Dem
51
GOP
49
Yesterday, we had a letter from M.B. in Overland Park, KS, arguing that Americans are being hit hard by inflation at the grocery store, to the detriment of Joe Biden. And we had a response from A.S. in Chicago, IL, arguing that the talk of inflation is overblown. We also included some numbers that, in our view, largely supported A.S.'s argument about inflation, while also noting that doesn't necessarily mean M.B. is wrong about the impact on Biden's approval ratings.
That piece got a... vigorous response. In view of this, we thought we might share some of those letters while the subject is fresh in readers' minds. We begin with follow-ups from the readers who started it all:
M.B. in Overland Park, KS, writes: While food prices adjusted for past time periods may not show big increases, and on an item-to-item basis there are likely some that have returned to normal, but there are many that have not. Milk, bread and butter among them. At least here in KC.
In any case, the thrust of my argument is the perception that food prices are higher and continuing to rise despite the news reports that inflation is slowing. The consumer doesn't believe inflation is slowing when staple foods become more expensive every time they visit the store. They won't give credit to Joe Biden if they can't see it happening themselves.
Academic comparisons to past adjusted prices don't matter to them (as Z points out). The price keeps going up. That's the fact they know.
They ask: What is going to stop this price creep? Why is no one concerned about me and the price of bread and milk and butter going up every time I visit the store? They feel gouged because they see no reason for this continued rise besides greedy shop owners and producers showing record profits. And see nobody advocating for them.
Ironically, President Biden addressed price gouging in the news yesterday afternoon. And while it may only be lip service paid to this issue, ignoring it, and hoping people forget that prices are higher doesn't seem to be a very good strategy since, at least in my area, the stores are not likely to allow their customers to forget.
It is also my opinion that the prices for eggs, bacon, and other items that have fallen in recent months are somewhat attributable to the attention that these price hikes garnered in the media.
People see the cost increases with their own eyes and they see very little response from politicians. Democrats need to at least say "I feel your pain." If they don't, Republicans will.
A.S. in Chicago, IL, writes: Thanks for publishing my letter about the economy. There is a disconnect between the actual state of the economy and what people WANT to believe about it.
GDP is strong, unemployment is low, inflation is 3% for 3 months, gas prices are down 60 days in a row, Cyber Monday just set a new record, and on and on.
So the question is, why do so many people believe the economy is not doing well?
Because the media and Trumpists have a vested interest in saying so, even though the objective data says otherwise.
I am aware that you know the facts as I have described them, but we have to keep emphasizing that the economy is in good shape as noted by all the objective data.
A.C. in Zenia, CA, writes: When a price goes up from $1.40 in 2019 to $2.86 (eggs) in 2022, that price has gone up. According to your chart, prices increased from $3.04 to $4.09 (milk), from $5.61 to $7.31 (bacon) and from $4.14 to $5.89 (coffee) in those 3 years. No one I have ever met says to themselves, "Well, it hasn't really gone up because those are the 'adjusted-to-2022-dollars prices,' so it doesn't really bother me." Those prices are adjusted for inflation. Do you guys think this way in the grocery store? And very, very few people think that because their 401(k) has gone up, or their home value has gone up, the grocery store prices don't matter to them. And, of course, many millions of voters are at or just above the poverty line, so they don't have a 401(k) or own a house.
I agree with M.B. in Overland Park, who wrote, "Pissed off people who shop and feel gouged... will not be voters that are enthusiastic enough to show up [and vote.]" Your headline, "Inflation, Not So Much, Say the Numbers" might be better amended to say "...not so much say the numbers massaged by economists who love to massage data." So I would agree with M.B. that Biden should say something about grocery store prices, and if at all possible, DO something to try to bring them down. Is the federal government really unable to affect this? (Biden made some deal with MBS to bring gas prices down, right?)
Having said that, as a person who lives in a rural area (and has written a book about rural living), food prices in the U.S. are very, very low in comparison with most other countries. Earl Butz, in the Nixon Administration (from what I understand) promoted and enacted policies that drove down "commodity" prices, in order to quiet an angry urban electorate, with disastrous effects on the family farm. So, I actually think we SHOULD pay more for food in this country, so that small and medium sized farms and farmers can thrive in rural areas. After all, these are the folks who produce the very food we eat.
