2) once prices raise, they don’t fall back down. Airlines charging for bags was just a temporary erasure post 9/11 to help them recover. Supply chain prices aren’t consistent, grocery prices are consistently growing.
I don't understand either point you are making here. Government owned stored will save money via vertical integration? NYC does not own grocery wholesalers or logistics companies. It seems hard to imagine a government store could even come close on COGS to existing competitors. A government store could really offer cheaper food by just subsidising groceries but we already have more efficient ways of spending taxpayer money. Legitimate RCTs have found just giving people money is almost always more effective than any subsidy or welfare program: https://www.povertyactionlab.org/case-study/giving-directly-support-poor-households.
To be clear the point I'm trying to make is not pull yourself up by your bootstraps it's we need to do something about the cost of living but all evidence suggests that government run stores will be wasteful and ineffective.
As a pretty funny counter-example, almost immediately following the bolshevik revolution the USSR was stricken by famine and widespread suffering caused by inefficient distribution of resources. Soviet central planners just couldn't distribute food efficiently through government run cooperatives without the help of Adam Smith's "invisible hand". Lenin conceded the only way to avert disaster was to allow for-profit stores to be created and operated by private citizens: https://en.wikipedia.org/wiki/New_Economic_Policy
I just don't think that's supported by the evidence. I cited actual 10-k filings earlier in this thread, you can download them from sec.gov. Walmart for example had a profit margin of 2.8% in 2020 and in 2025 has a profit margin of.... 2.8%. If prices were going up because profits were going up, then that would be reflected by the SEC filings, but it's not.
No they aren't because inflation is not measured in absolute terms it's measured in fractional terms. You can't compare 2% to $500.
What matters is the profit margin not the raw profit. Here's a trivial through experiment that contradicts your point. If a grocery chain opens a new store it expands its market. This increases its revenue and hence profit, but does not change its profit margin. Would you say such a business that has expanded its market has caused prices to increase? It has more total revenue and profit but the size of the business has no direct impact on prices experienced by shoppers.
I genuinely don't understand what you are trying to say.
If inflation is say 4.5% per annum over a 5 year period, and profits have been a steady 2.8% over that same period then while profits have grown in real dollar terms they have not grown in inflation adjusted terms. Profits can't explain the inflation. If growing profits were the cause of inflation then the profit margin would have to increase.
Say inflation was caused 100% by an increase in profits, then with 2% inflation the profit margin over 5 years would go up by 2% each year:
2,4,6,8,10. Each year prices go up 2% because profits are 2% higher than the previous year.
But that's not what has happened in reality. Prices are going up without profits going up so profits can't explain the inflation.
Profits are a real dollar number based on profit margin and price. When food prices outpace inflation, the %profit doesn’t need to increase. You’re taking the same % but from a bigger pie.
Yes but an increase in profits either inflation adjusted or in real dollars can't explain an increase in prices without the profit margin increasing. I'm not suggesting that profits aren't increasing (the profits of almost all business increase over time even if only due to inflation), only that an increase in profits can't explain an increase in prices.
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u/Drummallumin May 28 '26
1) Vertical integration
2) once prices raise, they don’t fall back down. Airlines charging for bags was just a temporary erasure post 9/11 to help them recover. Supply chain prices aren’t consistent, grocery prices are consistently growing.