William Thien

A bit of rambling in this observation but it all ties in at the end as you will see.

Prices have been on the rise, substantially on the rise, for decades, and it is all by design. As I have mentioned in previous observations on the subject, The FED (Federal Reserve Bank) has been stimulating inflation for a number of reasons. Those who control supply of products and property want their prices to go up to increase profits. Also, the political climate is one that will not allow a politician to say he or she is going to raise taxes and by driving prices up, inflation, sales taxes increase proportionally and nobody has to lose office. There are other reasons but for the sake of this observation, it is not necessary to discuss them here.

The FED has taken steps by raising interest rates over the last year to reverse the massive inflation caused by its historically low interest rates, so low that they have never been lower, even before pre-Christian times. Recently talk has been that The FED has raised rates to levels it believes will reverse inflationary pressures on the consumer and prices will start to come down again. Each and every month over the last year or so The FED has raised interest rates, until recently when it has entered a pause in such money supply manipulation.

But the prices of things that I purchase regularly are still increasing, sometimes quite a bit, twenty to fifty percent per month.

This has caused me to examine why that is the case, why are prices still going up if the cost of money is higher and supposedly slowing inflation?

We see that automotive gasoline has started to come down in price and fuel is one of what I call the “levers of inflation.” The price of gas goes up; the price of shipping goes up. The price of gas goes back down, the price of shipping stays up (hey, what’s up with that? Talk about a scam on the public).

Fuel therefor is what I call one of the non-reversible “levers of inflation.” Changes in the price of fuel are what I call a source of “False prophets. Ahem, false profits.” In other words, the product doesn’t have to get better. All the shipper has to do is increase its prices to cover the costs of the increase in the price of fuel, one of its inputs, and then leave its prices up when the cost of its input, fuel, goes back down again. Everyone who relies on shipping as part of their production process thus increases their profits when shipping and fuel prices go up. They must pray for fuel prices to go up in some industries merely so they can increase profits because were it not for the fluctuating price of fuel, their profit margins would stagnate. They haven’t improved their product. They haven’t invented more efficient processes. They simply raise their prices when fuel goes up in price. Nice little deal, isn’t it? But for a country that has survived on innovation, though, not so good. This is one reason why I support the electric car industry. It is innovative and doesn’t pollute the environment as much as each and every little auto belching out carbon monoxide during the commute. Yet, I digress.

So, if the cost of money is one of the levers of inflation, and The FED has been doing something for the last year to reverse the damage it has caused to the value of the dollar by making things more expensive, and if fuel prices are down, fuel being another lever of inflation, what then is causing the price of consumer goods to still be generally increasing?

I began to ask myself that question every time I checked out at the grocery store. Why does my bill keep going up when I am buying less and less?

Then it occurred to me. And I’m sure it is obvious to many already.

Corporations, conglomerates that focus on food products have for the last couple of decades been snatching up brands and production lines like never before and our government has done nothing about it.

Not unlike The Standard Oil monopoly/oligarchy of the early 1900’s, some food processing conglomerates own hundreds of food brand names and all of their production lines whether they be vertically or horizontally integrated. All the vertically or horizontally integrated part means is that if a company grows its own tomatoes and prepares and packages them and then distributes them, if they control the complete production cycle from seed to store shelf, then they are vertically integrated. Horizontal production merely means production responsibilities are shared by multiple companies or varying facilities.

So, if a food conglomerate buys hundreds of brand names of food producers that are both horizontally and vertically produced, they control a large portion of the food supply. They don’t need the price of fuel to go up. They don’t borrow large amounts of money to generate profits. They simply begin raising prices because they can. They make it all. They cook it all. Therefor they can charge whatever they want.

In the early 1900’s Standard Oil was deconstructed by the government because it controlled large portions of oil production in The United States and was gouging the fuel buying public. Fuel being a necessary component of industrial production, it was starting to have an effect on the prices of everything. The government broke up standard oil because it was the right thing to do for the country.

Our government has not been doing anything about the massive food conglomerates controlling food supplies in The United States. The Department of Justice has done nothing about it and it is the DOJ that would do something. It is called antitrust litigation and our government has let big conglomerates like ConAgra for example, purchase huge numbers of companies and their related production capacities.

Just take a look at all of the brands that ConAgra owns: https://www.conagrabrands.com/brands

If that isn’t a cause for concern when it comes to the food supply in The United States, then I don’t know what is? One company having so much control over so much food? Not a good thing. Especially when they force their subsidiaries to start substituting fake meat for the real meat which they made their various quality brand names on, or reconstituted food matter for real food stuff, to increase profits. These big food conglomerates purchase brand names that have made a name for themselves by creating quality products. Then, the conglomerates move in and begin to control production, marginalizing quality but making it look like they are selling the same product the original company made its name on.

The DOJ went after Microsoft when it was buying up companies and conglomerating in a similar fashion, for example, but corporate food conglomeration has been allowed to go on for decades unabated. Why is that? I’m not entirely certain though it is possible it is due to corruption in D.C., but it is more likely that our government isn’t nimble enough in a legal sense to take those large agricultural producers on in the courts.

Our elected have focused almost the entire legal code on the individual in The United States on behalf of special interests, and that has been the focus of such governmental entities like The DOJ.

Recently the DOJ has started going after large social media companies and those aggregates, but in my opinion, though necessary to a certain extent, that is a political endeavor more than anything. It won’t affect the prices of necessities. The government does very little to regulate the producers of necessities and that’s where the big money has been focusing for quite some time. Food. Fuel. Housing. Now that conglomerates like ConAgra control massive portions of food production in the U.S., it stands to reason that food prices have gone up and up and up. That is the nature of capitalism. Were it not for the fact that they substitute fake meat for real meat, food byproducts for real food, this entire episode might not have caught my attention. But it is all corporate slight of hand. It is bait and switch on a massive scale and it is focused on the country’s nutrition, the primary source of the country’s health. The government is doing nothing about it.

All of that being said, the identification of the levers of inflation, the description of food production conglomeration in The United States driving food prices up and up and up, what can be done about all of this price fixing? Because that’s ultimately what it is. Price fixing.

The government can begin antitrust litigation against the massive food production giants. They can break them up and re-invigorate the production of quality food in The United States. And they can start doing it, now. There isn’t a grocery store shopper in the country that will stand in their way.

I have said this before. Don’t mess with the food supply.

Copyright © William Thien 2023

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