How greedy corporations and lax laws are driving inflation – and what we can do about it: Robert Reich

How greedy corporations and lax laws are driving inflation – and what we can do about it: Robert Reich
Former United States Secretary of Labor Robert Reich (screengrab/YouTube).

Former United States Labor Secretary Robert Reich published a new video on Tuesday in which he tackles the "real" reasons behind skyrocketing prices and what consumers can potentially do about it.

"Inflation is a cover corporations are using to squeeze more money out of you," he begins. "But as I’ll explain, there are five things we can do to fight back."

Reich's premise is simple. Large corporations, unhindered by effective regulations or impactful competition, are gouging customers while raking in record profits.

That, Reich argues, is purely a result of unbridled greed, and evidenced further by stagnant wages.

"Are they using these record profits to raise their workers’ real wages? No. They’re handing out meager wage increases to attract or keep workers with one hand, but effectively eliminating those wage increases by raising prices with the other," he explains. "Wages grew 5.6 percent over the past year — but prices rose 8.5 percent. That means, adjusted for inflation, workers actually got a 2.9 percent pay cut."

This, he adds, is a "direct upward transfer of wealth from average working people’s wallets into CEOs’ and shareholders’ pockets. Just look: billionaires have become at least $1.7 trillion richer during the pandemic, while CEO pay (based largely on stock values) is now at a record 350 times the typical worker’s pay."

Reich also pours cold water on the Federal Reserve's plan to raise interest rates, calling it a "grave mistake because it doesn’t address corporate concentration and it will slow job and wage growth. The labor market isn’t 'unhealthily tight,' as Fed Chair Jerome Powell claims. Corporations are unhealthily fat."

Reich then offers five common sense solutions that would level the playing field for workers and consumers:

  • Stronger antitrust laws and breaking up monopolies to increase competition and lower prices
  • Windfall taxes with revenues being "redistributed" to American taxpayers
  • Ban corporate stock buybacks
  • Raising income taxes on corporations and the wealthiest Americans
  • Strengthening labor unions

"In short, the real problem is not inflation," Reich concludes. "The real problem is the increase in corporate power and the decline in worker power over the past 40 years. Unless we address this growing imbalance, corporations will continue siphoning off the economy’s gains into their CEOs’ and shareholders’ pockets — while everyday Americans get shafted."

Watch below:

How Corporations Are Using Inflation To Take Your Money www.youtube.com

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