In response to growing evidence of corporate profiteering and price gouging, the American Economic Liberties Project and the Groundwork Collaborative released a letter to the Biden Administration calling on the White House to take immediate action.
The letter urges President Biden to speak out against rampant corporate profiteering, to convene an emergency meeting of the White House Competition Council, and to encourage the Council of Economic Advisors to study market structure and corporate behavior in concentrated industries more rigorously.
“Corporations are all too happy to blame working families and the Biden administration for inflation when it’s clear it’s corporate power that’s the problem,” said Sarah Miller, executive director of the American Economic Liberties Project. “It’s time for President Biden to place blame where it belongs, with price gouging monopoly CEOs who are exploiting real economic challenges to rip off the American people.”
There is substantial evidence that severe corporate concentration is meaningfully contributing to inflation. As law professor and former FTC attorney Robert Lande has noted, “with supply-chain bottlenecks and shortages as cover, many companies can finally take advantage of their years of consolidation and collude more easily with less chance of it being detected.” Though President Biden has acknowledged the tremendous “stress” American families are experiencing and has promised to use “every tool at [his] disposal to fight inflation,” he has not tasked the White House Competition Council nor the Council of Economic Advisors with investigating the market power issues at play.
“Earnings calls are littered with CEOs bragging about how they’re using inflation as a cover for their price hikes – all while reporting record profit margins and issuing millions in buybacks,” said Rakeen Mabud, chief economist and managing director of policy and research at Groundwork. “Without immediate intervention by the Biden Administration, mega-corporations will continue to take advantage of consumers, workers, and small businesses without consequence. The President must act.”
In the letter, Economic Liberties and the Groundwork Collaborative highlight data that shows corporations are reporting the biggest profits margins in 70 years. The letter urges President Biden to convene the Competition Council to coordinate a government-wide response, and order the Council of Economic Advisors to study market realities by answering the following questions:
Read the full letter to the White House here.