Submitted by Cyberdragofinale t3_yk1ude in news
Synensys t1_iusu63w wrote
Reply to comment by hepakrese in White House announces $13.5 bln funding to help households with energy bills by Cyberdragofinale
Absolutely. We need a broad windfall profits tax. Not just for energy companies, but for all companies.
The American government, in an attempt to stave off a slow recovery during COVID poured way too much money into the economy, particularly to middle class and rich people who didn't need it. You can argue about the wisdom of this (I think it was probably a good idea, after we underspent post-2008 to be less cautious and its helped - we have super low unemployment and relatively fast rising wages, but even at the time lots of people were saying it was too much or too indiscriminate).
Those people couldn't spend it right away because of the pandemic but are now spending it like crazy. The increase in demand in turn allows companies to raise their profits without having to increase production costs - i.e. they get huge profits.
Unfortunately this is really hurting poor Americans, who while they too got extra money in the pandemic, probably spent it on necessities long ago. So it does make sense for the government to give them some assistance.
But eventually that extra money has to be taken out of the system. When it does, inflation will calm down.
But ultimately rather than letting the profits accrue in the accounts of corporate stock holders and executives, propping up the luxury markets and equities (essentially taking it out of the normal economy), they should tax windfall profits and essentially take back the excess money they doled out in 2020-21.
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