Every demagogue needs a scapegoat to blame for the people’s hardship. For the Biden-Harris administration, that need is particularly acute because the massive inflation of the past few years, and still-too-high inflation of today, can fairly be pinned on their brazen overspending.

People are particularly upset about the high prices of food, where prices have risen by 22% in President Joe Biden’s 3 1/2 years — the same increase we saw in the previous 10 years combined.

The obvious scapegoat for Democratic demagogues is corporate greed in the food sector. “Americans are facing sky-high food prices, caused by excessive price gouging by food and grocery giants,” declared Sen. Elizabeth Warren (D-MA) and Rep. Jim McGovern (D-MA) in a statement blaming inflation on “corporate greed.”

Warren, who knows better, has been banging this drum for a while. Now Vice President Kamala Harris, who may or may not know better, is echoing Warren. Speaking in Raleigh, North Carolina, before her convention, Harris blamed high food prices on “opportunist companies that exploit crises and break the rules.”

“A loaf of bread costs 50% more today than it did before the pandemic,” Harris said. “Ground beef is up almost 50%. Many of the big food companies are seeing their highest profits in two decades. And while many grocery chains pass along these savings, others still aren’t.”

Greed is a perpetual human condition. By the logic of Warren and Harris, greed has gotten worse under Biden. This isn’t plausible. More plausible is that the bipartisan COVID spending spree of 2020 and the Democratic spending spree of 2021 injected trillions into the economy at a time fewer goods and services were on offer. More dollars chasing less stuff is the formula for inflation.

Harris floated a federal ban on price gouging. Soon, she drifted away from that notion, instead talking about using antitrust law to prevent consolidation and anti-competitive behaviors. “I believe competition is the lifeblood of our economy,” she said in Raleigh, “and more competition means lower prices for you and your families.”

Yet here’s the irony in Harris’s call for “more competition”: The Democratic Party agenda over the past two decades has aggressively promoting consolidation and decreased competition in many industries, including the food industries. Sometimes this push for consolidation was intentional and explicit, and sometimes it was incidental.

More regulations and more subsidies; higher tax rates and a more complex tax code: This is the ideal framework for crushing smaller competitors, protecting the big guys, forcing consolidation, and erecting barriers to entry.

A bigger moat

In 2009 and 2010, Democrats in the White House and Congress advanced their financial reform plans, which they portrayed as a broadside against the big banks. The big banks disagreed.

“We will be among the biggest beneficiaries of reform,” Goldman Sachs CEO Lloyd Blankfein predicted in 2010.

Five years later, Blankfein said the law did the trick. “More intense regulatory and technology requirements have raised the barriers to entry higher than at any other time in modern history,” Blankfein told shareholders in 2015. “This is an expensive business to be in if you don’t have the market share in scale. Consider the numerous business exits that have been announced by our peers as they reassessed their competitive positioning and relative returns.”

Jamie Dimon, the CEO of JP Morgan, explained that Dodd-Frank helped create a bigger “moat” around the likes of Goldman and JPM. Dimon reportedly “pointed out that while margins may come down, market share may increase due to a ‘bigger moat’” created by regulations. “In Dimon’s eyes, higher capital rules, Volcker, and [over-the-counter] derivative reforms longer-term make it more expensive and tend to make it tougher for smaller players to enter the market, effectively widening JPM’s ‘moat’.”

Sure enough, Dodd-Frank led to consolidation in the banking sector, which protected the big guys from competition.

Community banks shrunk as a portion of the sector in the years following the financial crisis and Dodd-Frank, found researchers from the Kennedy School of Government at Harvard. “There are economies of scale when dealing with regulation,” one of the authors said.

Democrats’ other Obama-era landmark legislation, the Affordable Care Act, was pro-consolidation — explicitly. The law’s subsidies, special taxes, and regulations have driven massive consolidation among providers.

Obamacare authors were clear that their image for the future of healthcare was vertical integration: Doctors would get bought out by hospitals, and so on. Also, they preached horizontal consolidation: “Physicians organize themselves into increasingly larger groups.” Consolidation has caused higher profits for hospitals, higher prices for patients, and lower quality, according to the most recent study on the “corporatization of independent hospitals.”

Obama budget director Peter Orszag is clear that consolidation is explicitly a policy goal of the Biden administration. Why? Because they believe big companies are simply better companies. Orszag has written in favor of the idea that “industry concentration just reflects the superior productivity of superstar firms.”

“Size confers real benefits to the economy,” he suggests. The biggest companies, the “superstar firms,” have “high productivity and paid high wages.”

Foodflation

This push for consolidation has shown up in Democratic food policy.

The Democrats’ top food-safety regulator for the past three decades is a revolving-door consultant named Michael Taylor. Taylor led the Food Safety Inspection Service in creating a new regulatory protocol for meat and poultry called Hazard Analysis and Critical Control Points, or HACCP.

One study by a Department of Agriculture researcher found that the regulation cost the largest beef producers 1.7 cents per pound, while it cost the smallest producers 7.8 cents per pound. For pork and chicken, the numbers were different but the pattern the same: Smaller producers’ compliance costs were about one-fifth the larger producers’ compliance costs.

The regulation “favors large plants over small ones,” the USDA researcher concluded.

In the Obama era, Democrats pushed two food safety bills in response to salmonella and E. coli outbreaks. Small producers, such as the Farm-to-Consumer Legal Defense Fund, saw these bills as a death sentence, while the giants — Kraft Foods, General Mills, and Kellogg — all supported the measures. That’s because stricter regulation causes market consolidation: It protects the big guys by killing small guys.

The same dynamic is true at the retail level. Massive grocery store chains can handle regulations and mandates much more easily than mom-and-pop shops can. Notably, Walmart and Costco have over the years supported hikes in the minimum wage and an employer mandate in healthcare.

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In all of these cases, Democratic policies reduce competition. Less competition means more room to raise prices.

If Harris wanted to take on grocery prices, her first step would be to undo her party’s legislative agenda of the past 20 years.