Walmart's price increases have been slammed by a former U.S. labor secretary, who accused the retailer of driving inflation by engaging in "price gouging."
Robert Reich, a professor of public policy at University of California Berkeley, said Walmart's price increases on its house brands led to revenue soaring.
"Walmart hiked prices on its Great Value food brands," Reich wrote on X, formerly Twitter.
"The result? Its net income spiked 93% to $10.5 billion towards the end of 2023. Walmart rewarded shareholders with $5.9 billion in buybacks and dividends."
He added: "When I say price gouging is driving inflation, this is what I mean."
Walmart hiked prices on its Great Value food brands.
— Robert Reich (@RBReich) March 23, 2024
The result? Its net income spiked 93% to $10.5 billion towards the end of 2023.
Walmart rewarded shareholders with $5.9 billion in buybacks and dividends.
When I say price gouging is driving inflation, this is what I mean.
Last summer, a viral video on TikTok demonstrated just how much the price of some of Walmart's Great Value products had shot up between 2020 and 2023—with some items doubling in cost. Newsweek could not independently verify the veracity of the video.
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Reich has been contacted for further comment via email. Walmart has been contacted for comment via its website.
Consumer inflation ticked up to 3.2 percent in February, but remains far below the 9.1 percent inflation peak in mid-2022. Meanwhile, prices rose 0.4 percent from January to February, higher than the previous month's figure of 0.3 percent, the Labor Department said earlier this week.
Walmart's CEO John Furner recently said that stubborn inflation remains a "nagging problem."
"There are a lot of objective indicators that the economy is in a really good place, but asking consumers about it, maybe their sentiments don't match the reality," Furner, who also serves as chair of the board of directors of the National Retail Federation, said on Wednesday.
"The nagging problem is the stubborn inflation. Food inflation has been high but moderating."
President Joe Biden is among those who have criticized large companies for engaging in "price gouging" and "shrinkflation"—when a company shrinks the amount of product inside a package rather than raising the price.
"Too many corporations raise prices to pad their profits, charging more and more for less and less," Biden said in his State of the Union speech earlier this month.
"That's why we're cracking down on corporations that engage in price gouging and deceptive pricing, from food to healthcare to housing."
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Some lawmakers have also accused corporations of using inflation as a cover to raise prices and pledged to crack down on the tactic.
"Big corporations are gouging consumers by using inflation as a cover to keep prices high," Sen. Elizabeth Warren, a Democrat, wrote on X earlier this week.
"I'm staying in the fight to crack down on price gouging, shrinkflation."
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