If you live in the United States and feel an extra pinch at the grocery store, you’re not alone and it’s not a figment of your imagination.
During the 2020 presidential election cycle, food inflation in the United States has been 30.9%. With less than 50 days until the 2024 presidential election, food inflation has reached 25.8%, more than six times 2020 inflation.
Former president and Republican presidential candidate Donald Trump responded to a negative survey showing a small lead for his Democratic opponent, the vice president Kamala Harrisattacking him and the Democrats as the party responsible for the nation’s food inflation.
New Trump campaign political ads attack Harris for being the deciding vote that passed the 2021 American Rescue Plan, President Joe Biden‘s $1.9 trillion pandemic relief measure, which delivered funds to businesses and local governments.
Inflation hit a 40-year high in 2022, rising 9.1% from 2021. Although economists have pointed to the American Rescue Plan as a potential factor, the main drivers of this sustained inflation are considered supply chain issues during the pandemic, the conflict in Ukraine, which has driven up oil prices, and corporate price gouging.
Also Read: The Data Scientist Who Called the 2020 Election Rightly Claims It Went From a ‘Drastic Landslide for Trump to a Drastic Landslide for Harris’
The Fed finally lowers interest rates.
To combat inflation, the Federal Reserve raised interest rates eleven times between March 2022 and July 2023, from nearly 0% to between 5.25% and 5.5%. Raising the federal interest rate is a key measure to control inflation, provided it does not push the country into a recession.
As the 2024 presidential election approaches, the Fed ultimately lowered interest rates by 0.5% to head off a possible economic slowdown.
Lower interest rates will make it less expensive for businesses to borrow money for expansion, but it is unlikely to solve the whole problem because part of the problem is price gouging of businesses.
In May, Senator. Sherrod Brown (D-OH), chairman of the Senate Banking, Housing and Urban Affairs Committee, issued a statement emphasizing that corporate profits are a cause of consumers’ suffering at the grocery store.
“Today, prices are much too high and families are finding it more difficult to find a fair price, because a large part of their salary goes up in the air.” » said Brown. “All of this is happening while corporate profits are hitting record levels. Let’s be clear: The fact that prices and corporate profits are rising at the same time is not a coincidence.”
Brown said a Kansas City Fed study found that corporate profits were responsible for half of the price rise in 2021.
As a Democratic presidential candidate, Harris appears to agree that a policy solution is needed to control corporate price gouging, which has worsened the impact of inflation.
“My plan will include new sanctions for opportunistic companies that exploit crises and break the rules,” Harris said at an August 16 campaign event.
Jason Furmana prominent economist in the Obama administration, opposes Harris’ statement and believes efforts to regulate corporate prices will ultimately harm the consumer.
“It is more likely to maintain this status quo because it would prevent new competitors from moving in to take advantage of higher profit margins – competition that could have helped drive down prices in the long run,” Furman said .
Blockchain may have a solution
When seeking a solution to corporate price gouging, it is difficult to find a compromise between a company’s need to make ever-increasing profits year after year and the consumer’s need to live and buy food.
However, blockchain could have a solution if the next administration elected in November is ready to harness the power of new technologies.
Dan WeinbergerCEO of Morpheus MNW/USDa supply chain platform built on the Ethereum network, suggests that increased efficiency of supply chain tracking on blockchain could reduce costs for retailers, allowing them to maintain profits while controlling prices to consumption.
“Blockchain is fundamentally an indelible ledger, so it is a perfect platform for tracking prices within a complex global supply chain matrix. If large companies have more visibility into their supply chains, they can purchase more efficiently, eliminate redundancies and source from the most desirable sources. supplier,” Weinberger said.
“It is difficult to stimulate economic growth by creating legislation that punishes companies that make profits. Whoever occupies the U.S. presidency after November, we hope to work with the administration to help it understand the solutions already available to streamline supply chains and reduce costs. “
Cryptocurrency prices fell in mid-September after what appears to be the only 2024 presidential debate between Harris and Trump, which favored Harris and the superstar singer. Taylor Swift » approved the vice-president.
Trump has positioned himself as the pro-Bitcoin candidate to court the crypto-loving voter.
Recently, Trump visited Pubkey, a Greenwich Village-based bar that accepts Bitcoin BTC/USD. Trump paid for customers’ food using Bitcoin, a transaction he described as “very simple. It happens quickly and beautifully.”
Trump said it was his first Bitcoin transaction, but the event caused prices to rise.
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