The Real Reason Your Grocery Bill Is Still So High

Yves here. Readers like to criticize Sonali Kolhatkar for being disengaged from real world issues, but here she focuses on a major pocketbook issue: the cost of food in the US. It takes a while for her to work up to the underlying cause, which is oligopolistic price squeezing by big corporate middlemen. Is there similar grocery price gouging in European countries?

By Sonali Kolhatkar, an award-winning multimedia journalist. She is the founder, host, and executive producer of “Rising Up With Sonali,” a weekly television and radio show that airs on Free Speech TV and Pacifica stations. Her most recent book is Rising Up: The Power of Narrative in Pursuing Racial Justice (City Lights Books, 2023). She is a writing fellow for the Economy for All project at the Independent Media Institute and the racial justice and civil liberties editor at Yes! Magazine. She serves as the co-director of the nonprofit solidarity organization the Afghan Women’s Mission and is a co-author of Bleeding Afghanistan. She also sits on the board of directors of Justice Action Center, an immigrant rights organization. Produced by Economy for All, a project of the Independent Media Institute

Americans have had to weather much in the years since the COVID-19 pandemic first began, including price inflation of basic necessities. Grocery bills, especially, are a drain on household finances. But, as recent reports show, inflation is easing across many industries, and yet food prices overall have remained stubbornly high. Not only is that an indication of a deep rot at the heart of the food industry, agribusinesses, and corporate grocery chains, but it is also a clear sign that we need to repair our entire food system.

Reporting on a new Census Bureau survey, USA Today’s Sara Chernikoff found that “[t]he average American household spends more than $1,000 per month on groceries.” And, while it’s not surprising that those residing in expensive states like California have high grocery bills, there’s little relief for those living in states with lower costs of living. An average California family’s weekly grocery bill is $297.72, but an average North Carolina family’s bill is $266.23—nearly as high.

Attempting to downplay this reality, Paul Donovan, chief economist of UBS Global Wealth Management, wrote in an op-ed in the New York Times that Americans might be overestimating how serious inflation is, feeling the pinch most especially when they buy something as small as a candy bar. “[C]onsumers perceive inflation as higher than it actually is,” wrote Donovan. Further, he claimed, “[h]umans are genetically programmed to emphasize bad news over good news when they make decisions.” Donovan is implying that we’re just imagining high grocery bills.

In fact, inflation in the grocery industry has been higher than in other industries, rising 25 percent over the past four years compared to 19 percent overall, and many have pointed to simple greed as the reason: food prices are high because the companies setting prices think they can get away with padding their profits. Since we all have to eat, naturally this hits lower-income families harder, rather like a regressive tax. A new report by the Groundwork Collaborative found that in 2022, “consumers in the bottom quintile of the income spectrum spent 25 percent of their income on groceries, while those in the highest quintile spent under 3.5 percent.”

Economists have attempted to explain the reasons for grocery-related inflation remaining stubbornly high by pointing fingers at supply chain issues, higher labor costs, and agricultural pests. The Washington Post even admitted—albeit with little additional comment—that “consolidation in the industry gives large chains the ability to keep prices high.” (I’ll return to this critical point below.)

Fearing that voters feeling the pinch every time they shop for food will punish him at the ballot box, President Joe Biden has taken aim at the food industry. At an event in South Carolina on January 27, 2024, the president remarked that, while “inflation is coming down… there are still too many corporations in America ripping people off: price gouging, junk fees, greedflation, shrinkflation.”

To be fair, some foods did become cheaper, such as eggs. Remember the nationwide scramble on eggs in the early months of the pandemic with many grocery retailers limiting the number of cartons per customer? But in the years since, prices leveled off. And then they whisked up again. In fact, eggs are a far better indicator of why Americans are upset about food-related inflation than a Snickers bar.

