> Except labour costs are NOT the main driver of recent inflation

Wages drive spending and aggregate demand.

We know that tax cuts for the rich don't do it, if you want to juice aggregate demand give everyone a $500 tax rebate.

If everyone is employed and their wages are climbing they go out and buy things.

> indirectly drive down demand to the point where corporations can no longer justify their profiteering.

If you cut those wages that means that means that less is getting bought which means that corporations start to look at warehouses full of flat panel TVs or whatever that aren't moving fast enough, and they start to price them lower in order to move them. The corporation that sticks to their pricing model becomes the one left holding the bag with all the inventory that isn't moving.

Dunno why you'd describe that as only "indirectly" affecting prices since that is directly addressing the supply and demand curve that sets the prices of the goods. The company will always try to take any profits it can.

Rent increases drove inflation

> Dunno why you'd describe that as only "indirectly" affecting prices since that is directly addressing the supply and demand curve that sets the prices of the goods. The company will always try to take any profits it can.

It's an interesting double standard that you seem perfectly willing to tolerate this greedy behaviour from corporations, but not when it's individual people getting better wages and being employed. Here's a thought: instead of capping employment and driving down wages, why not cap profits and so drive down incentives to take any profits they can?

Also, in case it isn't clear, rate hikes are indirect pressure on inflation exactly because they don't directly suppress wages in the way you describe. Instead they tighten credit, which reduces how many people can be employed, which gives employers more bargaining power which only then, eventually, ostensibly, suppresses wages. That's a pretty indirect chain of events, as I said. Per the link I cited, since wages aren't the main driver of inflation here, this arguably isn't even the best way to tackle this type of inflation. We need different tools, but the elite neoliberal class only has a "labour must sacrifice" sledgehammer, so they can't see any other possible options.