Inflation

Photo by olieman.eth on Unsplash

I, like many people, go grocery shopping weekly. For years, I’ve spent $60ish each week to feed myself, my kid, and supply my home. I went grocery shopping yesterday and it totaled over $100. I didn’t buy more than usual or anything unusual. It was my normal $60 trip except I had to pay an extra $40. I wish I could say I was surprised, but I wasn’t. My grocery bill has been getting steadily higher for a little while now and inflation is all over the news. It’s just frustrating in at least three ways.

The financial frustration is the most obvious. Things cost more and my income hasn’t kept pace. As a matter of fact, my income is way less than it was just three years ago. I can no longer do the stuff and buy the things I used to. I think most of us are in a similar position right now.

The emotional frustration is directly connected and can be divided into two parts. First is just the result of not being able to do things and buy things. That’s a major stressor. Not to mention it makes self-care extremely difficult. The other part is a bit more abstract, but it mostly comes down to lack of stability. Things are changing too rapidly. I used to have a good sense of what to expect when I went to the store. I no longer do. I’m living with a vague sense that I’m being ripped off whenever I buy something. It’s unpleasant.

The thing that bothers me the most about inflation, though, is the intellectual frustration. I’ve read the economics textbooks. I know what inflation is, the theory behind it, why the Fed raises interest rates to combat it, and all that stuff. The thing that’s so frustrating is that the professional economists don’t seem to know more than I do. I’m, at best, a curious amateur when it comes to economics, but I’ve been able to predict every move the government has made this year. Where’s the innovation and experimentation? I don’t even hear any discussion of trying something different.

There are things beyond hiking interest rates that can help. In Connecticut, for example, they did pass some measures to combat the rise is gas prices. They suspended the gas tax and they made busses free for a few months. The first part of that was silly, as I’ve talked about before. Anyone who seriously thinks that gas would be $0.25 more per gallon with the tax is being naive. Gas stations are charging as much as the market will bear. The other half of it, though, is brilliant. Free public transit means people can get where they’re going and not have to pay for gas at all. Plus, the drop in demand should help lower gas prices going forward. The problem is, the Governor won’t shut up about suspending the gas tax, but there’s not a peep about the free busses.

The government could also use the strategic oil reserve to help (although I don’t like that idea). Or they could step in and fix the supply chain issues that are behind so much of this round of inflation. When they’re functioning again, they could even regulate them so there is more slack so this doesn’t happen again. I don’t hear Biden or Congress trying to do any such things, though.

It would be far less frustrating if the government stopped looking at inflation as a problem and started looking at it as an opportunity. Does oil cost too much? Let’s all stop using oil. Is food too expensive? Let’s redesign the food market entirely. Are houses unaffordable? Let’s redesign real estate. The fact is, as I’ve said many times before, our economy has been broken for at least fifty years now. Why are we content to live with it? Why do we keep trying the same old things? I’d really like to know.

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