There are plenty of short-term interventions that government can apply to help American families cope with the high cost of groceries, and President Biden has implemented many of them. Groundwork Collaborative’s report cites an increase in Supplemental Nutrition Assistance Program (SNAP) benefits for the lowest-income Americans, as well as the federal government’s initiative in taking food corporations to court over price gouging, and helping to lower the prices of crop fertilizers.

But many of these fixes are workarounds to compensate for the massive monopolistic corporatization of our food industry. Recall the point that the Washington Post made with little additional analysis: “consolidation in the industry gives large chains the ability to keep prices high.” The fact is that only a handful of corporations control the majority of our food system. We are all at the mercy of a small number of big companies. And, unless we make serious systemic changes to our food systems, we will remain so.

When thinking about longer-term fixes that free our foods from corporate profiteering, the humble egg is once more a good example. When eggs were prized items during the early months of the pandemic, small producers and farmers markets became the only reliable suppliers for many Americans. I recall being even more grateful than usual for my membership with the Urban Homestead, a small farm in the heart of Pasadena, California, where I live. Each week, I place an order with them for fresh produce and other locally grown foods to supplement my store-bought groceries. During the COVID-19 lockdowns, Urban Homestead was one of the few sources my family had for eggs and fresh produce.

But such small producers are few and far between. While the lucky ones among us may have access to urban farms, there are simply not enough small-scale growers to feed most Americans. Those farms that do exist operate on razor-thin margins, struggling year after year to remain financially viable. They remain on the outskirts of a massive capitalist playing field that is tilted toward profit-centered, highly subsidized agribusinesses and grocery chains. While small farmers, both urban and rural, are struggling, food trading companies are gobbling up massive profits. And the federal government’s farm subsidy program disproportionately benefits large corporate growers rather than the family farmers they are ostensibly aimed at.

Localizing our food supplies and shortening the chain between food buyers (i.e., all of us) and grocery suppliers ought to be the focus of food-centered government policies. This requires adopting a mindset based on the idea of “food justice,” a topic on which much has been written. We need to make it easier for small-scale farmers to grow food while remaining financially stable, and harder for large-scale corporate agribusinesses to control our food supply. This requires incentivizing small-scale farmers to remain small and sustainable—the opposite of the “growth” ideals of corporate profiteers.

Lawmakers and corporate media outlets are so attached to the idea that food producers and distributors deserve massive profits in exchange for controlling our food supply, that a justice-based approach of de-growth rarely enters their discourse. Rather than the rich eating us (and our wallets), it’s time for us to eat the rich.

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  1. The Rev Kev

    ‘In fact, eggs are a far better indicator of why Americans are upset about food-related inflation than a Snickers bar.’

    Not just America but Russia as well. The government there came under heavy pressure due to the rising cost of eggs (nearly 60% in the second half of 2023) and even Putin was called out on this in public. So for the first half of this year eggs will be duty free to import in order to boost supply. ‘The authorities attributed the spike to an increase in demand for affordable protein and insufficient production volumes. Retailers blamed the price rise on producers, while industry experts noted that the problem stems from a range of factors, from overall inflation to bird flu, as well as growing demand prior to the holiday season.’

    But for the US the picture may be more complicated. In 2021 the US imported $78.6M in eggs from Canada, the UK, the Netherlands, China and France. But at the same time the US exported $596 in eggs to Mexico, Canada, South Korea, Hong Kong and Jamaica. So perhaps in part the problem is that too many were being exported which drove up local demand – and costs – in spite of those imports.

    1. SocalJimObjects

      Egg prices have more than doubled here in Taiwan since 2021, from NT$ 23.5 to around NT $55. At one time people were hoarding eggs like toilet paper, but I have not seen people queuing for eggs for quite some time.

    2. Gregorio

      At least with eggs, they can’t mask the actual price increase by reducing the quantity of the product while keeping the packaging the same, like they’re doing with many products on the supermarket shelves

      1. Neutrino

        Quality varies, too. The farmers market eggs bought directly from a producer who can look you in the eye and discuss the feed and conditions taste better than the factory farm eggs. Try them in a cook-off and observe how the yolks look and taste, as one example. Another one is to compare the standard American and European eggs.

