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The Super Bowl was this weekend, and on Super Bowl Sunday we typically hear from our presidents. Since 2004 each president — from George W. Bush to Barack Obama, Donald Trump and Joe Biden — has sat for it nearly every year.
Biden, for his part, decided to skip the event this year, which is now the second year in a row he has done so. The stated reason from the White House was that they didn’t want to annoy the audience. Viewers were not interested in watching the president on game day, and just want to watch football, they said.
Very kind of them, but the decision to turn down an interview with a journalist that would be broadcast before the highest rated telecast of all time was a curious one for a president in the midst of a tough re-election battle, flagging approval ratings, and enduring questions about his mental state.
Even more curious is the fact that Biden apparently did want to talk to Americans on game day. He just sought a more controllable medium. On social media Sunday, Team Biden released a slickly edited video of the president complaining, like some kind of modern-day Andy Rooney, about how many potato chips are in his chip bag for the game.
Biden’s gripe was with “shrinkflation,” which is an economic phenomenon where consumer goods decrease in size or quantity over time, but price does not decrease with that size.
“I’ve had enough of what they call shrinkflation,” Biden said in his video. “It’s a ripoff. Some companies are trying to pull a fast one by shrinking the products little by little and hoping you won’t notice. Give me a break.”
Like most of Biden’s economic grumblings, the president is demonstrating a fundamental economic illiteracy, and is inventing a straw-man to attack.
The one thing he is right about is that there is a decrease in size in many consumer products that has taken place in the last few years. That is undeniably true, and is certainly noticeable.
The question, though, is “why is it happening?”
Biden believes it is because of corporate greed. This is also the case being made by people like Democratic Sen. Bob Casey of Pennsylvania, who released what he called “a greedflation report,” that examined shrinkflation. It argued that several product categories, from household paper products, to snacks to coffee, have experienced value loss due to smaller portions.
But is any of that true? Casey claims that for snacks, as an example, unit prices have risen by 26.4 percent since 2019. Yet remember that in that same period general inflation has spiked 18 percent, and food and drink prices have actually risen 23 percent.
This means that for manufacturers, the cost of materials to produce these items has radically increased. For paper products, lumber prices briefly exploded from around $400 per thousand feet pre-pandemic to as high as $1,686 per thousand feet in 2021, and inflated prices lasted more than two years.
So too have labor costs grown as wages have increased in response to general inflation. This has necessitated more investment in not just materials, but in people. And that doesn’t even begin to talk about the costs that come from capital investments in machinery, which have increased by 19 percent between 2020 and 2023.
None of this is meant to make you feel bad for corporations, which are generally doing just fine. Though it should be noted that certain corporate villains targeted by social media users for “greed,” like Clorox, have actually seen a massive drop in net income.
Rather it is meant to explain what is happening. When businesses have huge increased costs, they can do one of three things. They can increase the price of the item, they can keep the price the same and shrink the portion, or they can bankrupt themselves. The “shrinkflation” Biden is commenting on is happening because corporations have been forced to do a mix of option one and option two.
They were forced to do that because of the historic inflation that the country experienced, and even despite progress continues to experience. That inflation is the fault of both the Federal Reserve, in their manipulation of money supply and interest rates, as well as reckless fiscal policies pursued by both political parties across two administrations.
Biden can target corporate “greed” all he wants by counting the number of potato chips he is getting in the bag. But if he is searching for somebody to blame, he — and Donald Trump, Jerome Powell, and an endless list of members of Congress — need only look in the mirror.
