Miss a day, miss a lot. Subscribe to The Defender’s Top News of the Day. It’s free.
Following the release of the Labor Department’s latest Consumer Price Index (CPI) report, a new analysis from government watchdog Accountable.US found major corporations across several industries that have raised prices on everyday necessities like food, shelter and utilities have raked in “record-high profit margins” and near-record operating margins while rewarding wealthy investors billions of dollars.
The report comes after the welcome passage of the Inflation Reduction Act, which has yet to take effect fully and helps rein in corporate profiteering.
Some of the largest companies within the CPI’s major categories — food, energy, healthcare and shelter — have continued to raise prices while making over $6 billion in increased profits in the first half of fiscal year (FY) 2022 compared to FY 2021.
Meanwhile, these same companies have increased spending on shareholder handouts by $15.4 billion year-over-year for a total of $62.6 billion.
According to Liz Zelnick, spokesperson for Accountable.US:
“It’s clear that corporations that inflated prices over and over on working families despite reporting massive profits and generous giveaways to wealthy investors are never going to regulate their own greedy behavior. They simply can’t help themselves.
“Unfortunately, we’re seeing many companies try to maximize profits on the backs of consumers before the Inflation Reduction Act takes full effect. It’s yet another reminder why profiteering corporations need to finally pay their fair share in taxes as they refuse to lighten the cost burden on everyday families.”
Key findings from the report:
- Mondelez noted that it hasn’t seen much consumer pushback over its price hikes as it saw $1.6 billion in net income and spent nearly $2.4 billion on stock buybacks and dividends in the first half of its FY 2022.
- Kraft Heinz — which has raised prices and announced that further hikes would take effect in August 2022 — saw its net income skyrocket by nearly 93% to over $1 billion and spent $980 million on dividends in the first half of its FY 2022.
- General Mills — which hiked prices five times over the past year — saw its net earnings climb by 46.5% to over $1.4 billion, while it spent over $1.1 billion on buybacks and dividends in the last half of its FY 2022.
- Eli Lilly — which was sued by the state of Arkansas for “artificially driving up insulin prices” while its CEO touted the launch of its expensive new diabetes drug Mounjaro — saw its net income increase by nearly $110 million as it increased shareholder handouts by over $1.2 billion.
- CVS Health — whose chief customer officer admitted that “we’re able to pass inflation through to our customers” — saw its net earnings jump by $259 million to $5.27 billion and increased shareholder handouts by over $2.1 billion in the first half of 2022.
- Mid-America Apartments — the largest publicly-traded apartment company in 2021 — touted “strong pricing performance” and called rent growth its “primary revenue driver” — as it reported its net income increased by over $57 million to over $330 million in the first half of 2022 while boosting shareholder dividends and distributions by $15 million to over $257 million.
- Starwood Properties — the second largest publicly-traded apartment operator in 2021 — saw its net income skyrocket by over $417 million to $666 million during the first six months of FY 2022, as its CEO boasted that “apartment rent continues to rise” and the company spent over $294.2 million on shareholder dividends.