The key to understanding what’s going on is inflation.Many experts are paying attention Wrong way.white house, news The media and Wall Street primarily focus on monthly reports that show how much inflation has risen over the past month and year. For example, the latest reading from January 2023 to January 2024 was 3.1 percent, down significantly from 6.4 percent a year ago. But many Americans think about inflation in the long term. We focus on cumulative increases since 2020. The number that sticks in most people’s minds is 20%. This is equivalent to how much inflation has risen since the coronavirus pandemic began. (Up about 18% since President Biden took office).
Inflation is shocking and angering Americans. It also doesn’t help that the prices of many of the most visible items people often pay for, such as gas, groceries, electricity, and rent, have skyrocketed in his 2021 and beyond. Rent has increased by nearly 20% and groceries by 21%. Meanwhile, electricity rose by 28% and gas by almost 35%. Some people remember what they paid in the past. Budgeting and banking apps also make it easier than ever to compare your current costs to what they cost years ago. Americans haven’t spent this much of their income on food in 30 years. And you don’t need to know the exact data to feel the pain.
Of course, the news about inflation is not all doom and gloom. Since President Biden took office, clothing prices have increased by only 8% and consumer electronics prices have increased by about 6%. According to the Bureau of Labor Statistics, toys and health insurance have actually gotten cheaper over the past three years. However, these items are often purchased infrequently and do not remain in people’s minds. It’s also difficult to make a complete comparison, since very few people buy the same toy twice.
The administration is quick to point out that wages have also increased since Biden took office. There’s no doubt that now is one of the best times for people to get a better job in decades, as companies have had to offer higher wages and more flexibility to attract workers. there is no. Since 2020, average hourly wages have increased by 21.5%. In comparison, the inflation rate is around 20 percent. After January 2021, the situation became a little less optimistic. Wages increased by 15.4 percent and inflation increased by 18 percent. But these are averages. Don’t forget that necessities like gas, groceries, rent, and car insurance are getting more expensive.
“There is widespread elation among economists that inflation is under control,” said Constance Hunter, senior adviser at Macro Policy Perspectives. “But if you look at the cumulative price increases since the pandemic began, the numbers are still very large. People are still feeling the effects.”
Since February 2020, Hunter began tweeting monthly dashboards showing food, energy and rent price increases. Others would be wise to look at the same data.
Another key to understanding America’s persistent pessimism is to look at the huge spike in inflation since the pandemic. First, there is the cost of renting a car. This was so crazy for a while that people tried to rent U-Haul trucks because they couldn’t get cars at the airport.Next, gasoline prices A few months after Russia invaded Ukraine in earnest in February 2022, prices skyrocketed and at one point exceeded $5 per gallon. The next topic that became a hot topic was egg mania. Inflation continues like a game of whack-a-mole. As soon as one price spike subsided, another soared. No wonder people are still concerned and wondering what will happen next.
“people Focus on the worst-case scenario right now,” Hart Research pollster Jeff Garin told me. “When gas prices were high, they focused on gas prices. When gas prices were significantly lower, it didn’t matter as much. Then they focused on grocery store prices.”
This kind of inflation is tailor-made for the TikTok era. Every few months, I find myself getting into something new.Car insurance prices are rising even as overall inflation has subsided. — up more than 20 percent in the past year (44 percent since President Biden took office). While it’s possible to save money on grocery store purchases by eating less meat, it’s much more difficult to reduce the amount you pay for car insurance.
The inflation story from 2020 onwards is very different from the rosy outlook of previous years. The past year.good news today It means that people’s wages are actually starting to outpace inflation. The longer this situation lasts, the more likely it is that Americans will realize that their lives are better and that the worst is over.
But it would certainly help Americans if there were no other essential items whose prices would skyrocket this year.