Time to stop pretending economy is better for most of us
Several months ago, a woman stopped me in the grocery store, lamenting the price of shredded cheddar and how she couldn’t afford to make her husband’s favorite dish, macaroni and cheese.
This week, two things happened that once again crystallized how, for so many people, a thriving economy has passed them by and is nothing more than a David Copperfield-esq illusion.
This time, a man shook his head as he looked at his wife’s grocery list. “When in the hell did butter get to be $5,” he asked, exasperated.
Butter prices have been, on average, close to $5 since October 2022. In a vacuum, most consumers could grin and bear the increase. But when everything else goes up, that causes consumer angst.
Butter and cheese are two symptoms of an economy that works for the top 10% — in Ohio, that’s anyone who makes at least $228,000 annually — but doesn’t work for anyone else, those who struggle with everyday needs.
They struggle to find a house they can buy or rent they can afford. Between February 2022 and February 2023, median housing prices in the Dayton area shot up a staggering 42% to $181,000. Interest rates on a 30-year fixed-rate mortgage have hovered around 7%, the highest in two decades. Increased property taxes through re-evaluation also hurt the wallet and contribute to the inability to find affordable homes.
So, families enter an increasingly expensive rental market. Few municipalities in southwest Ohio have average rents below $1,000, and more expensive areas can cost 50% to 75% more.
From there, everything rolls downhill. The price of cheese and butter becomes magnified. Spending $10 on a fast-food burger, fries, and soda not only becomes an irritant but results in families thinking twice about making that expenditure. Want to take the family to the movies? Good luck. It costs about $30 per person, on average, to see a film and get some popcorn and a drink.
The rise in prices also turns people into thieves.
Recently, I saw a grocery worker run out of a store yelling, “Sir, SIR!” at a man who walked out without paying for his groceries. Sure, it could have been an innocent mistake. But I’ll let you decide if a guy ignoring someone yelling at him while walking hurriedly to his shiny vehicle and quickly loading his haul was simply late for a manipedi and had other things on his mind.
It’s true the economy is humming along, and the Biden administration deserves credit for preventing a recession. Inflation, now at 3.1%, is down by more than half from 2021, when it was 7%. Job growth remains
While wages are up slightly (based on the latest January jobs report), inflation eats up those gains, and that’s what people feel.
surprisingly strong, and the unemployment rate sits at 3.7%.
While wages are up slightly (based on the latest January jobs report), inflation eats up those gains, and that’s what people feel. The Dayton market, for example, anticipates a strong economic outlook for business this year, but the average worker doesn’t care about that.
They don’t care that we’re still recovering from the pandemic’s economic upheaval — that’s so 2020 — and they don’t care that all the objective data shows the economy is far better off than a year ago.
It’s not better off for most of us, and we need to stop pretending it is. Once we do that, we can start figuring out how to make the economy better for everyone, not just those at the top.