I noted in February that corporate profit-taking is driving higher costs for consumers far more than any of the politicians or policies that Kristi Noem and other corporate shills are scapegoating. The Guardian weighs in with more evidence that we’re being screwed not by big government but by big corporations:
The analysis of Securities and Exchange Commission filings for 100 US corporations found net profits up by a median of 49%, and in one case by as much as 111,000%. Those increases came as companies saddled customers with higher prices and all but ten executed massive stock buyback programs or bumped dividends to enrich investors.
…The analysis found commodity companies trading in oil, timber, rubber, meat, wheat, steel and mining recorded the highest profit increases, while restaurants and retailers saw comparatively lower improvements, or losses. Commodity price spikes reverberate down the supply chain, eventually hitting consumers, noted Martin Schmalz, an Oxford University economist.
The Guardian’s data, he added, objectively shows a massive “transfer of wealth” from consumers, who pay higher prices, to shareholders and investment firms that reap the benefits [Tom Perkins, “Revealed: Top US Corporations Raising Prices on Americans Even as Profits Surge,” Guardian, 2022.04.27].
Supply-chain issues are responsible for a big part of our inflation, but a big part of our supply-chain issues come from profiteers choosing to make less and charge more:
Two of the nation’s largest builders, PulteGroup and Lennar, intentionally kept home starts low and took other steps seemingly designed to maintain high prices by restricting supply.
“We could sell another 1,000 homes in the quarter if we wanted to without too much effort. It just doesn’t make sense to do that,” Lennar co-CEO Jon Jaffe told investors in an earnings call. Lennar’s profits are up 78%, while PulteGroup’s jumped 97%.
…Just as PulteGroup kept housing starts down, oil companies have kept production low while gas topped $7 a gallon in some regions. In earnings calls across the industry, oil executives like Diamondback Energy CEO Travis Stice have promised to keep production flat in the years ahead, “putting returns and, therefore, shareholders first”.
“No one wants to see that shareholder return program put at risk with volume growth,” Stice said [Perkins, 2022.04.27].
If you want to vote anyone out for inflation, vote out the profiteering corporations who are raising their prices well above the rising costs of inputs and shoveling your cash into their bulging silky pockets. But, oh, that’s right: corporate raiders don’t answer to your vote. You can’t even vote with your pocketbook for their competitors, because they are eating their competitors and consolidating their markets.