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Food Prices Threatening The Middle Class

Mike

Well-known member
CBS News reports that the combination of food prices being inflated and the stagnation of wages is threatening the middle class. The report noted that staples such as chicken, ground beef, and bacon have skyrocketed in price since 2011: the price of chicken is 18.4% more than it was; ground beef is up 16.8%; and bacon saw a huge increase of 22.8% in price. These price hikes came despite the federal government’s sunny assertion that prices in general have only increased 6.4% in that period. Meanwhile, median income has only risen 1% each year, while the cost of college tuition has climbed 6% to 8% every year for at least forty years. ConvergEx market strategist Nick Colas commented, "Food inflation is far greater than the government thinks it is. The disconnect is severe, because it's the economists that make policy but it's the people who have to live with the outcome of that policy and that disconnect is growing to the point where I think it has to break soon.”
 

Mike

Well-known member
Investors Business Daily - Economy: Food and energy prices are rising, wages are flat and the top concern among Americans is unemployment. What was that word coined in the '70s to describe a stagnant economy suffering inflationary pressures?

Since the Obama "recovery" started 4-1/2 years ago, inflation appears to have been relatively tame, with core prices climbing just 7% from June 2009 to December 2013.

But as CBS News discovered when it looked a little closer, the overall number is deceptive. In fact, it found food prices soaring.

The official inflation data confirm this. Overall, food prices are up 9% since June 2009, according to the Bureau of Labor Statistics. And the cost of many staples is skyrocketing. Pork prices have climbed 14%; poultry is up 12%; eggs, 27%; milk, 20%.

Meanwhile, energy prices have climbed 18% during the recovery, and the price of gasoline is up a whopping 31.5%. Then there's college tuition, up 23%.

At the same time, wages aren't budging...
 

Steve

Well-known member
inflation is low because the government does not count many important items, like food and fuel costs..

If you've noticed your wallet seems a little lighter after a trip to the grocery store or gas station, you're not imagining things.

The government's measure of inflation, the Consumer Price Index, barely registers an increase in the prices consumers are paying.

The index vs. actual cost of living increases

What gives? Don't food and fuel prices count in the tabulation of the index? Not really.

The all-items inflation rate represents everything people spend money on: haircuts, plane tickets, medical care, clothes -- you name it.
But, that number is puffed up by the pesky necessities -- food and energy. So those two categories are discarded when calculating the core inflation rate.

Nevertheless, food and energy prices have increased at a much quicker pace than core items. Food prices increased at nearly twice the rate of core inflation over the past year, rising 1.8 percent compared to the core inflation rate of 1 percent for the year ending in January.

But that's nothing compared to fuel costs. "The big culprit has been energy prices, which are up 7.3 percent" over the same time frame, says Hampel.

If you're an average American consumer, as envisioned by the Bureau of Labor Statistics, about 15 percent of your total spending goes to food

and the poorer a person is the more impact the ignored inflation hurts..
 

hypocritexposer

Well-known member
obama: "those that said the stimulus would be a failure, are eating their words...cause that's all they can afford to eat"

I added a bit of truth...
 

mrj

Well-known member
Yet Farm Bureau research shows that food prices remain at about 10 to 11% of disposable income.

Could the discrepancy, if that is what is in play, be that there is such a wide variation between top and bottom incomes?

It truly appears to me that at least a considerable part of the problem in 'food security' is that so many people simply do not know how to shop and cook economically. I've been told that many of the needy folks also do not live in conventional homes or apartments, but are housed in something such as old motels (which is the case in Rapid City and other cities in SD) and may only have a microwave or a hot plate to cook on and have few pans, so can't even make an economical soup meal, for instance.

I wonder if there is any evaluation as to why people can't afford food, and efforts to teach them how to do a better job of buying and preparing the economical meals I grew up on, and still prepare often.

mrj
 

Steve

Well-known member
MRJ said:
Could the discrepancy, if that is what is in play, be that there is such a wide variation between top and bottom incomes?

buying food is basically a cost person..

the USDA says it is about $200 to $400 per adult..
According to the United States Department of Agriculture, Center for Nutrition Policy and Promotion, the average cost for food per month for one person in the United States is approximately two hundred ninety-four dollars ($294.00). This average cost for food per month for one person was derived by taking an average of the estimated cost for food per month for a single male and single female in two age groups (19 - 50 and 51 - 70) and four different food-cost plans (thrifty to liberal), as shown in the chart below.
http://www.loweryourspending.com/average-cost-for-food-per-month-for-one-person.html

we don't spend anywhere close to the low side.. but for an example of how it hurts the poor more..


if a well off family making $75,000 with two adults and two teens spends
on the high side.. 1600 a month.. it would be 25.6% of their income..
on the low side 12.8%
using the average.. $294 x 4 x 12 --- they would spend 18.8% of their budget on food..



now if the family of four who made $35000 a year,. even the low projection from the dept of ag.. spent $800 a month it would be just over 27% of their budget..
using the average.. $294 x 4 x 12 --- they would spend over 40% of their budget on food..


then when you add in gas, heating electric ect.. the poor get hurt more by inflation and stagnate wages..
 
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