Inflation, or the increasing of prices, is higher than it has been at any point since 1990. These skyrocketing prices for everything from food to gasoline are hurting workers nationwide. The problem is that inflation isn’t some natural thing that happens because of the magical laws of supply and demand, or because we’ve done something wrong, or because somebody printed too much money. It happens because corporations are always looking to increase their rate of profit.
Take oil and gas for example. ExxonMobil, Chevron, and other major oil companies aren’t raising their prices because they’re barely getting by. Just the opposite. ExxonMobil just posted its highest quarterly profits in seven years, and Chevron posted its highest quarterly profits in eight years. These corporations could easily charge less for their product, but they don’t, because they know that hundreds of millions of Americans have no other transportation options. So they increase prices because they can. This type of inflation is what hurts us most directly.
We obviously want these price hikes to stop. But the problem is that within the capitalist economic structure, even the proposed cures make the problem worse!
Take the proposed gas tax freezes being implemented and discussed in some states to make it look like the politicians care about us average folks. Even if enacted, this measure wouldn’t necessarily have the desired effect. For one thing, this would just shave pennies off our costs, as opposed to any real relief. Second, the decrease in state tax revenues, which in many states are significant portions of state budgets, would most likely be used as an excuse to cut various social services (health care, education, housing assistance, and more) that we desperately need.
The other major “weapon” against inflation that capitalist economists and politicians are already putting into effect comes from the Federal Reserve banking system. By raising interest rates, the Federal Reserve can slow economic growth in hopes of curbing inflation. But even if this works, it also creates problems for us. When interest rates go up, so do our credit card rates, and so do the rates we’re charged to pay back loans for college education, car loans, and mortgages. In other words, we get hit twice. Meanwhile, banks and loan companies are making a killing.
This system is rigged so that even the proposed solutions hurt us, and corporations use the excuse of inflation to sneak away like a robber in the night. How much longer will we let them get away with these many layers of outright theft?