Greed-led Inflation

Assalamu alaikum warahmatullahi wa barakatu, everyone. This is Shahid Bolson. Welcome to the Middle Nation. From the late nineteen forties to the nineteen sixties, the world experienced industrial demand led inflation because of the launch of post World War two globalization. In the nineteen seventies, there was consumer led inflation because the baby boomers were all having children, having families, and spending a lot of money.

So what is leading the wave of inflation today? Now most people would tell you it's because the energy prices are so high due to the war in Ukraine and the sanctions against Russia, but the truth is we were moving in the direction of inflation well before the Russian invasion invasion of Ukraine. The actual data reveals a very different driver behind the current surge of inflation and the subsequent global economic and food crises that the world is suffering, and it's worth looking at. More than half of what is contributing to higher prices in goods right now is corporate profiteering. It's not labor inputs like wages or non labor inputs like energy.

It is very simply price gouging. It is opportunistic enlargement of the corporate profit margin under the pretext of crisis. In other words, it's not actually inflation, it's just overcharging. Corporate profits are soaring. CEO pay packages are soaring.

For this tiny segment of the population, the global food and energy and economic crises that are engulfing the world are a bonanza. Meanwhile wages constitute the smallest contributor to unit prices for goods in recorded history. In fact, in Europe real wages are plummeting. So quite simply we are experiencing corporate greed led inflation, and this is just a continuation and an intensification of a trend that has defined the global economy for decades, because the owners of wealth are also owners of power and influence, and particularly in a country like The United States where they don't really have any substantial alternative power structures other than class. There is no substantial religious social architecture, no tribal or extended familial social architecture, no intellectual or academic social architecture which can provide alternative sources of authority that can compete with wealth.

The rich, therefore, wield unrivaled control over policy, over discourse, over accepted economic theory, and over regulations and the law. Therefore, those who are at the highest levels of income are able to dictate the way the economy works. So it's unsurprising that they would insist that the economy functions in such a way as to secure and serve their own selfish interests, even if that means the destabilization of the society itself. So in fact what we are calling inflation is actually just progression of an economic system dominated by and singularly dedicated to the interests of private sector elites. Even those aspects of the current situation that do reflect traditional explanations for inflation, like the decreased value of the currency due to excessive printing of money.

Even this is due to the same subordination of the economic system to elite interests. Every financial disaster of the last twenty years was caused by the reckless and predatory greed of the rich ruling class, and every wave of money printing has been primarily to insulate that class from the consequences of the disasters they caused. So now we have the combination of rampant price gouging and decreased value of the currencies. The only companies that will benefit from this scenario are the biggest players in any given sector. They can afford higher input costs and they have more latitude in adjusting exaggerated profit margins.

This will further their relative power over the total economy. This is most starkly true in terms of agriculture. The global food crisis is going to devastate subsistence and family farming, and it will increase world dependence on the few top tier big agribusiness companies. They will undoubtedly expand their portfolios across the developing world, giving them seed to shelf control over much of the world's food security. The crises that we are experiencing are not just the consequences of neoliberalism and the concentration of wealth, they are themselves strategies of neoliberalism and tactics for the further and concentration of wealth and power.