Real north-south divide on cause of inflation. US media: "Minimum wage" Aussie media: "Corp profits"
Company profits, not wages, have driven the soaring inflation in Australia, an analysis from the Australia Institute has found.
The thinktank has released evidence of what it calls a “profit price spiral”, arguing big business earnings account for 69% of the inflation that is above the reserve bank’s target range of 2-3%.
Australia is in the midst of a supply side inflation shock, with price increases being driven by breaks in supply chains because of the pandemic and natural disasters, as well as energy supply disruption due to Russia’s invasion of Ukraine. But companies have posted profits over and above those increases.
“We’ve been told a story that workers need to restrict wage growth and accept a permanent reduction in living standards in order to fix inflation ... This evidence shows that’s an economic fairytale."
https://www.theguardian.com/business/2023/feb/24/an-economic-fairytale-australias-inflation-being-driven-by-company-profits-and-not-wages-analysis-finds?CMP=Share_iOSApp_Other