That’s not how the economy works, Joe! Biden demands supermarkets cut soaring grocery prices that threaten his re-election – even though reasons for spikes are beyond stores’ control
Joe Biden has suggested that supermarkets must defy the laws of supply and demand to reduce the rising prices that threaten his re-election chances.
“There are still too many corporations in America ripping people off: price gouging, junk fees, greed, shrinking inflation,” he said during a speech in South Carolina last week.
“Americans, we’re tired of being played for jerks and that’s why we’re going to keep these guys – keep them going and get the prices down.”
White House aides told The New York Times that Biden is targeting supermarkets – and more to come.
A 16 percent increase in the cost of eggs, milk and other staples over the past two years has put pressure on many Americans who have complained they are struggling with the cost of living despite a strong overall economy.
But prices in supermarket aisles have been turbo-charged by inflation, rising demand and supply chain issues – none of which store bosses can control.
President Joe Biden is demanding that supermarkets lower their prices as confidence in his economic policies remains low ahead of his re-election campaign
While that’s an improvement, it still remains lower than Biden’s already low approval rating — 38 percent — in the same survey, with prices still too high and the president desperate for a fix before he faces voters in November.
It remains unclear what the grocery chains might do given the underlying factors, such as a bird flu-influenced rise in egg prices and price increases by manufacturers on things like soft drinks and candy.
The Federal Reserve Bank of Kansas City said last year that the tight labor market was also a contributor to the rising prices.
While Biden remains aware that prices are too high, he appears to have little recourse within America’s system other than to complain about them to the retailers, who themselves face higher profit margins.
Bharat Ramamurti, a progressive former economic aide to Biden, said the New York Times there is only so much short term Biden can do
“When you have something that is partly driven by supply disruptions, what can you actually do to put downward pressure on prices?” asked Ramamurti.
At a recent speech, it was clear that despite conditions such as inflation, supply chain disruptions and demand beyond their control, Biden is blaming retailers and demanding that they lower prices.
Inflation rose to 3.4 percent in December – above economists’ forecasts – raising fears that the Federal Reserve may hold off on raising interest rates this year
A manager of Kroger, one of America’s largest supermarket chains, believes that a solution can be found in this company’s impending merger with fellow chain Albertson’s.
“We agree with President Biden: too many grocers in America have increased margins in contrast to Kroger, which has consistently reduced our margins for nearly 20 years to save customers billions,” said Kroger VP of Corporate Affairs and Chief Sustainability Officer Keith Dailey .
‘Through our merger with Albertsons, Kroger will lower prices for even more of America’s consumers.’
However, the Times reports that the Federal Trade Commission is likely to block the merger, with skeptics believing it would reduce competition and allow for higher prices.
Despite the economic worries of a large majority of Americans — 65 percent still call the economy weak in a recent AP/NORC poll — the nation’s economy is growing at a faster pace than any other G7 nation, thanks in part to ‘ A post-pandemic productivity boom, experts say.
The IMF World Economic Outlook report estimates that the US economy grew by 2.5 percent in 2023 – and is poised for similar growth of 2.1 percent in 2024.
The findings lay bare the surprising resilience of the US in the face of red-hot inflation and rising interest rates. Multiple Wall Street economists predicted that this pressure would push America into recession by 2023.
The IMF report noted that households benefited from a rise in disposable income thanks to a strong labor market. Many were also supported by their accumulated savings from lockdown.
FILE – President Joe Biden speaks to members of the media before boarding Marine One on the South Lawn of the White House in Washington, January 30, 2024. American adults feel only slightly better about the economy, despite stocks near record highs and surprisingly strong growth last year. A new poll from The Associated Press-NORC Center for Public Affairs Research finds that 35% of American adults say the national economy is good. (AP Photo/Andrew Harnik, File)
What’s more, researchers say the pandemic has caused a swing in Americans shifting to higher productivity jobs.
It comes after interest rates hit a 22-year high in 2023 as the Federal Reserve sought to curb red-hot inflation.
In their forecasts for 2023, economists at Barclays Capital Inc. said it would go down as one of the worst ever for the global economy while Fidelity Investments labeled a US recession as ‘likely’.
But rampant consumer spending and a strong labor market have consistently surprised officials.
Yesterday, Fed Chairman Jerome Powell hinted at this when he confirmed that officials had voted to keep interest rates steady at their current level of between 5.25 and 5.5 percent.
Powell told reporters that economic data from the past six months had been “promising.”
However, he warned: ‘Inflation is still too high and the path to bring it down is not assured.’