Former U.S. Labor Secretary Robert Reich came out swinging against retail giant Walmart on Saturday, accusing the company of gouging customers and helping to drive inflation.
The celebrity economist said in a Tweet that the mass merchandiser spiked prices on its private label brand, Great Value, and nearly doubled its net income to $10.5 billion near the end of 2023. That enabled the company to send $5.9 billion in buybacks and dividends to shareholders, Reich said in the Tweet.
“When I say price gouging is driving inflation, this is what I mean,” he said on X (formerly Twitter).
The Tweet prompted articles in Newsweek and elsewhere, which highlight Reich’s comments along with viral videos in 2023 showing the difference in prices on Great Value products that have more than doubled in price in some cases.
The Newsweek article noted that consumer inflation stood at 3.2% in February, “but remains far below the 9.1% inflation peak in mid-2022.”
The criticism comes at a time when political rhetoric about food prices and inflation is heating up. President Joe Biden criticized corporations for artificially increasing prices in late January and during his State of the Union address.
“Inflation is coming down. It’s now lower in America than any other major economy in the world. The cost of eggs, milk, chicken, gas, and so many other essential items have come down,” Biden said during a campaign event in South Carolina in January. “But for all we’ve done to bring prices down, there are still too many corporations in America ripping people off: price gouging, junk fees, greedflation, shrinkflation.”
In mid-March, the Federal Trade Commission released a report accusing large grocers, such as Walmart and Amazon, of using pandemic-era supply chain disruptions to boost their profits.
“As the pandemic illustrated, a major shock to the supply chain can have cascading effects on consumers, including the prices they pay for groceries,” FTC Chair Lina Khan said in a statement. “The FTC’s report examining U.S. grocery supply chains finds that dominant firms used this moment to come out ahead at the expense of their competitors and the communities they serve.”
