By Natalia Marques
Peoples Dispatch spoke to economist Richard Wolff, who outlined that “prices are shaped by many factors, and only a few of those are under the control of any president.”
“Trump did what American politicians usually do, which is take a cheap shot at his political enemies by blaming them for something bad going on in this case, inflation,” Wolff said. Now that Trump is president, “he’s going to suffer from other politicians blaming him in exactly the way he blamed them,” for inflation.
Skyrocketing prices experienced by billions in the US includes a major egg shortage, with egg prices soaring and supplies shrinking as bird flu (H5N1) outbreaks continue worldwide. The US Department of Agriculture has predicted an egg price increase of 41% in 2025. In January, egg prices increased as much as 15%, to an all-time high of USD 4.95 for a dozen large Grade A eggs.
Not only are egg prices rising, but prices of many other staple food items have also gone up, including coffee, bread, and flour.
Rising food prices are but a part of the already existing crisis of the general rise in prices, or inflation, that people in the US are also experiencing, with inflation hitting a seven-month high of 3% in January. According to analysis by economic columnist Heather Long of The Washington Post, rent alone made up 30% of the increase.
Broken promises
In an August 2024 campaign speech, Trump promised to bring prices down “starting on Day 1.”
Trump was speaking directly to US voters’ primary concern. According to AP VoteCast, a survey of over 120,000 registered voters conducted from October 30 to November 5, 96% of these voters said “high prices for gas, groceries and other goods” factored into who they voted for—an election in which the Democratic Party lost the popular vote for the first time in 20 years.
Trump has attempted to pin the blame for inflation on his predecessor, Joe Biden. “BIDEN INFLATION UP!” Trump posted to Truth Social following the release of the inflation numbers.
This campaign promise, like many others, has proved more difficult to carry out than to agitate around.
Trump admin scrambles for inflation cure
The Trump administration is beginning to float new ideas around how to tackle the inflationary crisis. Unelected billionaire Elon Musk, who has been leading the charge on slashing through government spending and the federal workforce—leaving no stone left unturned including Social Security—has claimed that cutting federal spending could end all inflation.
“If you cut the budget deficit by a trillion between now and next year, there is no inflation,” Musk said during a February 11 press conference in the Oval Office, alongside Trump. “And if the government is not borrowing as much, it means that interest costs decline. So everyone’s mortgage, their car payment, their credit card bills, anything, their student debt, the monthly payments drop. That’s a fantastic scenario for the average American.”
According to Michael Linden, a senior policy fellow at the Washington Center for Equitable Growth, “that would be a roughly 4% of GDP cut to federal spending, all in one year.”
“It would be an instant recession,” he told the Associated Press.
Some of Trump’s key policies have in fact raised prices—the opposite of what he promised on the campaign trail. Trump’s upcoming tariffs on steel and aluminum imports, though only slated to start on March 12, have led to spikes in metal prices as suppliers anticipate the levies.
Pricing is class struggle
According to Richard Wolff, the bottom line is that “prices are set by a group of people known as employers, or if you like, capitalists: The people who own and operate enterprises, factories, offices, stores.” This tiny group of employers, who are vastly outnumbered by the population of employees, are motivated to set prices in order to extract the maximum amount of profit.
When it comes to delivering on promises to decrease prices, “the honest answer to why Mr. Trump hasn’t been able to do anything,” according to Wolff, “is that the opportunities for higher profits that are available to companies who raise their prices are still attractive enough that they’re doing it. That’s it.”
According to Wolff, “Pricing is a part of class struggle in our society, because it’s the employer class that has the power to determine the standard of living.”.
This article originally appeared in Peoples Dispatch on February 26th, 2025
No comments:
Post a Comment