"Combat Illegal Corporate Behavior" - Dem Lawmakers Urge Biden To Use Executive Action Against High Food Prices
Greedflation is a myth, and Democrats are well aware of this. However, they will never acknowledge that corporate greed isn't the root cause of inflation, as greed tends to be constant in the economy. What changed is the overstimulation of the economy through failed Bidenomics, which involves spending $1 trillion every 100 days.
In the early days of Russia's 'special operation' in Ukraine, the Biden administration was able to scapegoat any failed economic policy on the 'Putin Price Hike' narrative - but not so much anymore - as they've pivoted the propaganda cannon from Putin to mega-corporations through their cheerleaders at leftist corporate media outlets. Now it's all about popular buzzwords 'greedflation' and 'shrinkflation.'
Shown below via Bloomberg data, headlines featuring 'greedflation' in corporate media spiked in the summer of 2023, right around the time the administration launched the Bidenomics propaganda campaign. We all know Bidenomics has stoked a complete inflation shitstorm. However, Biden's team is giving greedflation one last shot ahead of the November presidential elections to deflect blame on corporations for why working poor Americans can no longer afford to pay rent, eat at restaurants, afford the $1,000 monthly auto loan, and any other luxuries they were accustomed to before the worst inflation mess since the 1970s. Basically, Goldman's brightest warned the other day: low-income consumers are in trouble.
We suspect the greedflation narrative won't stick—just like the failed Bidenomics campaign—because Americans are waking up to the out-of-control spending in Washington, DC.
But anyway, Democratic Senator Elizabeth Warren, who once identified as a Native American, and other leftist lawmakers penned a very public letter (all about optics) to the Biden administration, requesting the immediate use of executive action to lower food prices.
"We commend the important steps your administration has recently taken on this issue, including steps to combat illegal and unfair corporate behavior, encourage competition in the food and grocery sectors, and more. The federal government should use every possible tool to lower food prices," Warren and other lawmakers wrote.
They continued, "We believe you can exercise your executive authority to take additional action to address rising food prices without congressional action. Americans are facing sky-high food prices, caused by excessive price gouging by food and grocery giants."
Democrats begging for price controls sounds like what communist or socialist lawmakers in third-world countries do. Yet, these lawmakers never learn a proper lesson (look at Cuba, North Korea, and Venezuela), where imposing price controls triggers shortages or surpluses, longer lines, lower quality products, and, of course, misallocation of products.
But, honesty, Democrats could care less. They have a mission of spending to bankrupt the nation literally, somehow lower prices in an inflation storm, and enable illegal aliens to vote.
Instead of blaming corporations, let's remind readers again that overstimulating the economy generates price increases and windfall profits, so it's not smart for lawmakers to do so. And this overstimulation, which Duquesne Family Office Chairman & CEO Stan Druckenmiller pointed out last week, is likely one of the biggest economic policy errors ever:
If I was a professor, I'd give them an F. Basically, they misdiagnosed COVID and thought it was -- we were going into a depression. The Fed did, too. I worried about it, too, in early days. The Fed eventually pivoted, better late than never. Treasury -- Treasury is still acting like we're in a depression.
We outlined last summer that "stealth stimulus" was propelling Bidenomics, with the government spending $1 trillion every 100 days. Now, with stagflationary threats emerging, the US economic situation is quickly deteriorating.
And here's what comes next when the government starts calling for price controls, as explained by Alt-Market's Brandon Smith:
This same pattern has been witnessed from 1920s Weimar Germany to 1970s America to 1990s Yugoslavia to 2000s Argentina and Venezuela and beyond. But what happens next? In each case the trend leads first to price controls on producers and distributors, which ultimately fail. Then comes government rationing and the complete takeover of necessities including the food supply.
Smith continued:
The problem is simple, price controls lead to lost profit incentive which leads to less production. Less production leads to less supply and less supply leads to rising prices. This is on top of the root cancer that is fiat money creation. Politicians will rarely if ever address the actual cause of an inflationary crisis: The government and the central banks. Instead, they try to blame free markets, “greedy” businesses and profit taking in times of distress.
He concluded:
Historically speaking, though, both Democrat and Republican presidents have tried price controls in the past. Public pressure must be applied (at the state level at minimum) to stop this from happening. As convenient as it might seem to blame producers and distributors, the real threat is coming from governments and banks. We cannot let the people who caused the crisis also benefit from it by giving them even more power.
It's a slippery slope from here...
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Here's the full letter: