Greedflation? `Useful Idiots` and Shifting the Blame for Policy Failures

Recently, the neologism “greedflation” has frequently appeared in the mass media. The term is a portmanteau of “greed,” meaning excessive avarice, and “inflation,” referring to rising prices. It conveys the idea that corporations, driven by greed, raise prices excessively to reap windfall profits, thereby fueling inflation. In short, it claims that corporate greed is the cause of rising prices.

However, the emergence of such neologisms often does not accurately reflect the true causes of economic reality. Rather, they tend to obscure those causes and, in many cases, even serve to shift blame for policy failures. The same applies when existing terms are repeatedly used after their original meanings have been distorted. The concept of “greedflation” clearly falls into this category.

This term is known to have first been raised in June 2022 by the U.S. Democratic Party. At the time, as inflation reached its highest level in more than 40 years, some Democrats accused large corporations of stoking inflation through greed and began using this term. U.S. President Joe Biden even criticized oil giant ExxonMobil, saying that by raising gasoline prices it had “made more money than God last year.” In South Korea as well, the term has recently been used frequently in connection with price hikes by food manufacturers and restaurant chains, often accompanied by media articles condemning corporate greed.

A few days ago, I even saw a criminal psychology professor on a television program invoke this term and claim that “corporate greed causes inflation.” Even acknowledging that our society has come to trivialize true expertise and allow the opinions of well-known figures to dominate public discourse as if they were unquestionable truths, one cannot help but feel that this goes too far. If a criminal psychology expert were to speak authoritatively about economic problems and the causes of economic phenomena—and conversely, if an economist were to lecture on murder, robbery, or the concrete direction and methods of criminal investigations—and if such statements were naturally accepted as truth, it would be difficult to call such a society healthy or properly functioning.

In fact, these so-called “know-it-alls,” whether intentionally or not, should recognize that they are faithfully playing the role of what Lenin once called “useful idiots.” Using the term “greedflation” and blaming corporate greed for soaring prices amounts to acting as a “useful idiot,” helping to advance the very goals of those who are truly responsible for inflation—despite having no real understanding of the issue.

A closer look reveals that the true cause of inflation lies in the failure of government monetary policy and the resulting decline in the value of money. Without an expansion of the money supply by the government, overall price levels cannot rise across the board. Of course, even if the money supply remains constant, the prices of certain goods may rise due to changes in supply and demand. But in such cases, the prices of other goods will fall for the same reasons, making a general rise in prices impossible. Ultimately, the broad-based price increases we now call inflation are the result of governments printing and injecting massive amounts of money into the economy.

Because of this, governments and politicians seek to conceal their responsibility for causing inflation through monetary expansion. Better yet, from their perspective, is the ability to shift that responsibility onto someone else. The term “greedflation” fits this political need perfectly. It is a linguistic strategy designed to mislead the public into believing that inflation is caused by corporate greed. Notably, this term originated with the ruling party in the United States at a time when inflation was being described as the worst in history. That context makes it easier to understand why such a term was adopted. By using it, those truly responsible for record-high inflation could hide their culpability, redirect public anger toward corporations, and ride existing anti-business sentiment for political gain—achieving two or even three objectives at once.

“Greedflation” is thus a politically distorted term that shields governments and political leaders—the real culprits behind runaway inflation caused by failed monetary policy—while redirecting blame and public anger toward businesses. Such terminology does nothing to help diagnose economic realities or find solutions. On the contrary, it obscures the truth and worsens the situation. What we truly need is not to denounce the normal profit-seeking behavior of businesses as greed, but to carefully consider, identify, and implement sound solutions related to monetary policy and the stabilization of the value of money.

Kwon Hyuk-cheol
Director, Free Market Research Institute

Korean version: https://www.cfe.org/20250514_27640