Raising Prices Because They Can

Nov 22, 2021

The U.S. is experiencing the biggest inflation rise in decades. The consumer price index rose 6.2% last month, the highest rise since November 1990.

The pandemic and the “supply chain crisis” are often cited as causes. But there’s a more basic cause that companies are openly bragging about: they’re raising prices because they can.

Two-thirds of the largest publicly traded U.S. companies are reporting better profit margins this year than in 2019. A big reason for that is that they have used inflation as an excuse to raise their prices, according to former Labor Secretary Robert Reich.

Large companies like Proctor & Gamble, Kroger, and Walmart, PepsiCo and Coca-Cola, oil and gas companies, are raising prices beyond the rise in their own costs, actually increasing their profit margins while their own costs go up. They can do this because they’re so large and they control so much of the market that they don’t have to worry about competition from others charging less. And when some raise prices, all of them do—taking their leads from each other. It’s monopoly capitalism, pure and simple.

They have even bragged about this to their shareholders in their quarterly reports. Kroger CFO Gary Millerchip said in October, "We’ve been very comfortable with our ability to pass on the increases that we’ve seen at this point. And we would expect that to continue to be the case." Colgate-Palmolive CEO Noel Wallace said, "What we are very good at is pricing. Whether it’s foreign exchange inflation or raw and packing material inflation, we have found ways over time to recover that in our margin line."

These vultures are very pleased with their ability to use a crisis to squeeze even more money from working class consumers who can ill afford to pay.