        Here is to hoping that Lina Khan and others can help mitigate the food industrial complex concentrations, while not forgetting about big media.

        1. The Rev Kev

          I read a story a few short years ago talking about the corporations that had control of eggs in the US. So one effect was that unsold eggs were sent back to the factory to be mixed in with newer eggs before going out again to be sold. But of course an egg might make a second trip back to that factory so by the time some buyer cracked it open, it was as rotten as and the person would be wondering why.

      2. marieann

        Actually they can….the size large eggs we have where I live in Canada are actually small to medium…to the point where the recipe calls for a large egg I will use 2 of my “large” eggs

  2. Valerie in Australia

    I buy my eggs off of a little boy in my neighbourhood, so I can’t speak to the price going up and down in the big grocery chains where I live However, I have noticed that many of the groceries I bought two years ago have even doubled in price in my part of Australia – almost all are at least a third more expensive. To cope with the rising cost of food, we have cut out almost all the the processed foods and tend to buy produce in season – which is healthier in the long run – and I am boycotting (BDS) pretty much every major food corporation – so that helps too. It would be good, actually, if we went back to more locally grown and produced food (IMHO) but filling the trolley with chips, crackers and soft drinks seems to be a habit few want to give up. I think a lot of it is just being too tired to cook and prepare food properly as a result of stressful lives. I grew up with a Grandma who did all the cooking in our house – from scratch. She spent HOURS in the kitchen but she sure knew how to stretch a food dollar. Until I retired seven months ago, that was just a luxury I had to forgo. I do feel really sorry for people on a tight budget, though. And the Coles and Woolworths – the two main grocery chains in Australia – have taken a lot of criticism for price gouging – which is why I am turning to smaller grocery stores when I can.

  3. Bugs

    Egg prices in France have gone up about 13%/year during the past two years. I honestly haven’t noticed a big price increase in anything in particular but overall prices are higher about 10% year on year. Now used car prices, those are nuts. Thing is if you have one to sell, it won’t make much difference.

    I’m in India right now and there are complaints about onion prices.

  4. Cristobal

    Recently visited family in the US and was horrified by the prices of nearly everything, especially groceries. I think the situation in Europe depends on whether you live in a rural area or in the city. Here in Spain, the TV news reports regularly on the high prices in the supermarkets, but there seems to be more competition than in the US which may help some. Where I live, in a small agricultural town, it is not so bad. I believe that a big factor is that most Spanish towns have what is known as a mercadillo once a week. The local government establishes a site, and a day, which varies from town to town. The event consists of dozens – maybe a hundred – of sellers rolling up in their big vans and setting up their stands. Nearly everything can be found: lots of clothing for men, women and children of all ages, baked goods, bolts of fabric, shoes, furniture sometimes, olives, nuts and dried fruits, and at least three or four big fruit and vegetable sellers. The prices are low, the product is fresh, and they have a great selection. A guy usually shows up at ours selling almejas and little shrimps (camarones – probably illegaly acquired) but I have never seen meat for sale other than the local types of sausages. The event is well attended.

    The US farmers markets I have seen are a pale imitation, To attract people it needs to be a collective effort. Too, Spain produces a lot of vegetables and fruits. Something is in season nearly year round. The country is small enough for the products from one area to be easily accessible to most of the others. In the US not so much. Once upon a time fruits and vegetables for local consumption were grown there. New Jersey is known as the Garden State for a reason. It was for many years the source of vegetables (and eggs!) for New York and Philadelphia. Industrial agriculture – mass quantities of export crops – has taken over. Food for people to actually eat is likewise an industrial produce and is imported from around the world. Not only the distribution system, but the agricultural production system in the US – and the world actually – is in need of some major adjustments.

    1. mrsyk

      The US is a big country. Believe it or not, there are some good farmers markets to be found. Also, mercadillo = flea markets here.

