WASHINGTON, D.C. — Across America, consumers are feeling the impact of rising costs. Everyone agrees, it’s hitting middle-class and low-income families the hardest. However, the root causes of the issue have politicians and experts in Washington, at odds.
This morning, Senator Bob Casey (D- PA) released a report, which he says exposes big corporations for price gouging, or “Greedflation.”
“Everywhere I go, it’s probably the number one issue I hear about,” said Casey.
Casey says food, gasoline and utility bills are just a few things that have gotten more expensive for consumers as profits for big corporations skyrocket. He calls it “Greedflation.”
“Meaning that major corporations are using inflation as a cover to jack up their prices. That hit consumers really hard, especially families raising children,” said Casey, adding that he was disturbed by some of the report’s findings. “That combination or juxtaposition of high corporate profits and then sky-high prices is about as disturbing as anything else I’ve read in the research.”
According to Casey’s report, Greedflation cost the average Pennsylvania family an extra $3,194 in 2021 and $3,546 in 2022.
“We can’t allow them to do this. We’ve got to take them on. We can’t just throw up our hands and say, ‘Well, that’s the that’s the nature of our system.’ This isn’t capitalism. This is a perversion of capitalism,” said Casey.
But others argue that too much government spending and borrowing is what leads to higher costs.
“The government creates inflation when it spends too much and borrows too much, specifically when the borrowing is so great that the Federal Reserve needs to buy it. And by buying it, they expand the money supply,” explained Kurt Couchman, Senior Fellow in Fiscal Policy at Americans for Prosperity. “When the money supply grows significantly faster than the economy is growing- the overall production of goods and services, then that that gap between the money supply and economic growth, that is what inflation is,” Couchman added.
Couchman says the answer is broad-based economic growth, with less barriers and more competition. One way to achieve that, Couchman says, is by eliminating government-imposed barriers to competition, making it easier for other companies to provide a better product at a lower cost.
“If one company is doing something that just isn’t right, then somebody else can come in and take market share from them by providing a better service at a more affordable cost,” said Couchman.
Casey agrees competition is necessary, but he also believes in more disposable income for working families and holding big corporations accountable by making them pay their fair share.
“If that means an excess profits tax on oil companies, if that means extra pieces of legislation and policy to stop any kind of food manufacturer from jacking up their prices, we’ve got to take those actions,” said Casey.
One way Casey and other Democrats want to help families is by reinstating the Child Tax Credit. The program, a part of the American Rescue Plan and supported by Casey, provided monthly payments to help families pay for food, rent, school supplies and childcare.
According to the Economic Policy Institute, Child Tax Credit expansions were instrumental in reducing child poverty to historic lows in 2021.
