He sure knows how to sum things up.
More recently, mainstream U.S. politicians—again, establishment figures from both major parties—applied the denial and displacement mantra to the problem of inflation in the U.S. economy. The denial with which they confronted inflation was oddly focused on the future. Americans were officially assured that the inflation would be limited in extent and would be merely transitory. Its possible depth and duration were denied. Federal Reserve Chair Jerome Powell and others down the bureaucratic ladders confidently predicted inflation’s future decline. When the lack of evidence behind such denials about possible future decline in inflation became clear when the real inflation data were announced, attempts at displacements by politicians and bureaucrats grabbed the limelight. The no longer deniable inflation was dutifully blamed on supply chain disruptions, Federal Reserve monetary policy, the Democrats’ fiscal policies, the Chinese, Trump, or Biden.
Yet again, virtually nowhere did politicians or media commentators refer to capitalism’s role in causing this inflation. As every business school teaches its students and as capitalists have repeatedly admitted, profit is the bottom line, the goal of business decisions. One such decision is setting prices to maximize profits. After nearly two years (2020 and 2021) of a depressed profit situation for most businesses, employers across the U.S. wanted to recoup their lost profits. They hoped to do so by raising their prices as much as the market could bear. In capitalism, employers (a tiny minority of the population) exclude employees (the vast majority) from making price decisions. Especially in the latter half of 2021, many employers raised prices of their goods and services. They thereby caused an inflation to improve their profit situation: what they are in business for. For the employees, who are in the majority and were already hurt badly during the two years of the ongoing pandemic plus the 2008 economic crash, an inflation, especially one outrunning their wage increases, was unspeakably bad news.
Denial and displacement indeed.
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