  5. i just don't like the gravy

    My eggs are free they come from my hens who I feed and care for and protect from coyotes

    We have a symbiotic relationship. They sustain me with omelettes and I maintain their firm grip on the means of production

    The proletariat must become a chick magnet!

  6. Mirko

    A good indicator for Germany is noodles and toilet paper! Because what can a German do in a crisis, eat noodles and go to the toilet …

  7. Carla

    Another real reason US food is so profitable is in today’s links:

    Headline: Prisoners in the US are part of a hidden workforce linked to hundreds of popular food brands

    First sentence: “A hidden path to America’s dinner tables begins here, at an unlikely source – a former Southern slave plantation that is now the country’s largest maximum-security prison.”

    Louisiana State Penitentiary, known as Angola, has 6,300 prisoners and 1,800 staff according to Wikipedia. Could it actually be the largest maximum security prison in the world?

    1. Neutrino

      That article was quite illuminating for many reasons. Here are a few. It put human faces to names or what is so often in other articles just brief anonymous descriptions. The longer form investigative journalism seems quaint in these days of clickbait and sound bites, but there is still an audience!

      The sheer waste of human lives comes through, as does the barbarity and rationalization that seem to be endemic to the, uh, evolving prison system and its, quelle surprise, enablers.

      A quick search about the identity of that Angola former owner turned up Isaac Franklin. After reading about him it is time for a shower.

    2. Carla

      Scant mention of prison privatization per se in this AP story, as if it’s so normal and routine as to be barely worthy of notice. But here are a few examples:

      “A separate federal investigation into graft at the for-profit arm of Louisiana’s correctional department led to the jailing of two employees.”


      “Jack Strain, a former longtime sheriff in the state’s St. Tammany Parish, pleaded guilty in 2021 in a scheme involving the privatization of a work-release program in which nearly $1.4 million was taken in and steered to Strain, close associates and family members. He was sentenced to 10 years in prison, which came on top of four consecutive life sentences for a broader sex scandal linked to that same program.”

      “Slavery has not been abolished,” said Curtis Davis, who spent more than 25 years at the penitentiary and is now fighting to change state laws that allow for forced labor in prisons.”

      Indeed, slavery is alive and well in USA! USA!

  8. john r fiore

    Until the late 1970’s the US government had a “cost of living council”, which supervised the market to make sure prices didnt get out of control…and if they did, the government would put a freeze on the prices and work on getting it back down….Such rational thinking is long gone as the government has been taken over…

  9. lyman alpha blob

    A few years back we joined some vegetable and meat shares, where you pay a set price ahead of time which allows the farmers to know what to produce, and then you get the food later. My better half does most of the grocery shopping these days and the meat share seemed a little pricy to me – I think ours was about $9.50/lb on average for a mix of various cuts of beef, pork and chicken. But then I went to the grocery store myself and suddenly $9.50 was a much better deal. It might be high for breakfast sausage, but it’s a steal for porterhouse steak, both of which are included in the share.

    I would highly recommend doing one of these shares if available near you. It really isn’t much more than what you pay in a grocery store and the quality of the food is noticeably better. With inflation and the unsteadiness of the supply chain, it’s wise to support your local farmers. And if they throw in something you’ve never heard of before that looks a little sketchy and you don’t know what to do with, you can always get ideas from a good cookbook. We’ve come to find some good recipes for celeriac root and other oddities. One I’d recommend is David Tanis’ Market Cooking – simple and tasty recipes for foods you might find at a farmer’s market our in your vegetable or meat share.

    1. Neutrino

      My daughter and her family have been in a similar program and they love the offerings of fresh produce and various proteins from people local to her area. Keep it in the community where possible, a time-honored approach.

  10. Tom Pfotzer

    The food business in the U.S. has been consolidated into the hands of a relative few, and the supply chains tend to be national,. which offers lots of opportunity for rent-seeking.

