White House economists push back against pressure to blame corporations for inflation

[Celerity]

https://www.washingtonpost.com/us-policy/2022/02/17/white-house-inflation-corporations/

When the prepared congressional testimony of a senior administration official was circulated inside the White House in recent weeks, it included a passage tying inflation to corporate consolidation and monopoly power.

That language was eventually taken out of the remarks before they were delivered. Members of the White House Council of Economic Advisers had raised objections to the idea that a spike in prices was due to corporate power, according to two people aware of the matter who spoke on the condition of anonymity due to fears of professional reprisals.

The alteration of the testimony highlights the tensions within the administration over whether the White House should blame corporate consolidation and monopoly power for price hikes. Some officials in the White House National Economic Council believe the administration could more aggressively advance that argument, and Democratic pollsters have told the White House that a populist economic message on corporate greed and prices broadly resonates with voters.

But economists inside the administration, particularly at the CEA, are uncomfortable with the push. “It’s been the war of the ‘track changes’ inside the administration over how much the White House can lean in on the extent to which competition and greed are driving inflation,” said one person briefed on the internal dynamics, who spoke on the condition of anonymity due to fear of professional reprisals.

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related


More than half of retail businesses are using inflation to price gouge

https://digital.com/half-of-retail-businesses-using-inflation-to-price-gouge/


How Much Are You Willing to Pay for a Burrito?

The pandemic has led to the largest price spikes at fast-food restaurants in two decades.

https://www.nytimes.com/2022/01/21/business/fast-food-prices-inflation.html

snip

“I would say that our ultimate goal, so this would be over the long term, maybe the medium term, is to fully protect our margins,” said Jack Hartung, the chief financial officer of Chipotle, on a call with Wall Street analysts last fall. “When you look at our pricing versus other restaurant companies’ for the quality of the food, the quantity of the food, and the quality and convenience of the experience, we offer great value. So we believe we have room to fully protect the margin.”

That doesn’t mean customers are thrilled about the extra costs. This month, Jacob Herlin, a data scientist in Lakewood, Colo., placed an order: a steak-and-guacamole burrito for $11.95, a Coca-Cola for $3, and chips and guacamole, which were free with a birthday coupon. The total was $14.95, before tax.

But when he clicked to have the food delivered, the price for the burrito jumped to $14.45 and the soda climbed to $3.65, bringing the total to $18.10 before tax, 21 percent more than if he had picked the food up himself.

There was more. Mr. Herlin was charged a delivery fee of $1 and another “service fee” of $2.32, bringing the total for the delivered meal to $23.20. He tipped the driver an additional $3.

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I never thought I would see the day where US prices for everyday quotidian food BLOW past what we pay for it here in Stockholm (a Big Mac, for instance, anywhere here in Stockholm costs 35kr, ie around $3.75 and sometimes it is buy one get one free), AND do not forget we have VAT and our low end workers are paid more (at least more than many US areas pay), so those are added into our costs. Earlier this evening I ordered 4 complete dinners (multicourse and drinks included) of killer (some of it was some of the best vegan fast food I have had in ages, and also some of it was meat/seafood, lamb and shrimp) Palestinian food, delivered, and it cost me 320kr, which is around $34 total, for 4 people.

[Kittycatkat]

1. Biden needs to push this truth. Enough is enough! This is so f#$%'d up

[multigraincracker]

2. Hard not to when it comes to drug prices.

There are more than one Pharma Bros, they all are.

[Celerity]

5. Oh, US pharma prices are outrageous compared to most other advanced nations, as is the cost of

tertiary education. So much of the US economy is one giant wealth extraction scheme. Take from the massive (in population size) broad-based lower levels and shovel it up to the gaping maw that is the top of the pyramidion.

It isn't like it is being hidden, lol:

pyramidion

[thatdemguy]

3. I am an electrical estimator

Copper prices are up 175% from 2 years ago, steel prices are up 150%. My suppliers have actually lowered their profit %, they used to mark up wire to me 7%, they are now doing 5%. So its not them or my company ( I am not the owner ) making jobs cost more. We have actually lowered out "profit" % we add on jobs, even thou it was never really profit, it was eaten up in normal costs we just trimmed them back.

Also I have huge problems with switch gear for buildings, things that used to take 6-8 weeks on average now might take 11 months. Its all due to small parts that go in the large breakers. SQ d also moved production back to the US from Mexico due to Covid and border issues.

[multigraincracker]

8. The markets driven by speculators.

They have no direct interest in the item or commodities they bet on. Futures markets use to be helpful those that depend on the commodities they used. Airlines and other transportation could hedge their cost on fuel. Then those futures were offered to those that can't take delivery. In other words it became a casino. Once the futures market was opened up to them, prices went nuts.

[thatdemguy]

10. I actually feel

Its the value of the dollar, copper is a world wide commodity. If the dollar falls in to relation of a pound of copper, it will take more dollars. Look at the link below to compare the dollar to the euro. also its also fuel and labor costs have gone up.

[link:https://www.xe.com/currencyconverter/convert/?Amount=1&From=EUR&To=USD|

[underpants]

4. $$$ campaign money

They don’t want to scare away or piss off money

[Celerity]

6. atm it is potential voters who are being scared away and pissed off

[AZProgressive]

7. They should point this out more often

Democratic pollsters have told the White House that a populist economic message on corporate greed and prices broadly resonates with voters.

We need to be hearing this from all Democrats.

[Celerity]

9. I wouldn't hold my breath waiting for that to happen.

[WHITT]

11. Start With An Easier Truth

Biden inherited the inflation:

[MichMan]

12. Perhaps the Colorado Data Scientist could get off of his lazy ass and pick up his own food

Instead of complaining about the cost to have it delivered to him while he sits on his couch.

[sleroy49]

14. Mr. $3 tip

Seems like kind of a cheapskate.

[elleng]

13. Imagine that, 'economists' disagreeing!