If you were to believe the fear mongering ads from Republicans and their affiliated dark money PACs, you would think that the U.S. economy is in a Great Depression with masses of unemployed and long bread lines.
The exact opposite is true. Jeff Cox reports for NBC, U.S. economy added 261,000 jobs in October, better than expected as hiring remains strong:
Job growth was stronger than expected in October despite Federal Reserve interest rate increases aimed at slowing what is still a strong labor market.
Nonfarm payrolls grew by 261,000 for the month of October while the unemployment rate moved sightly higher to 3.7%, the Labor Department reported Friday.
Those payroll numbers were better than the Dow Jones estimate for 205,000 more jobs but worse than the 3.5% estimate for the unemployment rate.
Note: The Federal Reserve is increasing interest rates designed to decrease demand by increasing unemployment to cool inflation, using outdated old school economic tools in a post-pandemic economy. The small uptick in unemployment would be a good thing in the eyes of the Federal Reserve, unless it was because more people are coming off the sidelines to look for work.
The Federal Reserve does not have any authority or the tools to deal with what is actually driving inflation, corporate greed and price gouging. Only Congress can address this problem, and it has yet to do so. MSNBC’s Chris Hayes covered this last week with Congresswoman Katie Porter to discuss how corporations are hiking prices and generating record profits—all under the cover of “inflation.”
In the last 2 quarters, Big Oil raked up more than $100 billion in profit, more than all of last year.
Americans are getting fleeced and when @HouseDemocrats acted to stop the price gouging, every Republican in Congress voted no.
They will always side with profits, not people.
— Ruben Gallego (@RepRubenGallego) November 1, 2022
Oil companies have already posted $127 billion in profit this year versus $42 billion over the same period last year.
Folks, inflation isn’t being driven by workers asking for better wages or government spending. It’s being driven by corporate greed.
— Robert Reich (@RBReich) November 6, 2022
Average hourly earnings grew 4.7% from a year ago and 0.4% for the month, indicating that wage growth is still likely to pressure inflation. [More outdated old school economic thinking.] The yearly growth met expectations while the monthly gain was slightly ahead of the 0.3% estimate.
The new figures come as the Fed is on a campaign to bring down inflation running at an annual rate of 8.2%, according to one government gauge. Earlier this week, the central bank approved its fourth consecutive 0.75 percentage point interest rate increase, taking benchmark borrowing rates to a range of 3.75%-4%.
Those hikes are aimed in part at cooling a labor market where there are still nearly two jobs for every available unemployed worker [a labor shortage and under utilized capacity.] Even with the reduced pace, job growth has been well ahead of its pre-pandemic level, in which monthly payroll growth averaged 164,000 in 2019.
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Fed Chairman Jerome Powell on Wednesday characterized the labor market as “overheated” and said the current pace of wage gains is “well above” what would be consistent with the central bank’s 2% inflation target. [Wedded to outdated old school economic thinking. This SOB is going to cause a recession and unemployment.]
“Demand is still strong,” said Amy Glaser, senior vice president of business operations at Adecco, a staffing and recruiting firm. “Everyone is anticipating at some point that we’ll start to see a shift in demand. But so far we’re continuing to see the labor market defying the law of supply and demand.”
Glaser said demand is especially strong in warehousing, retail and hospitality, the sector hardest hit by the pandemic.
Jim Hightower explains, CEOs Are Literally Bragging About Raising Prices:
Today, CEOs of big corporations are playing the tricky “Inflation Blame Game.”
Publicly, they moan that the pandemic is slamming their poor corporations with factory shutdowns, supply chain delays, wage hikes, and other increased costs. But inside their boardrooms, executives are high fiving each other and pocketing bonuses.
What’s going on? The trick is that these giants are in non-competitive markets operating as monopolies, so they can set prices, mug you and me, and scamper away with record profits.
In 2019 for example, before the pandemic, corporate behemoths hauled in roughly a trillion dollars in profit. In 2021, during the pandemic, they grabbed more than $1.7 trillion. This huge profit jump accounts for 60 percent of the inflation now slapping U.S. families!
Take supermarket goliath Kroger. Its CEO gloated last summer that “a little bit of inflation is always good in our business,” adding that “we’ve been very comfortable with our ability to pass on [price] increases” to consumers.
“Comfortable” indeed. Last year, Kroger used its monopoly pricing power to reap record profits. Then it spent $1.5 billion of those gains not to benefit consumers or workers, but to buy back its own stock — a scam that siphons profits to top executives and big shareholders.
Note: Kroger recently announced a merger bid with Albertsons/Safeway (a previous merger), which would increase its monopoly pricing power and further reduce competition (competitive pricing) in groceries. Why you should worry about the Kroger-Albertsons grocery store merger.
Or take McDonald’s. It bragged to its shareholders that despite the supply disruptions of the pandemic and higher costs for meat and labor, its top executives had used the chain’s monopoly power in 2021 to hike prices, thus increasing corporate profits by a stunning 59 percent over the previous year.
And the game goes on: “We’re going to have the best growth we’ve ever had this year,” Wall Street banking titan Jamie Dimon exulted at the start of 2022.
Hocus Pocus. This is how the rich get richer and inequality “happens.”
Robert Reich adds: Kudos to @Groundwork Collaborative for uncovering these CEO calls and helping spread the truth about how inflation has been corporate America’s “friend” because it gives them cover to raise prices.