    National supply chains imply a lot of transportation. A good bit of our food has fertilizer, seed, and fuel as major inputs, and those inputs have been also been consolidated into the hands of a relative few.

    And we’ve had a lot of inflation, and of course that’s going to show up in food prices.

    Moving to local agriculture cuts out some of those rent-seeking opportunities, but the local producers don’t currently – and may never achieve – the scale efficiencies of the big guys.

    But that’s not the whole story. Local producers _could_ – and sometimes actually do – have operational processes which bypass / eliminate some of the marketing costs the big guys face, like transportation, warehousing, brokering, processing, and packaging. Farmers’ markets are the obvious example, there are many others, like producers’ co-ops, and CSAs (see Lyman Alpha Blob’s comment above).

    To date, the local operators haven’t fully exploited the advantages of local-ness, and that’s what’s keeping the local food market in check. At the moment.

    There is great potential for developing advanced local storage, processing, distribution, retailing, and promotion systems which will help deliver on the promise of local .vs. the big guys.

    Until the local food systems develop further, the big guys will continue to extract extra rent, so it’s likely that food prices will continue to rise.

    Recall that the bulk of food costs aren’t from the cost of production; they’re from the so-called “marketing” functions, like processing, transport, packaging, retailing and promotion.

    Here’s a report from USDA that says the production costs – what the farmer actually gets – is about 14% of the final grocery-store price.

    Here’s another set of USDA reports that breaks down the production .vs. marketing costs by commodity.

    And one more, from Purdue University, (major U.S. ag school, located at the heart of U.S. grain and pork production) shows a table of key farm inputs (seed, fertilizer, fuel) costs and their relative changes over the past decade.

    Scroll down a little to find the table.

    1. Carla

      TP says: “Recall that the bulk of food costs aren’t from the cost of production; they’re from the so-called “marketing” functions, like processing, transport, packaging, retailing and promotion.”

      Right. They particularly aren’t from the cost of production when production and even processing and retailing are being performed by free or almost free prison (slave) labor. I would posit that the bulk of food costs are from profit-taking at the very tippy-top. Class warfare par excellence!

    2. steppenwolf fetchit

      How high would locally grown food prices have to be for local growers ( small farmers) to make an actual secure living at small farming? If people are prepared to pay a fair-wage price for local food, then local farmers will be able to make a fair-wage living. If people are not prepared to pay a fair-wage price for local food, then local small farmers will keep struggling on razor thin margins and the “parallel local food system” will never get big enough or strong enough to challenge the corporate mainstream.

      I can afford to pay the “local food” price for food . . . at the co-op, at the farmers market, etc. And so I do.

      Every dollar is a bullet on the field of economic combat.

  11. Wukchumni

    I remember a day in the early 70’s when candy bars went from a Nickel to a Dime in price, maybe my first inflationary instance.

    U.S. stamps were also a Nickel back in the day, now @ 66 Cents.

    A Hershey’s milk chocolate bar with almonds, where the only thing they didn’t cheap out on was almond slivers, probably because they couldn’t find an ersatz replacement, is now $1.79, and is about 1/2 the size of the Nickel version of my youth.

      1. Wukchumni

        The few candymakers of size are essentially a monopoly, selling stuff named in the 1920’s or 30’s.

        ‘100 Grand Bar’ may be the MSRP eventually.

  12. CA

    August 8, 2023

    Why Are Groceries So Expensive?
    There’s no one simple cause for higher food prices
    By Paul Krugman

    Sometimes I talk about inflation with real people — no, not Trump supporters in diners, but people who don’t pore over Bureau of Labor Statistics reports or argue about the relative merits of trimmed mean versus multivariate core trend inflation. And while people don’t necessarily disagree with the proposition that inflation is coming down, they do inevitably bring up the cost of groceries.

