Runaway inflation
What happened to the day when you could buy a gallon of gasoline for a buck and feed a family of four for $25 dollars a week?
The answer is inflation.
If you’ve driven your car lately, you know the price of gas has jumped to $3 a gallon. The price of ground beef has risen to $3 a pound. In fact, inflation is costing us more than seven cents a dollar on every purchase we make, compared to a year ago.
An inflationary economy is not good news for low to middle income families, especially those who have to rely on a fixed income to pay their bills.
The annual adjusted cost of living for Social Security recipients in 2022 is 4 percent, for example. That amount will barely cover 80 percent of the inflationary cost.
Many of us remember the inflationary boom of the Jimmy Carter administration. Inflation costs soared into double digits, and the cost of home mortgage loans climbed above 6 percent. Small employers struggled to offset inflation with salary increases for employees.
What caused the inflation this time around?
It started with policy changes implemented by the new Joe Biden administration.
Biden demonstrated his support for green energy introduction by shutting down the Canada-to-U.S. crude oil pipeline and setting lower production quotas on oil and natural gas products. The move came after the previous administration had achieved national energy independence and stabilized the cost of energy for consumers.
At the same time, the Biden administration set goals for the changeover from fossil fuel to green energy production – including wind, solar and electric.
The COVID-19 pandemic also contributed to the inflation boom by forcing business shutdowns, restricting economic activity and limiting the availability of consumer goods when demand exceeded supplies. Government payouts to families stimulated the market for durable consumer goods, such as automobiles and home appliances, while the movement of goods from shipping ports remained backlogged.
Many businesses experienced empty shelves as shopper demand exceeded supplies and employee staffs were left shorthanded.
