Jul 17

Inflation for the poor

I’m writing this to point out something that is quite disturbing now that I’ve given it significant thought. Its something insidious, sinister and totally unnoticed by most of society. For years, you’ve been hearing how the economy is getting worse, people more and more are unable to afford to survive yet this is all during a time when things are supposedly getting better. So you get the people on the left who just say there wasn’t enough time to finish cleaning up after Bush, you get people on the right and conspiracy theorists saying that the numbers are fudged by the left and the economy isn’t getting any better and the biggest problem is that both sides have plenty of reason to think they are correct. But, as usual, neither side is focusing and they’re both wrong. The problem isn’t that the economy hasn’t improved, it’s that a war is being waged behind the scenes. A class war, a war of incomes and expenditures where the wealthy win and the poor lose. In 2016 both sides went absolutely insane, getting incredible amounts of support and political involvement and turning the entire election process into a circus, yet both sides were complaining about the same problems. The same exact problem, people don’t have enough money and they’re sick of being poor.

So how does a wealthy class pit the poor class against itself? Well first it has to create a problem. I call it ‘Inflation for the Poor’. Now, sure inflation has always existed, and the prices of things continuously go up. The inflation over recent years however does not seem to be going up proportionally. It hit me not too terribly long ago what it was specifically, I didn’t even think about it much until then, but it was when I was in a McDonald’s drive through. I went to buy a sausage biscuit and to my surprise the price was more than $1.20 when I could have sworn it was just $1. It doesn’t seem like much, but that is a 20% increase in price. Then it occurred to me, the prices of the more expensive menu items hadn’t really gone up much, but the ‘value menu’ which used to have everything for $1 had become a spattering of 2 for $3 or 2 for $5 deals. Then I thought, you know sodas have gone up too. A 2 liter of Dr. Pepper used to be $1 and now it’s generally 2 for $3 on sale, even more at some places. That’s a 50% increase. So I started paying more attention at the grocery store, and the trend was in effect there as well. The organic produce, the name brand stuff, it hadn’t gone up too noticeably in price but the generics and cheap stuff had jumped quite a bit. Like generic of Hamburger Helper. The regular was about the same price, but the generics went from $1 (or less) per box to $1.50 or more per box. Generic sodas were maybe $.99 for a 3 liter and are now $.99-$1.20 for a 2 liter. Everywhere I look now it pops out at me, little seemingly insignificant things that were once $1 are now 2 for $3 or $1 and some change. According to the Big Mac index, the US cost for a big mac was $3.66 in 2007 and $5.30 (about a 69% increase).

So if it were just ‘inflation’ as we’re told to expect, then wouldn’t the costs of making these products increase? Well, companies are making record profits, minimum wage hasn’t increased, many companies are moving overseas for cheaper labor and more lax environmental regulations so if their costs aren’t increasing why are their prices? If it were just inflation as usual, then why is it that the average price of a new home has only gone up around $50k between Jan 2007 and and Jan 2017 (around 12%)? Why has the cost of a new car only gone up from 2007 to 2016 about $2k, and when adjusted for inflation it shows the cars are actually cheaper now?

Quite honestly, it’s because who is really going to notice paying an extra 20-60 cents here and there? Who that matters anyway, poor people complain about prices anyway. Now, the higher class people would notice if the average price of cars jumped from 25k to 40k, but no one’s going to notice much if their stop at the gas station goes from $10 to $15. But the poor will notice. The poor will see they have less money to spend, and even as the economy slowly lurched forward during Obama’s term the poor saw the opposite. The poor saw prices going up, pay staying about the same, and job markets getting smaller. So what do the wealthy higher class people get out of this? They get to remain safe, they get to float nicely above the throng of the lower classes fighting each other, blaming each other, not realizing they’re complaining about the same exact problems. So you can’t hunt for the real culprits by party affiliation. I mean sure, the left is definitely better than the right but that doesn’t mean people who openly support the left aren’t also part of the problem. (cough warren buffet cough).

So pay close attention and notice, if and when the economy improves the people will still be complaining and upset about not having enough to get by. While companies are cutting costs at every chance, they’re increasing prices on cheap consumer goods and its the poor who get hit the hardest. They think inflation for the poor will keep us at each other’s throats and not going after them, are you going to take the bait? Are you going to keep fighting against your neighbor over the same exact problem that is hurting you both?