Inflation

This week's Camino a Ítaca looks at the rising cost of merely taking a breath. Click over to read the original Spanish version in el HOY or read the English translation below. (PDF abajo)

After living and working on four continents, my social media feeds can at times seem like a BBC world weather report. Friends living in Australia and Southeast Asia tend to post in the very early hours here in Spain. During the day, friends and relations here in Europe and across the Mediterranean in Africa fill my feeds. Then, just as I’m going to bed, New York, Calgary and Los Angeles start to chirp in.

The disparity of the time differences is also usually reflected in the content. In just one day, ex colleagues in Hong Kong can be lamenting the erosion of democratic freedoms, while in Yemen they might be bluntly speaking of ongoing famine and nearby missile strikes. While in Key West, Florida ,they find themselves once again preparing for hurricanes.

Ideological differences can also be just as severe. Acquaintances in the Midwest of the United States might be virulently justifying their right to openly carry weapons of war at the same time as British friends post pictures of the endless airport queues they now have to suffer after the Brexit disaster.

The curious thing is that amidst all this noise and disparity a strikingly common theme has emerged in recent months. It’s a general complaint that obviates time zones and ideologies, and it’s getting louder on all sides.

How have things become so expensive?

And while everyone on my Facebook wall unanimously concurs that prices have risen way beyond what can even be considered extraordinary, the consensus stops there.

The right and left may debate about whose fault this is, but the cause is clear. Corporate profits are at their highest point in 70 years.

In Poland they blame the far-right for the people’s inability to make it to the end of the month, while here in Spain Feijoo and his acolytes seem to believe that Pedro el guapo possesses superpowers to cause this phenomenon around the world. But the painful truth is that at least 60% of the price increases we are suffering stem from corporate profits. Sorry Olga and Macarena, it’s not taxes.

Why are corporations raising prices? Simple, because they can.

The global inflation we are experiencing, conveniently hidden behind the veil of a war, has been the excuse to not only pass along costs to the consumer but to inflate prices beyond that and engage in straightforward price gouging.

How is this possible? Easy. While the likes of the ex-minister of Finance, Fatima Bañez joins the ever-growing list of defunct politicians to join the ranks of these enormous multinationals, our economies are forced to depend on a shrinking number of corporate giants with the power to raise prices.

If markets were truly competitive, companies would be forced to keep their prices down in order to prevent competitors from grabbing away customers, but as banks and these enormous companies merge into larger and larger conglomerates, where is this real competition?

Corporations are using the excuse of inflation to raise prices and make fatter profits. Call it extreme left, call it extreme right, but this structural problem can only be solved one way: the aggressive use of antitrust law.

My timelines are screaming under the weight of this abuse, but I wonder…is anyone in the EU listening?