(FEE stories) It’s increasingly impossible to deny that both in the US and globally, prices are on the rise. Why does this matter?
Well, inflation acts as a stealth tax on everyday people. Their purchasing power is eroded and their quality of living deteriorates as a result. Inflation manifests itself in countless small yet pernicious ways.
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| Fewer saltines for the same money |
For example, a top Costco executive recently warned that his retail chain is going to have to raise prices on essential basic goods like bottled water and chicken due to the skyrocketing costs it's facing in its supply chain.
Other consumers are getting hit with "shrinkflation" as stores shrink the size of packages for a given price, a sneaky approach for retailers wary of the backlash that comes with raising sticker prices.
And ultimately all of this can be traced back to policy decisions. Inflation doesn’t come out of nowhere. It’s what happens when the government prints money to pay for spending, rather than directly raising taxes.
“Nearly one-quarter of the money in circulation has been created since January 2020,” FEE economist Peter Jacobsen recently pointed out. But printing more money doesn’t mean we actually have more stuff, and “if more dollars chase the exact same goods, prices will rise.”
Either way, we all lose.
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| President Gerald Ford tried to "Whip Inflation Now" with this button in 1974 |
And ultimately all of this can be traced back to policy decisions. Inflation doesn’t come out of nowhere. It’s what happens when the government prints money to pay for spending, rather than directly raising taxes.
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| Former one pound can of Folgers now 11.3 oz |
“Nearly one-quarter of the money in circulation has been created since January 2020,” FEE economist Peter Jacobsen recently pointed out. But printing more money doesn’t mean we actually have more stuff, and “if more dollars chase the exact same goods, prices will rise.”
Thanks Biden. Oh, wait, this is bad so lets blame Trump.
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