Anne McLeodJan 15, 2023
Robert Reich

Inflation in the U.S. is being driven by profits, not wages. And interest rate hikes don’t reduce profit-driven inflation.

What they do is put the burden of inflation on lower-wage workers and the poor.

How about we target corporate profits, not working people, for a change?

Jan 15, 2023 at 12:06amWeb
Show threadDan, the US is the threat!Jan 15, 2023
@rbreich Not with the Buy-your-own-representative! System as it is right now! 🙄
Profound changes are required and people that are dedicated to this will be needed before it happens!
Show threadJeff Shaffer CBET, retJan 15, 2023
@rbreich I wish there was a way to boost this twice, those corporate profits are going into the hands of some politicians or else they would address it. I think I t’s easy to see which ones, but dark money makes them all suspect
Show threadYugoboyJan 15, 2023
@rbreich now that's downright in American of you.
Imagine all the suffering those poor corporations would go through not being able to give their CEO double-digit million-dollar bonuses.
Shameful!
Show threadRobes1Jan 15, 2023
@rbreich but that would require Congress to be willing to tax them? Their will is as fleeting as voters’ attention span….
Show threadBill NewmanJan 15, 2023
@rbreich yessir … you can’t use monetary policy to push down prices on commodities and material that have a higher structural cost due to scarcity, demand and restoring
Show threadMcNamaraMPJan 15, 2023
@rbreich not just on the US. Here is #Australia we have echoes had nearly 10 years of almost zero wage growth, massive growth in profits and rampaging inflation but the Reserve Bank tells us we can't have real wage growth. Go figure!.
Show threadBadtux the Snarky PenguinJan 15, 2023
@rbreich Corporate profits in the US are being driven by supply-chain & distribution distortions limiting supply available to people. Less supply, same wages, higher prices. If not for supply chain issues new competitors would arise to undercut the profits of the corporate looters.We need to fix the supply chain & distribution distortions, then the profiteers will find themselves unpleasantly out-competed.
Show threadBaron VonskinnbackJan 15, 2023
@badtux @rbreich unfortunately you can't do that whilst the world refuses to recognise that the pandemic is causing these issues, millions of working age people dead or unable to work due to damage caused by the virus, healthcare system under immense strain for people who can afford to use it, a prolonged and painful death or total bankruptcy for people who can't, what do we think will happen to the global economy now that China has allowed the virus to run free?
Show threadBadtux the Snarky PenguinJan 15, 2023
@Vonskinnback @rbreich Some short-term laws to address profiteering may decidedly be in order. As Reich properly points out, the current "inflation" is in fact profiteering, taking advantage of temporary supply chain conditions in order to hike prices for inordinate prices. In the long term they will be self correcting as new supply comes online. Of course, in the long term we're all dead.
Show threadBaron VonskinnbackJan 15, 2023
@badtux @rbreich you are absolutely right, traditionally inflation was caused by spending pressures based on demand outstripping supply due to an abundance of disposable income, this was resolved by stripping that money out of the economy by raising prices, but this time round it is because of damage caused by an outside force putting pressure on the supply chain, but they still saw fit to strip cash from the population when there wasn't an abundance.
Show threadEyalLJan 15, 2023

@rbreich
That suggests there isn't enough competition.

Addressing profits probably means much stronger antitrust regulation and breaking down monopolies

Show threadmdhh_usa 🇺🇸Jan 15, 2023

@rbreich

Agreed.

Show threadLeslie LieuranceJan 15, 2023
@rbreich Sounds about right.
Show thread@frank609Jan 15, 2023
@rbreich Agreed we need to crack down on corporate price gouging (and failure to pay salaries that keep up with inflation, much less productivity gains). But keeping interest rates too low, as they have been in recent decades, also create other problems. Such as asset bubbles in real estate that benefit mostly the rich. There is an ideal interest rate. I don't know what it is - but it is more than the 0% we've had until recently, and probably less than the 13%+ we had in the 1980s.
Show threadAntonVonCarmoJan 15, 2023
@rbreich because the poor don't fight back.