“Food” is a four letter word. It’s vital for our long-term survival. Here in the United States our cost for food has been rising rather steeply. There are a number of related reasons for this phenomenon. China is suffering severe drought as are certain parts of the Southwest U.S. Other global regions are having difficulty raising food because of weather or war. As I have noted in previous columns, food is not included in the government’s “market basket” when calculating inflation. Somewhere in the bowels of Big Brother’s lair is a “white paper” that thoroughly justifies why food should not be part of the inflation/cost-of-living metrics. Major appliances such as washers and dryers are included, and most people purchase those every ten years or so. So why is it that “big ticket” items are dropped into the basket but not a basic unit of survival such as food?
The conspiracy theorist that resides in my body suspects that government does not include food in the market basket so they can lie to us about our cost or standard of living. They assume, probably rightly, that even though we see the increases in prices or the shrinkage of portions at the supermarket, we are not clever enough to identify the accelerating costs of our nourishment. They probably also assume that if we are perceptive enough to detect the creeping price increases, we’ll blame the store, the wholesalers or producers rather than the limply weak dollar that our Federal Reserve and our overspending governments have given us. If the government were the information source of the inflationary status of our food, we might blame them (correctly) for higher prices. So, in your efforts to eke out a living, “food” becomes a four letter word.
Another four letter gem that the market basket ignores is “fuel” or energy. We all know how little impact energy has on our cost of living, don’t we? (sarcasm mode). As our gasoline prices leap to roughly four dollars per gallon, the daily commute is transformed into a costly and necessary proposition. The politicians, primarily President Obama, loudly and crassly blame “Big Oil” for our situation, but the greatest culprit is the weak dollar…again, the Fed and the feds are to blame. As the value of the dollar slides, the number of dollars required to purchase goods must increase. The per barrel cost of oil ratchets upward while the worth of our dollar is shrinking. Add to the weakness of our currency the fact that our energy needs are nearly 70% dependent on imports, and we are condemned to the pain of higher costs. Fuel and food…are four letter words that represent vital elements of our economy and our lifestyles.
Rain is word that is having a huge impact on our economic situation today. Clearly the flooding in the Mississippi Valley and the various tributaries is covering thousands of acres of valuable crop land. It may be several years before the submerged acreage can return to its former productivity. If you’ve been following the news, you are probably aware that more than 130,000 acres in Missouri were intentionally flooded by the Army Corps of Engineers to minimize the threat to more highly populated centers downstream. The rain has delayed planting in many other areas of the Midwest and will undoubtedly result in lower yields because the growing season will be shorter than normal. The wet weather will have the greatest impact on feed grain production which will cause livestock feed prices to increase, and thus, elevate the prices for meat, dairy and poultry products. In addition, because feed grains are the primary components of ethanol bio-fuels, in order to satisfy their contracts farmers will have to divert additional acreages from feed-oriented production. As a result of the terrible weather, both food and fuel will be more costly in the near and distant future. Food, fuel and rain are four letter words that will have a negative impact on our economy as we move forward. The most damaging effect, however, has come from an unaccountable Federal Reserve Bank and an irresponsible federal government. If our money were sound, and if our political class did not promote an asinine energy policy, the bad weather would be limited to a short-term inconvenience for consumers in the supermarkets and at the gas pumps. Once again, the political elites and the banking interests blow it, and the people pay the piper.
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