D.M. in Spokane, WA, writes: On Tuesday you published a table showing a comparison of current prices for four grocery items today to the prices for the same items over time. You showed the "adjusted for inflation price" to make earlier prices directly comparable to today's. Most of your readers would understand that, but the typical shopper doesn't. I don't know how many times I have explained "adjusted for inflation" to acquaintances who simply equate a higher price today to a lower price at some time in the past as being unconscionable. They simply refuse to accept that wages and salaries are inflated also, and that they have to compare the price now to the price after adjustment. In fact, a cousin became very upset with me over this, and shouted, "A dollar is a dollar, goddamn it, I don't care when it is."
D.N. in Elgin, IL, writes: I'm glad to see someone else responded to M.B in Overland Park. Instead of complaining about grocery prices they should be doing a little comparison shopping.
My usual grocery store is Meijer. Here are a couple of regular-price signs from today. A dozen eggs for $1.39 and a gallon of milk for $2.72:
There are brand-name grocery stores near me (ahem, Jewel) where a box of my favorite cereal (Post Great Grains) is more than $9, whereas at Meijer it's something over $5.
M.T. in Cincinnati, OH, writes: After reading today's comments regarding inflation, I feel compelled to add my bit because I'm feeling the squeeze like everyone else.
Prices have gone up but my wages have NOT. Period. My wages have remained flat for the last 5 YEARS. The only people getting raises are management. The people who actually make the company money get nothing.
While inflation may not be that bad, my WAGES have NOT INCREASED. Therefore, everything costs more to me.
As an example, I buy bottled soda at a convenience store on the way to work to have on the job (since we have no place to buy pop or snacks on site and everything is closed during my shift). That has gone up by $1 per bottle since 2020. That adds up quickly.
My electric bill has also gone up. So have my home Internet bill, my water bill, my insurance and my property tax. ALL of this has gone UP but my wages have not gone up AT ALL.
Of course, Biden has nothing to do with any of this. Arguing that there's "no inflation" misses the point. Even a small price increase to everyday purchases adds up quickly when you haven't gotten a raise in 5 years.
I'm sure most electoral-vote.com readers don't notice as much as some of us living paycheck-to-paycheck do. Even small price increases to everything quickly add up to a huge bill when you haven't gotten a pay increase to match the price increases. You just get more and more underwater.
THAT is why some of us are mad. It's just a general "mad" about everything going up in price. Biden gets the blame because he's there. Like yelling at the dog because you stubbed your toe.
I.S. in Durango, CO, writes: My theory as to why some people think prices have spiked is another red/blue divide. These days Democrats tend to be more educated and wealthy and care more about the environment than Republicans, factors that lead to buying more local and/or organic foods, which typically cost more. I happen to buy my eggs from a local rancher for $5/dozen, my bacon from the local college's ag outlet for $10/pound, organic milk from the supermarket by the half gallon ($4/half gallon or $8/gallon), and gourmet coffee beans from the supermarket, which are neither organic nor local, but higher quality and fresher, for $12/pound.
All of these are more expensive than the prices you listed, but they've all been the same for at least the past 3 years. The only difference I've noticed is that sale prices are higher than they used to be: The milk I buy used to go on sale sometimes for $3.29 and I don't think I've seen it under $3.59 lately, and ditto the coffee used to go on sale for $8/pound and now is never under $9/pound.
Maybe the higher-end products have more of a profit cushion baked in, so the sellers don't need to raise the prices even as the cost goes up? Or maybe it's that the sellers are worried that their customers will abandon them for cheaper commercial products if they make them even more expensive?
(Also I note that I'm paying approximately twice the average for all these staples, except for bacon, for which I pay less than 150%. I guess if I do need to economize, I'll have to go on an all-bacon diet...)
A.M. in Petrolia, CA, writes: I want to take issue about your two recent items about inflation and prices. I read your index pricing with interest because I have no idea where people are buying a dozen eggs for $2.86. Maybe it's because I live in California, but even at my discount grocery store, the best I can do on eggs is around $5.50. And it's not just eggs.
For the first time in my adult life, my family of four is struggling month-to-month, and often coming up short, despite the fact we have two wage earners in the house. EVERYTHING costs more, from gas, to health insurance, interest rates on our mortgage, home insurance, to tires, and more. And all those increases add up. The "economy" may look good on paper, but my bank statement at the end of the month doesn't lie. So much so that I have no idea how I'm going to pay for Christmas presents.
