The following can be summed up as: Move up, or move out. But keep the current market in mind and have a firm landing established before taking the leap.
This is based upon years of personal observation. On the other hand, I'm not the most successful person in this environment. I've done very good things, technically, and have done very well interacting with people on a peer and ad hoc level, at all levels of various organizations. But I've never fit in too well, politically. I don't match the personality type that pre-dominates in corporate management.
0) (Cautiously) try to determine where this behavior is originating. Is it initiated by your immediate management, or is it coming from higher up? Is there a pay freeze or budget constraint that your immediate management can do nothing about? Are they going to bat for their reports, or just rolling over, either not requesting the increase/funding or not pushing back when first told "no".
(I had one manager who seemed to find some combination of necessity and pride in keeping his department budget low. He repeatedly screwed over his reports to make himself look better (in his eyes; maybe also in his management's eyes, depending on how lame they were -- underpaying and abuse are not good long term strategies). He probably could have obtained a budget increase (or maintained what he previously had) to avoid some of these situations, but he didn't try.
Later, at the same company, I had a different set of managers who produced double digit increases for me at a time when that "simply wasn't happening". They went to bat for me (after I pulled some proverbial rabbits out of hats). When there subsequently was a pay freeze, they found a way -- on their own initiative -- to pay for a conference trip I was already intending to pay for personally.)
1) Whether it's starting a job hunt, continuing your education, or something else, take some action that appeals to you and places you, in your own mind, on an equal footing with your manager/management. Don't allow yourself to feel caught indefinitely in their regimen.
2) Don't let this situation continue indefinitely. Either they take action to end it, or you do. Their action: Promote you and treat you like an adult, or terminate you. Your action: Grow within the position, or leave.
Think about it in terms of a learning experience. And from their perspective, what are they learning if/as you allow it to go on indefinitely? That they can jerk you around. Is that really what you want them to learn?
Further, if they "learn" this about you, your future with them is likely significantly diminished. Their eventual decision, if you leave the decision to them, is more likely to be to leave you parked where you are (or in very "incremental" growth), or to terminate.
(By the way, the means by which I moved from the first set of management to the second was by taking advantage of the open door policy of a new senior manager, after determining it to be genuine, and telling him without threat but plainly what had been going on and that I'd had enough. I already had the other management team interested in me; the senior manager simply removed the red tape preventing the move. This actually made life easier for him; he could simply let me move, rather than having to formally address my grievance. Though he did correct the situations of a couple of other department members while they remained in their positions. And having three or four members of the same department approach him with similar grievances very likely made a strong impression and influenced the outcome. The "quiet" people finally spoke up.
He deserves credit; it never would have happened, or happened so effectively, without that open door policy. Credit also to the one non-quiet department member who acted first in approaching him and thereby showed us the way.)
The job situation (in the U.S., I'll assume) is terrible. So I wouldn't just jump ship without having a firm landing established, and I would be very cautious about communicating this perspective directly (or passive/aggressively) to them. Short term, you may have to take it. But work and plan to establish eventual exits from it, one way or another. You'll likely feel significantly better. Regain some measure of control.
I hate to sound like I'm promoting an expressively aggressive attitude as the means to success. I've seen too much of it, in excess. But passive doesn't work well, in the corporations I've seen. I've watched time and again as moderately competent (sometimes perhaps marginally) but self-promoting people have passed by truly competent but "quiet" people. Or perhaps it's that the former have focused on the competency that matters more with regard to career advancement: Politics (and all that goes into it, which is a considerable effort including identifying what attitudes and results matter to whom of importance and focusing primarily on producing these, or the illusion of same).
I don't mean to sound too judgmental in this: It's what the system appears to require. Be sure in evaluating your own situation to consider this perspective.