According to the White House press secretary, rising meat prices result from increased profits in the meat industry.
Consumer prices were increasing at a 7% annual rate, as of December 2021, resulting in increased grocery bills and tighter finances for many average Americans.
Rather than blaming increased federal spending or lax monetary policy, Democrat politicians have blamed grocers and meat producers for seeking bigger profits.
Lack of Competition
On Tuesday afternoon, Psaki reiterated the same claims.
At her press briefing, Psaki stated, “four giant conglomerates dominate the chunk of the market for beef, pig, and poultry goods. The figures show that meat prices have increased, while the businesses have achieved recent record profits.”
Thanks to a softball from Bloomberg's Jordan Fabian, Jen Psaki reiterates that meat and poultry companies are the reason why we've seen such a skyrocketing rise in the price of beef, chicken, and pork at the grocery store. pic.twitter.com/pp8U9JoSQc
— Curtis Houck (@CurtisHouck) February 8, 2022
“If you look at previous precedent, ranchers received more than $0.60 for every dollar spent on cattle by a family 50 years ago. They earn approximately $0.39 today,” she continued.
“Fifty years ago, hog farmers earned between $0.40 and $0.60 for every dollar spent. Today, it is approximately $0.19 and the large corporations continue to earn substantial profits.”
“That is emphatically not how it should function,” Psaki said. “As the president stated numerous times, capitalism in the absence of competition is exploitation. Additionally, we continue to be concerned about these businesses’ lack of competition.”
Psaki’s comments echo those Senator Elizabeth Warren (D-MA) made, who asked Assistant Attorney General Jonathan Kanter to probe poultry corporations.
“The highly concentrated chicken business, in which the top four firms (Tyson Foods, Inc. (Tyson), Pilgrim’s Pride, Perdue, and Sanderson Farms) control more than half of the market, has suffered disproportionate price hikes this year,” Warren stated to Kanter.
“In May 2021, rates for processed poultry reached an all-time record, with consumer prices rising steadily through October. As the holidays approach, average Americans are feeling the pinch of these price hikes at the grocery store.”
Corporate profits are surging, but families and ranchers are getting squeezed by a meatpacking industry dominated by a few giants. We need strong antitrust enforcement to help bring down prices and fight inflation. https://t.co/t5nb2PLWzn
— Elizabeth Warren (@ewarren) February 9, 2022
“The lack of competition in the chicken sector enables these big corporations to squeeze American consumers and farmers to drive record corporate profits and dividend distributions to shareholders,” Warren stated.
“When businesses enjoy monopoly power as large suppliers, they can increase the prices of the commodities they sell.”
The Daily Wire reported that Tyson acknowledged recent price increases as inflationary pressures. Additionally, the company is contending with labor shortages, which have been a source of contention for firms throughout the United States.
In recent years, prices for consumables have increased significantly and are not limited to meat. Other food firms, notably the world’s largest food and beverage company, Nestlé, announced price increases to keep pace with inflation.
CEO Mark Schneider told the media last year “what we’ve witnessed this year is a kind of turning point, where inflation surged significantly after several years of low inflation.”
Inflation, indeed, is reducing the wealth of Americans.
While nominal salaries have been increasing, “real average hourly earnings” (which take inflation into account) fell by 2.4 percent between December 2020 and December 2021, significantly reducing the buying power of the American people.