So yes, I'm pissed off, anxious, struggling, and every time I think I'm going to get ahead, something else increases in price and erases the gain. It's literally been like this for years. Where is the disconnect? I'm not sure, but don't blow off the struggles people are experiencing just because the numbers don't suggest it's real. Not affording Christmas (or the braces my kid needs, let alone college next year, or anything extra at all really) is real. We don't eat out because we can't afford it. We don't take vacations because we can't afford it. And I'm not the only one. Every day I see moms in my local Facebook group asking for help feeding their families through the end of the month. It strikes me as elitist to say that everyone is making it up.
J.E. in Gilbertsville, PA, writes: After reading your piece and seeing the averaged numbers, it occurs to me that average numbers will not tell the story of an individual family. My experience matches up with M.B. in Overland Park. I keep very detailed spreadsheets, by calendar year, of all of our family's expenditures, which makes it very easy to go back and see if we are spending more on groceries, and if my pay has increased apace. I went back to 2021 (because older ones are on a thumb drive, and I have a meeting in 9 minutes), and in 2021 we spent an average of $407.27/week on groceries for a family of 5. In 2022 I became concerned about what we were spending on groceries (It used to be well under $407/week) and so I started shopping at discount grocery chains, buying off-brand food, and shopping multiple stores and their sales. It's a lot more work than it used to be. And our average weekly grocery expenditure in 2023? $422.04.
My income most definitely has not outpaced these increases—my pay has gone up a whopping $42 per paycheck. I get paid every other week, so in a 2-paycheck month I make $84 more and I spend $59.08. My husband's pay has not gone up even a penny in that time. In addition, we drive diesel vehicles and fuel remains incredibly high, car insurance has gone up, local taxes have gone way up, all of our utility bills have gone way up, etc., etc., etc. Not to mention we now have three kids in college (in 2021, we had 1). We aren't the only family for whom everything has increased in price, and we are like everybody else in that we are very angry that we have to run to three grocery stores every week and still we are paying more for groceries!
E.R. in Irving, TX writes: A.S. in Chicago posed a question to M.B. in Overland Park: "Where are you shopping? I have not paid more than $1.20 for a dozen eggs, for example, in 10 months."
Eggs here at my local Kroger are currently $5-6+/dozen and $1-2/dozen at the same time, based on if you want the big bougie brown cage-free ones or the regular enslaved-chicken-in-a-cage ones or some other variety, such as the $10/dozen blue pasture raised "heirloom" eggs (whatever an "heirloom" egg is).
So, yes... people can go to the grocery store and see the price of a dozen eggs for $6 or even $10 and say "Bidenomics" or "post-pandemic price gouging capitalists" or whatever makes them feel good and then proceed to spend well under $2 for the dozen eggs they actually take home with them.
From this, at least three themes suggest themselves to us:
The big question is what Biden might do about this problem (just in case he doesn't have enough issues to worry about). One possibility, which we've mentioned several times, is to rage against the grocery-industrial machine a bit, just so Americans know that the President shares their concerns. Although, and as M.B. in Overland Park points out, Biden did speak out against high prices in a speech earlier this week:
Any corporation that has not brought their prices back down, even as inflation has come down, even as the supply chains have been rebuilt, it's time to stop the price gouging. Give the American consumer a break.
This speech was given as part of launching an initiative to try to help... bring down prices. So, Biden is clearly aware of the problem, and is clearly trying to grapple with it. Not that it got much news coverage.
In any event, it's hard to imagine that prices are going to drop much; likely not enough that people sit up and say "Wow, eggs and coffee are back to being affordable again!" So what else can Biden do? He can keep talking about high prices and how unfair they are, and maybe that will help some. Certainly, Franklin D. Roosevelt did himself much good by merely convincing people that he understood their problems and cared, even if his options were sometimes limited.
Beyond that, there is the Economic Stabilization Act of 1970. It gives presidents pretty broad authority to regulate prices in the name of stabilizing the economy, and has largely stood up to court challenges. Richard Nixon used that authority to execute, via executive order, the so-called Nixon shock of 1971. The good news is that, in the short-term, the maneuver helped cool inflation and to rebalance wages and costs. The bad news, and the reason that we haven't seen a similar move since, is that Nixon's maneuvering set the stage for the recession of 1973-75, and for the stagflation of the late 1970s.
In short, the U.S. economy is a very dangerous toy to play with. Biden might decide that he has no choice but to channel his inner Tricky Dick, but boy howdy, that is not his usual style. (Z)