Inflation, Price Gouging and Profiteering — The Real Reason Republicans Want Smaller Government

by | Feb 18, 2022 | Money and Politics, Opinions, Wealth Gap

Photo by Scanrail, iStockphoto

Inflation, Price Gouging and Profiteering — The Real Reason Republicans Want Smaller Government

by | Feb 18, 2022 | Money and Politics, Opinions, Wealth Gap

Photo by Scanrail, iStockphoto
Prices are going up everywhere. Corporations say it is "inflation" and want smaller government and lower taxes as "solutions." The reality is very different.

There has been a trend, accelerating since the time of Nixon and then Reagan, where the emphasis of Republican messaging is all about “smaller government.” The rhetoric stresses how government is large, bloated and utterly inefficient and is therefore getting in the way of “everyone’s” prosperity. This sales pitch has been so successful that many people think it is true.

In fact, it is not even close to being true. The real complaint of the financial backers of Republican and Libertarian politicians is that government regulations are designed to prevent rampant price gouging and profiteering. How well these interest have sold this lie is manifested daily in the increase in prices we pay at the pump for gas, for groceries and especially medical care and medicines.

For decades we have seen trends of corporate consolidation, removing competition from the playing field simply by taking ownership of the competition. Then, since there is less competition, prices start creeping up. Enter the regulators whose job is to push back on this competition with laws like the Sherman Antitrust Act of 1894, which is still in force. However under various Republican administrations the Federal Trade Commission, tasked with enforcing fair trade laws, has been curtailed or outright sabotaged—especially under Trump.

To listen to anti-regulation propaganda from mega corporations one would think that our nation was run by specially recruited morons and designed to mess up everyone’s lives. On the contrary, agencies like the Consumer Finance Protection Bureau—designed to stop predatory financial practices, the Environmental Protection Agency—paradoxically enacted under Nixon, the CDC, the FTC, the FCC, the FDA, Health and Human Services, all have a duty to protect consumers from rapacious activities by big business entities. But these legal functions of government were targeted by previous administrations for corruption, sabotage or outright destruction to curtail their activities.

“Smaller government,” to big corporate entities like oil companies, pharma, Koch industries, etc., means few eyeballs to observe and then rein in their activities.

The function of government regulation of business was made a reality under Franklin Roosevelt, earning him the undying hatred of big business. But the result was the largest economic boom in history, all because the emphasis was placed on people not business. Big business of course either failed to recognize or outright ignored this factor.

The push to dismantle the regulatory and oversight functions of the government—a multi-decade operation—have been so effective that drug companies have felt safe enough from regulation to radically inflate prices. Monopolization has been occurring in sectors like food and energy production that price inflation has been accelerating. Blame is placed on “supply chains” and Covid-19, but this is easily seen as false data when compared to record profits by the players in these sectors. Healthcare and pharma may be the worst since their price gouging amounts to “your money or your life.”

Remedy

So what can be done about this? The first step is actually enforcing the laws on the books, Sherman Antitrust being the leader of the pack. In some cases, RICO (Racketeering Influenced and Corrupt Organizations laws) may also need to be applied.

President Biden signed an executive order last July pushing for increased actions to foster competition. Nice idea, but so far ineffective.

Government entities, the agencies listed above, others and the White House, need to up their PR game. Responsible regulatory agencies have allowed themselves to be mercilessly branded as “deep state” conspiracies rather than groups upholding duties of public trust.

You cannot fight black propaganda by ignoring it, taking the “high road” or assuming that your good works will “speak for themselves.” Good works, unless they are well and competently publicized, are mute. Failing to expose the lies of those attacking you is fatal and that is the error currently being made.

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