demand for the things we want. Join us today in our mission to preserve a secure retirement for all hard-working Americans!