Word: profiteered
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Dates: during 1970-1979
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What is the main cause for the sharp rise in meat and other food prices, and who benefits most from it? Consumers often complain that big business is the culprit, but that, in fact, is a bad rap. Supermarkets operate on profit margins as thin as wrapping paper; .9% on sales is the current average margin. The Great Atlantic & Pacific Tea Co. lost $55 million last year largely because of its "WHO" discounting drive. The so-called middlemen are also largely blameless, though President Nixon last year fingered them as the main perpetrators of the food price jump. The meat...
Says Walter Heller, a member of TIME's Board of Economists: "As I look at the various pieces of food-processing business, whether it is flour milling or cheese manufacturing, the profit margins are absolutely miserable all down the line...
Normally, there would be ample opportunity for all the people involved in the long food-production and marketing process to reap a reasonable profit. In the normal chain of events for beef, for example, the farmer sells his calf to a feedlot operator, who is one of the middlemen. He in turn fattens the animal and often sells it to a meatpacker for a few cents less per pound than he bought it. The feedlot operator hopes to profit by adding considerable weight to the animal in a relatively short time, but his problem lately has been that feed costs...
...agriculture a few years back. But they turned out to be helpless on a land they could not really understand, clumsy brontosauruses bogged down in rigid procedures. Relying on a labor force that lacked the farmer's single-minded devotion to the soil, they could not make a profit. One after another, United Brands, Tenneco, S.S. Pierce and other companies have retreated from the fields, abandoning some or all of their farm ventures...
...created 2,591 such companies since 1970. Some of them are sold to Danes who want tax shelters; the others he keeps for himself. By making his companies borrow money from each other, and pay tax-deductible interest to each other, he manages never to show a profit and thus never to pay taxes...