    It’s a fair point. Yes, there’s a negativity bias in perceptions of food inflation, in which big jumps make a stronger impression than big declines. For example, the Eggpocalypse of 2022 got a lot more attention than the rapid normalization of 2023:

    Still, it’s true that grocery prices have risen considerably more than average consumer prices since the eve of the pandemic:

    Why? Can we blame Bidenomics? Or are surging food prices an example of “greedflation,” inflation caused by price gouging?

    No and no….

    1. ISL

      I could be wrong, but I do not think Krugman belongs to the class that actually goes grocery shopping. Or cares about the cost inflation of their “basket of goods.” I do know he cares about the well being of the DNC, and by extension the 0.00001% (and the PMC until they are replaced by AI).

  13. jo6pac

    I was going to shop today but now I’m depressed about something I knew about but hide in the little corner of my brain;-) I’ll go Monday and I need gas:-(

    The rain is about 4 hrs away from me in Calli. I think I’ll go outside while I can.

  14. Mark Gisleson

    Saw on Twitter earlier that Amy Klobuchar has introduced a bill to clamp down on using AI to manipulate food prices. That should fix everything, problem solved.

  15. Fred

    I’m going to sort of defend Paul Donovan’s comment. We mostly go by feel when it comes to complicated manners of economics. A 12 pack of beer and a 2 lb bag of coffee costs me US50. Back when America was great I could get a tank of gas, a bag of chips and some beer and still get change from my $20 bill. Of course it’s not a fair comparison, but I’m too lazy to give it much thought.

  16. Carolinian

    Food companies may be more consolidated but for some of us grocery retail has become more diverse with discount but still quality grocers like Aldi and Lidl and, yes, Walmart–now the US grocery bigfoot. However given that things like cereal probably still come out of food conglomerate factories the prices are up by the same percentage but the marketing markup at least removed. Meanwhile at Aldi non factory products like bags of potatoes or onions sell for nearly the same price as pre Covid.

    Which is to say if the processed food industry gets too out of control the public may switch back to more raw food and become healthier as well–a glass half full analysis.

    1. Bazarov

      Aldi produce is garbage–I’ve never had food rot so fast. My gaze alone seems to wilt, sprout, moulder, and bruise its tender flesh. You get what you pay for.

      Walmart’s is better overall, though their fruit is dodgy. 3 out 5 peaches from there never ripen. They remain hard as rocks and sort of just wrinkle over a week or two rather than decay into mush like their normal brethren. It’s kind of fascinating.

      1. Carolinian

        With our German industries we’ve had an Aldi for many years. I’d say the produce has improved but certainly not their strong suit.

        On the other hand many of their store brand products are very good. I think with any grocery you learn what to buy and what not. I don’t shop at just one store but others may find that time consuming.

  17. Oldtimer

    Interesting and it might be one of the factors, but did big companies and middle men became greedy post covid only?
    It doesn’t explain why there wasn’t such price increases before the pandemic.

    1. eg

      Isabella Weber has done a lot of work on this question if you can be ersed to look for it — she calls it “price setter’s inflation.”

      1. Socal Rhino

        Yes. She prefers sellers inflation to “greedflation” because sellers are always greedy. Price shocks provide cover for increases that would have been rejected. Common sense but she “has the receipts.” She’s at Amherst.

  18. gwb

    It’s been fairly well documented that our modern food system requires ten calories of fossil fuels for every calorie of food delivered. The costs of extracting oil, gas and coal have been relentlessly rising as we have to turn to lower-quality sources – this will all be reflected in grocery-store prices.

  19. Wukchumni

    Kudos to the Bakersfield Californian by not having a paywall, and often coming up with really interesting stories…

    A markdown of almost $2.3 million on 1,134 acres of farmland for sale southwest of Wasco is the latest sign of how acute the buyer’s market for ag property has become amid continuing water challenges, elevated interest rates and slumping commodity prices.

    After peaking in 2015, largely on the strength of what were then high almond prices, ag property valuations have fallen precipitously in the last two years. Local farmland brokers say that although sharply lower almond prices have contributed to the downward price trend, a bigger factor has been a state law limiting groundwater pumping.

