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Blame our modern economy for today’s inflation

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The headlines are screaming that inflation will continue. Consumer prices rose an average of 6.2 percent over the past year, the sharpest increase since 1991. Although Americans are allegedly “flooded with cash and jobs,” according to the New York Times, they are also deeply dissatisfied with the state of the economy .

No wonder Republicans are excited and drawing the line between inflation, public concern about the economy, and Joe Biden’s presidency.

What is surprising is that President Biden himself is helping them by citing his administration’s effort to put more money in people’s pockets as part of the explanation for the current surge in inflation. Speaking on November 10, Biden said, “You all got checks for $ 1,400. They got checks for a variety of things, “and with the patience of an academic teaching an economics class, he went on to explain,” Well, if more people are buying products with money and fewer are buying, what h -pens? … The prices are rising.”

The New York Post, a conservative newsp -er, jumped on the speech, claiming the president “admits its COVID stimulus checks have been fueled”. [the] Inflation spurt. “

It is not natural to be at the mercy and whims of an economy developed by corporate profiteers for corporate profiteers.

The p -er downplayed Biden’s claim that “the supply chain is the cause”. In fact, the president led his audience through a fairly clear explanation of how the globalization of the economy works, has artificially lowered the cost of goods for decades, and is prone to disruptions like the one caused by the COVID-19 pandemic.

Biden said, “Products like smartphones often combine pieces from France and Italy; Chips from the Netherlands; New York State touchscreens; Camera components from J -an – a supply chain that crosses dozens of countries. “

Then he concluded, “This is just the nature of a modern economy – the world economy,” as if the massive web of consumer goods production was a fact of nature rather than a systematically deregulated system developed by multinational corporations to manage the material – and minimize labor costs and maximize your profit.

Remember, that is exactly what the anti-globalization movements of the 1990s protested. According to a 2007 essay by Mark Engler, the demonstrators included “trade unionists, environmentalists, anarchists, land rights and indigenous rights activists, human rights and sustainable development organizations, anti-privatization and anti-sweatshop activists” from around the world who claimed that “corporate globalization policies have exacerbated global poverty and increased inequality”.

When Biden said in his speech that “you have to use wood from Brazil and gr -hite from India before it comes together in a factory in the US to get a pencil,” he did not reveal that pencil manufacturers source wood from Brazil because they do could rely on illegal logging in the Amazon, driving down timber prices. Nor did he mention that the cost of transporting goods from the most remote parts of the world creates massive carbon emissions that are driving climate change.

Rather than blaming globalization for inflation, he concluded that it was simply “the nature of a modern economy” that we rely on. Most of the media have also missed this connection. Instead, the increasingly rare cases of the US government are blamed for ensuring that people have enough money to live on.

Why are Americans so unh -py with the economy?  -parently, according to Bloomberg’s Ramesh Ponnuru, it is “a recurring” pattern that there is widespread pessimism as wages rise. He rightly points out that “wages and benefits have risen smartly, but only nominally” and that “the positive trends need to persist before people start feeling satisfied”.

Go back to surveys that were done before the pandemic (like this one in 2018 and this one in 2019) and you can see widespread discomfort about the economy. In other words, Americans have been dis -pointed for decades with the ongoing suppression of wages and the trend towards increasingly insecure jobs in the so-called “gig economy”.

That may be why, despite their desperation about the economy, record numbers of people keep quitting. The latest report from the Bureau of Labor Statistics found that a record 4.4 million workers left their jobs in September alone, continuing the trend seen in August.

The Washington Post concluded that in addition to the search for jobs with better wages, the trend towards redundancies was also linked to “childcare problems”.

But when it comes to Conservative Republicans, you will see claims that Americans are deeply unh -py that the government is spending money on them, and that childcare subsidies and economic controls are at the root of the mass gloom – all ready-made talking points to win back politics Do this in the next election cycle to curb spending.

These kind of conservative messages include claims that Biden “does not understand how much inflation is hurting Americans” and “[i]Unless the Congress Democrats stop Biden and Pelosi’s plan, many Americans will not be able to pay their heating bills this winter, ”read an advertisement by the conservative Club for Growth aimed at vulnerable Democrats in the House of Representatives.

West Virginia Conservative Democratic Senator Joe Manchin makes similar connections to justify blocking Biden’s proposals to expand government aid.

The Liberal Democrats’ response to the current economic crisis is not much better, they either advise waiting for inflation or claim that the demand for better wages is fueling inflation.

Larry Summers, former Obama administration economic adviser, wrote earlier this year: “Higher minimum wages, stronger unions, more social benefits and more regulation are desirable, but they all also drive up business costs and prices.” Summers repeated a Republican Claiming that unemployment benefits are bad for the economy, saying: “Unemployment benefits, which allow workers to earn more when they don’t work than they do, should certainly expire in September.”

The prevailing message to Americans from political elites across the spectrum is the same as Biden’s speech: “This is just the nature of a modern economy,” and we have to deal with it.

Our current economic situation makes it easier to see that it is not natural to be at the mercy of an economy that was developed by corporate profiteers for corporate profiteers.

Sonali Kolhatkar
Independent media institute

This article was produced by Economy for All, a project by the Independent Media Institute.

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