“If concentration in the marketplace was somehow to blame for rising prices, then it would make sense to attack that problem by expanding competition. Give consumers more choices and they will naturally flock to lower-priced alternatives, putting pressure on other sellers to keep prices down.
The problem, for Biden, is that so much of his economic agenda is pointed in exactly the opposite direction. In one breath, he complains about the lack of consumer choice driving up prices. With the next, he proposes to further restrict consumer choice.
“We will buy American to make sure everything from the deck of an aircraft carrier to the steel on highway guardrails are made in America,” Biden said, before promising that his administration would make some of the “biggest investments in manufacturing in American history” to bring about “the revitalization of American manufacturing.””
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“”Shifting demand to American producers with ‘Buy America’ polices [sic] that stop firms and consumers from buying at the lowest cost, no matter how politically attractive, are inflationary. This is something all economists should agree on,” Summers tweeted. “Blaming inflation on corporate greed or holding out the prospect that capacity can be expanded rapidly is at best diversionary.””
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“Tariffs are also contributing to inflation by artificially raising the prices of imported goods, including products like raw steel, aluminum, and lumber that are necessary inputs for American manufacturers and home builders.”
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“The two researchers found that costs imposed by trade barriers were passing along nearly in full to consumers. For every 1 percentage point increase in the cost of imported construction materials caused by tariffs, for example, they found domestic price increases of 0.9 percent after six months.”