Some economists believe that US inflation is being driven by a record surge in corporate profits since the start of the pandemic.
Aaron Sojourner, economist and associate professor of economics at the University of Minnesota’s Carlson School of Management, replying to a tweet by the House Republicans on the Biden administration costing the average American household an excess of $276 per month, Sojourner tweeted that high inflation is mostly being caused by private companies raising consumer prices to boost their profits, and not tax. According to data from the US Bureau of Economic Analysis (BEA) and the Bureau of Labour Statistics (BLS), corporate profits are at a record high, up 20% since before the Covid-19 pandemic struck, he further added.
The House Republicans had earlier tweeted that the elevated inflation in the US is a tax on all Americans. As per a demographic breakdown of inflation’s impacts, it was found that the Latinos, millennials, and the middle class were impacted the most by the price squeeze during the successive Covid-19 flare-ups.
Meanwhile, gasoline prices were among the factors driving inflation to a 7.5% annual rate in January 2022. Reports further suggested that inflation has been above 5% for the past eight months amid rising Delta and Omicron cases across the country.
Edouard Mathieu, the head of data at Our World in Data (OWID), tweeted on the Danish national health authorities having recently reported that the number of patients ‘with’ Covid-19 significantly increased, both in terms of hospitalisations and deaths. He stated that the problem was that they only make this distinction clear in rare articles and PDF reports.
Clarifying that OWID charts are based on official data, Mathieu highlighted that the debate around Denmark’s Covid-related deaths data is arising because of no clear distinction between people dying ‘with’ Covid versus ‘from’ Covid. He further added that the distinction was not an issue in 2020-2021, but with case counts exploding after the emergence of Omicron in late November 2021, these ‘incidental’ cases now represent a higher proportion of patients in some countries.
According to an article shared by Mathieu, the daily Covid-19 death toll in Denmark is expected to be slightly less accurate than before. However, it could be helpful in evaluating the mortality rate, as most people were dying due to Covid. As per the fifth week’s data of 2022, the country reported declining cases in all age groups since the first week of this year. This occurs even when the number of deaths caused by positive PCR tests is increasing, experts explained.
Jason Furman, economist and professor at Harvard University’s John F. Kennedy School of Government and a senior fellow at the Peterson Institute for International Economics (PIIE), tweeted on the real GDP numbers recorded by some countries in the fourth quarter of 2021 compared to their pre-pandemic forecasts, which revealed the US to have performed particularly well in comparison.
Sharing a chart on the percentage point change in employment rates across countries since before the Covid-19 pandemic, Furman tweeted that the US fared quite unsatisfactorily though as Iceland performed even worse. Experts believe that this could be a result of the connotation of lockdown in Europe being quite different and harsh, compared to the many restrictions in the blue states in the US besides in-person learning.