Americans Believe Corporate Greed is a Major Cause of Inflation

According to a recent Navigator Research poll, a growing number of Americans, now 3 out of 5, believe corporate greed is a major factor in inflation. This marks a significant rise to 59% from January 2022’s 44%.

Greed Fueling Inflation?

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The poll, conducted by the left-leaning group, surveyed 1,000 registered voters between January 25-29.

Maryann Cousens, an associate of polling and analytics at Navigator Research, commented, “After more than two years of corporations posting record profits while Americans struggle to balance their checkbooks, it’s no surprise that people increasingly see corporate greed as a problem.”

Peaks and Falls

Inflation, as tracked by the Labor Department’s CPI, soared to 7.5% in January 2022 and peaked at 9.1% six months later. By January, it had fallen sharply to 3.1%, yet remains over the Federal Reserve’s 2% goal.

Impact on Savings

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In response, the Fed raised interest rates from nearly zero in March 2022 to between 5.25% and 5.5% by July 2023, aiming to curb demand and, theoretically, inflation.

However, this increase has eaten into savings, previously bolstered by pandemic stimulus, with a noticeable rise in delinquencies across credit cards, mortgages, and car loans.

High Inflation, Higher Profits

In a contrasting trend, companies have maintained high profits even amid high inflation, with a peak in the third quarter of 2022- the height of inflation, as per St. Louis Federal Reserve data, and profits are still above levels seen before the pandemic.

A New Economic Term

“Greedflation,” a concept that has stirred debate among economists, has now been officially recognized by Dictionary.com. It’s defined as a rise in prices caused not by market forces but solely by those in corporate or property ownership positions to boost already substantial profits.

Belief Grows Across Parties

Interestingly, the belief in corporate greed as a driver of inflation is now as widespread as the view that government spending is to blame.

Among Democrats and independents, belief in corporate greed’s role in inflation has grown by 17 percentage points, and among Republicans, it has increased by 13 points.

Beyond Traditional Theories

“Greedflation” describes a scenario where inflation is driven not by traditional economic factors like supply and demand imbalances but by deliberate price hikes from corporations or property owners.

This concept suggests that these entities increase prices to boost their already substantial profits, rather than in response to market pressures or costs.

Challenging Conventional Inflation Views

The term implies a manipulative profit motive at the expense of consumers, diverging from conventional economic theories of inflation causation.

While not universally accepted among economists, it reflects a growing public sentiment about the role of corporate practices in inflation.

Americans Agree

A staggering 84% of participants in a recent poll agree that corporate greed, characterized by companies raising prices to achieve record profits, is a contributing factor to inflation.

The belief varies across political lines, with 72% of Democrats, 62% of independents, and 45% of Republicans viewing corporate greed as a “major cause” of inflation.

Workers Over CEOs?

Maryann Cousens commented on these findings, stating, “This is only the latest evidence that an economic platform which puts workers ahead of CEOs and corporations is a popular, cross-partisan way to address the things Americans still worry about the most: the cost of living and inflation.”

Financial Optimism

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Despite Americans feeling more financially optimistic since the onset of the pandemic in 2020, as per the latest data from the New York Fed’s Center for Microeconomic Data, this sentiment does not fully extend to President Biden’s economic management as the election approaches.

Biden’s Approval Rating

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Biden’s current approval rating stands at 41.2%, based on Decision Desk HQ/The Hill’s polling averages. In a potential general election face-off against former President Trump, the leading Republican candidate, Trump holds a 2.2% edge.

Trump Leads Biden

A recent Financial Times poll reveals a significant lead for former President Trump over President Biden regarding economic management, a critical factor in presidential elections.

Economic Battle

The poll indicates that 42% of participants believe Trump would better manage the U.S. economy, while only 31% prefer Biden, with the remainder undecided or supporting neither.