Addressing Corporate Profiteering: Urgent Action Needed on Inflation

Recent data from the Groundwork Collaborative reveals a concerning trend: corporate profits have been a significant driver of recent inflation, accounting for 53% of inflation in the last two quarters, compared to 11% in the 40 years prior to the pandemic. Despite decreased costs, corporations have been slow to pass on savings to consumers, with consumer prices rising by 3.4% while producer input costs increased by only 1%. This suggests a pattern of corporate profiteering, with corporations exploiting cost shocks and coordinating price hikes. It is crucial to address this issue through stronger policies and government intervention in pricing. The expiration of the Trump corporate tax cuts in 2025 presents an opportunity to curb corporate profiteering through the tax code. Therefore, it is requested to consider this data when formulating future economic policies.