We often think of inflation as bad for everyone, but that’s wrong. Someone is getting and keeping all those extra dollars everyone is paying. Inflation is conflict: business vs business, industry vs industry, workers vs profits. Its a battle to see who gets all those inflation dollars. We saw this play out in the food supply chain last year as Frito-lay fought with Loblaws over who would capture inflation dollars. The Bank of Canada believes higher interest rates are the solution to inflation. In fact, higher interest rates are actually increasing inflation. Homeowners, businesses and farmers are being sideswiped by interest costs. Cheap debt was pushed onto anyone who would take it — but now, the implications of rising interest rates for farmers could be severe. CCPA economist David Macdonald examines who has won and who has lost from inflation in the food supply chain.
David Macdonald is the Canadian Centre for Policy Alternatives’ Senior Ottawa Economist. Since 2008 he has coordinated the Alternative Federal Budget, which takes a fresh look at the federal budget from a progressive perspective. David has also written on a variety of topics, from child care to income inequality to federal fiscal policy. He is a regular media commentator on national policy issues, often speaking to the CBC, Globe and Mail, Toronto Star and Canadian Press.