    Ming said ag economists he has spoken with agree prices might not bottom out until the fourth quarter of this year or the first quarter of next. He added there’s now more farmland listed for sale locally than he has seen in many years, with many sellers but “very, very few buyers.”

    Prices of food in the supermarket are way up, the land to grown food on, way down.

    1. CA

      “Prices of food in the supermarket are way up, the land to grown food on, way down.”

      Interestingly and importantly, prices of food in China are relatively low and have not been rising.  “Land to grown food on” has been increasing in China.  Also, China has been dramatically increasing water conservancy.

      1. Wukchumni

        To be fair, the stupidity in overgrowing almonds had to be seen to be believed. There are 300 million trees in Cali producing now with 100 million more to come of nut bearing age.

        1. JBird4049

          four hundred million almond trees? Aren’t these water hogs mostly grown in dry areas, which means sucking up the ground water?

          1. Kat

            Did someone say Resnicks? The Beverly Hills ‘farmers’?

            What a strange coincidence that they are huge donors to the Democratic supermajority in Sacramento.
            Also the first, and probably only segment of high speed rail fail, to be built in the Central Valley, is around their land upon which they have “agricultural water rights.”

            Almond and pistachio trees today, ticky tacky stucco subdivisions tomorrow.

      2. steppenwolf fetchit

        How has China been increasing its amount of ” land to grow food on” ? What was that land doing till recently before it was growing food?

    2. CA,924,132,134,534,536,158,186,112,111,&s=PCPIPCH,&sy=2007&ey=2023&ssm=0&scsm=1&scc=0&ssd=1&ssc=0&sic=0&sort=country&ds=.&br=1

      October 15, 2023

      Inflation Rate for Brazil, China, France, Germany, India, Indonesia, Japan, Turkey, United Kingdom and United States, 2007-2023


      Brazil ( 4.7)
      China ( 0.7)
      France ( 5.6)
      Germany ( 6.3)
      India ( 5.5)

      Indonesia ( 3.6)
      Japan ( 3.2)
      Turkey ( 51.2)
      United Kingdom ( 7.7)
      United States ( 4.1)

  20. Karl

    I recall a paper in early 2023 by Stiglitz saying about half the inflation in the U.S. (then) was due to U.S. sanctions on Russia (i.e. their impacts on supplies of oil, gas, fertilizer, food, etc.). Another big factor, according to Stiglitz, was supply chain bottlenecks. The inflationary pressures of major supply disruptions tend to take years to be fully absorbed globally, so sanctions and other supply related effects probably still play a lingering role in 2024.

    The resultant profits to U.S. fossil fuel, agricultural and other commodity producers haven’t brought much political upside for team Biden so far as I can see.

    The political downside of any attempt to remove U.S. sanctions, e.g. in the interests of peace, will be prohibitive. So, given how our political system works, these sanctions will be in place for many years. Who pays? The many who will lose their jobs, pay higher rents, etc. due to persistently high interest rates and rising prices.

  21. Kat

    Karl, No mentions in the article of Biden’s war sanctions cutting Americans off from:

    Russian wheat, which accounts for around 17% of the global supply.

    Together Russia and Ukraine exported 25.4% of the world’s wheat in 2019, according to the Observatory of Economic Complexity (OEC).

    And this: The U.S. imports approximately 96% of the nation’s potassium fertilizer from Russia, including 1 million short tons per year, according to Michigan Potash & Salt Company.

    In 2019, the U.S. imported roughly $299.4 million in phosphate fertilizer from Russia, making it a total of 729,288 metric tons, according to Progressive Farmer.

    In 2021, the U.S. imported $1.28 Billion of fertilizer from Russia, according to the United Nations COMTRADE database on international trade.

    Only a fool, a PMC Democrat, or someone with poor math skills would not make the connection between Biden’s policies and the cost of food.


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