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Inflation excerpts, by Robert Kuttner
Source Charlie
Date 22/01/18/12:31

Reading the Inflation Numbers Wrong (excerpts)

by Robert Kuttner, The American Prospect, January 12, 2022

If we are ever to fix the supply chain mess, we need to bring home a lot of industries. That will take the kind of public investment proposed in Build Back Better, as well as re-regulation of predatory industries that make up the links in the chain.

Take a close look at the sectors where prices have increased most. They are mostly the result either of purely temporary supply bottlenecks (cars, semiconductors), opportunistic price hikes (shipping, meat), and manipulated supply and demand (oil). Only a minority, such as lumber, conform to the standard story line of increased demand raising prices.

The unwillingness of low-wage, frontline workers to work in hazardous conditions for a pittance has raised labor costs, some of which have been passed along in higher prices. This is a long-overdue gain. Higher wages are a problem only if you think that the worker earnings that prevailed two years ago were acceptable. Cut corporate concentration, stock buybacks, and the grotesque concentration of wealth, and there will be more money to compensate workers without raising consumer prices.


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