In a continued effort to deflect attention away from the Biden administration’s mismanagement, Elizabeth Warren contends that corporate greed is causing inflation and shortages and a lack of supermarket choices:
What happens when only a handful of giant grocery store chains like @Kroger dominate an industry? They can force high food prices onto Americans while raking in record profits. We need to strengthen our antitrust laws to break up giant corporations and lower prices. pic.twitter.com/DMa9Z7adFr
— Elizabeth Warren (@SenWarren) January 7, 2022
I live in a mid-sized American city in a purple state, and we have, within a 15-minute drive from my house:
- Target grocery
- Walmart grocery
- Two Harris Teeters
- Food Lion
- Trader Joe’s
- Fresh Market
- Earth Fare
And another half-dozen independent grocery stores, including an ethnic specialty-foods shop.
Now, granted, not everyone enjoys a similar number of choices. But, in general, American consumers have more options for their food shopping than anyone in the history of mankind.
Obviously, we’re going through a rough patch. But in 2020, the average consumer spent around 8.6 percent of their disposable personal income on food. In 1950, they spent around 30 percent. We are the beneficiaries of so much affordable food that Americans burn it to placate environmentalists and farmers. We have so much affordable food we implore people to stop eating so much. When I’m dispatched to the local supermarket to get . . . anything . . . I feel like Robin Williams buying coffee in Moscow on the Hudson.
Grocery chains, incidentally, are one of the least-profitable major businesses in the United States, with average margins coming in at a little over 2 percent. Kroger holds around 10 percent of the grocery-market share. Walmart holds the largest share, at 20 percent, and also provides the most affordable option. One of the reasons the big chains Warren wants to break up can offer lower prices is that they buy in massive quantities.
And considering the inverse relationship between more consumer choice/affordability and government intervention, the best way to keep food prices relatively low in the long run is stop people like Warren from taking advantage of a crisis and ruining another robust market. Inflation’s costs will always be absorbed by consumers. Warren’s price controls, or whatever regulatory interventions she has in mind, will never change that reality.
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