If you haven’t heard, Joe Biden is the economic antichrist and we need the Trump Party to save us. At least that’s what many Republicans would have you believe, as the Sean Hannitys and other bottom-dwellers lay inflation at Biden’s feet.
Their reasoning (if you can call it that)? It’s crazy liberal spending and the terrible damage Biden did by shutting down the Keystone XL Pipeline, they scream. Of course, as Professor David Nemet of UW-Madison and other economists have pointed out, the XL Pipeline, which would not have been ready till 2023 anyhow, would have had an “almost negligible” effect on gas prices, since it would have accounted for a mere 1% increase in production.
Hannity, of course, has an obsession over gas prices, but only if they’re up under a Democrat or down under a Republican, regardless of market conditions. Despite his blathering, experts point out that the increase in demand during the Covid recovery was bound to drive prices up.
Republicans also conveniently ignore all of Trump’s spending, especially when it comes to tax expenditures—the giant breaks Trump and Mitch gave to the rich and wealthy corporations.
Enter Katie Porter, whiteboard-toting, mini-driving mom and liberal hero. Interviewing Mike Konczal, a director at the progressive Roosevelt Institute, Porter pointed out that the primary driver of inflation – 54% of it—has been…(Wait for it. Waaaiiit for iiiiitt…) corporate profits! (Please put away your shocked face.) In a video that has now gone viral, Porter gives one of her classic whiteboard presentations to illustrate:
Bigger corporate profits account for *over half* of the higher prices people are paying. pic.twitter.com/RZr5O0X4oJ
— Rep. Katie Porter (@RepKatiePorter) October 18, 2022
Republicans love to let the bull run loose in the china shop, then point their fingers at the Dems cleaning up the mess and say, “Hey, look who’s in charge of this mess!” They did it with Obama, too, after he was left to clean up the American economy following the disaster that was the George W. Bush administration.
Robert Reich, my personal favorite economist, has been ringing this bell for quite a while:
As inflation continues to rise, corporations continue to rake in record profits. Corporate profits now account for a larger share of the American economy than ever before.
The problem isn’t government spending. It’s corporate greed. pic.twitter.com/tOIN531dEC
— Robert Reich (@RBReich) October 16, 2022
The next time you hear someone blame inflation on stimulus checks that Americans got almost two years ago, remind them that corporate profits are at a 70-year-high.
— Robert Reich (@RBReich) October 19, 2022
This is not to say that other things, including government spending, cannot be a factor. The war in Ukraine likely did help elevate gas prices. And Fed spending during Covid certainly contributed. But the former was something that we could not prevent (and that Biden has deftly handled) and the second was likely a necessary measure to stave off a worse economic disaster. Also, it should be noted that corporations largely took advantage of the Fed spending.
As pointed out by Steve Hanley of Cleantechnica, oil company profits are through the roof, with the five “majors” making a collective $55 billion in quarterly profits. Almost $18 billion of that was Exxon alone – the biggest quarterly profit margin it’s ever had.
(What say you, Mr. Hannity?)
Ross Rosenfeld is a writer from New York whose work has appeared in many publications, and who is proud to be hated by Rudy Giuliani and just as proud to be part of the Occupy team. Follow him on Twitter @RossRosenfeld.