Lawmakers Criticize Corporations for Shrinkflation

Senator Elizabeth Warren and Representative Madeleine Dean have written to the CEOs of Coca-Cola, PepsiCo, and General Mills, accusing them of exploiting consumers through 'shrinkflation'—reducing product sizes while maintaining prices—while also benefiting from tax cuts. They highlighted specific examples, such as PepsiCo downsizing Gatorade bottles from 32 ounces to 28 ounces and General Mills reducing the size of Cocoa Puffs from 19.3 ounces to 18.1 ounces. The lawmakers demanded information about the companies' pricing strategies, their tax obligations without the 2017 tax cuts, and any bonuses received by executives amid rising inflation. Warren and Dean noted that these companies collectively profited billions while paying effective tax rates lower than the corporate tax rate established in 2017. The issue of shrinkflation has garnered broader attention, with President Biden advocating for legislative action to combat this practice. The companies have not yet publicly responded to the lawmakers' inquiries.