Biden has prodded the Agriculture Department to investigate large meatpackers that control a significant share of poultry and pork markets, accusing them of raising prices, underpaying farmers - and tripling their profit margins during the pandemic.
Larry Summers has now returned to the debate ( yet again) with an enjoyably brutal thread on Twitter, taking down the administration’s idea that antitrust can be deployed as a weapon against inflation.Īs rising inflation threatens his presidency, President Biden is turning to the federal government’s antitrust authorities to try to tame red-hot price increases that his administration believes are partly driven by a lack of corporate competition. Top Clinton and Obama White House economist Lawrence Summers warned Democrats that ARP would accelerate inflation.Īnd inflation is precisely what occurred. And once America’s output capacity taps out, any additional stimulus will simply bring inflation. Even for those soft Keynesians who believe that government spending has a small multiplier, a $1.9 trillion stimulus bill would vastly overshoot the output gap. In early February, CBO estimated that the baseline economy would operate $420 billion below capacity in 2021, and a total of $857 billion (or about 1 percent) below capacity over the next four years before returning to full employment in 2025. The current transitory inflationary surge is by no means solely down to its policies - far from it - although the $1.9 trillion American Rescue Plan passed earlier this year will certainly have played its part.īrian Riedl, writing for Capital Matters a couple of weeks back:ĪRP’s more urgent failure is its significant contribution to today’s soaring inflation. Say what you will about the Biden administration, but subtlety is not one of its stronger points. Shopper at a grocery store in Los Angeles, Calif., November 11, 2021.
0 kommentar(er)
