I ran into a blog post with the title above. The answer they came up with is off the mark, however.
Prices and costs are two different things. Prices go up and continue to go up because that is the way we designed the system. If we were to have designed it differently, we could have had prices that always went down or even stayed the same.
So, why do prices go up? It is obvious that they do. I remember buying whole loaves of bread for 25 cents, even 10 cents when killer sales took place. I also bought gas for my car at 25 cents per gallon when the price wars raged. Now whole loaves of bread cost $2-6 but the pricier breads are way better than the schlock breads we had available way back when. (Our grocery was in a WW2 surplus Quonset hut.) And gas prices are spiking way up now, but were in the high $2 to low $3 range before the most recent round of price gouging began.
But, when bread was 25 cents per loaf, the minimum wage was less than $2 per hour. In other words cents then were different from cents now. I got into the habit of always bending over to pick up pennies on the floor or sidewalk; I no longer bother doing this (isn’t worth the effort).
You see, the system adjusts. The average American income is about $55,000 now. When I was a child, that income would have made you one of the “rich.” That was back when $10,000 bought you a very nice house, indeed. If you made enough in a year to buy a house in those days, well, you were doing pretty well. The average (median) house price sold around here is now $325,000. As a college professor, I never made more than $75,000 per year (corrected for inflation, that would be about $120-150,000 now, so a college professor now makes enough in a year to buy half a house.
If you go back in time, the buying power of people’s wages held fairly constant from WW2 to roughly 1980. Then the wage suppression efforts of the conservative/wealthy types kicked in and real wage increases stalled from that point onward.
It used to be the case that as price increases occurred there was pressure to raise wages. I remember when wage increases were broken down into two parts: one was for “inflation” (aka price increases) and the other was above and beyond that, aka a real increase. This was because people figured out that if their salaries were increased only enough to deal with price increases, then their “raise” was not a real raise, as their buying power was unchanged.
What is shocking to me is that the wealthy folks continue their efforts, some quite underhanded, to increase their wealth, when that “extra wealth” doesn’t affect anything other than their egos. They already have enough income, enough houses, cars, vacations, etc. Piling another billion on top of what is already in their Money Bins doesn’t change their lives in any ways, but actually . . .
Their wealth hoarding is a transfer of wealth, real wealth, not inflated wealth, from the rest of us to them. They don’t feel their increase but we feel our decrease. As our lives become more and more diminished, the lives of the wealthy become more and more precarious. Since we do not have the money to buy the goods the factories of the fat cats are making, they move their sales over seas. But those markets aren’t as favorable as our rigged markets (rigged for our wealthy, that is). China is notorious for accepting factories of American corporations, then within a few short years, there is a native Chinese production facility in competition with them, and not just in competition with yours in China but in Europe and other places as well. China backs active espionage of “intellectual properties,” and protects startups from predation as they build up speed and capacity. (Hey, don’t get snooty, we did the same to Great Britain after our Revolutionary War.)
And the fat cats can’t fall back on the American domestic market (which used to be huge) because we Americans do not have the disposable funds we used to have. What we do have is debt. It is debt that enslaves us. At least we don’t have to go to work houses anymore, but our jobs have become much like those workhouses. We work and we work and we work and we don’t get ahead.
And, of course, the conservatives (and their political party, the GOP) are Social Darwinists. That they are wealthy is an indicator of their superiority on all fronts (business, political, religious, moral, etc.). That we are poor and massively in debt is an indicator of our inferiority on all of those same fronts. And they are not inclined to serve you via our government. You are not worthy.
So, prices will continue to go up, that is the way the system works. Unfortunately, your ability to pay those prices will shrink and shrink, and shrink. The system worked somewhat better in the past, but when the plutocrats bought our governments they no longer work for us, they only work for them.
If you do not believe me, look up what the 1960’s minimum wage would be worth today if it had been corrected just for inflation. Compare that with what the minimum wage is today.
The irony, of course, is that the plutocrats do not understand that if they hadn’t transferred all that unnecessary (to them wealth) out of our pockets, we would still be buying all the things they are selling, and they could continue to be “players” in “the game.” As it is is, they seem intent on destroying the game and most of us in the process.
Afterword The people on their side of the fence believe that there are only four things that can reverse wealth inequality: mass warfare, violent revolution, lethal pandemics, or state collapses. And those aren’t guarantees! The collapse of the Soviet Union (with meddling by U.S. by the way) caused a great deal of new wealth inequality. But World War 2 wiped out a great many monarchies and fortunes of the then rich and famous.
I am not fond of any of these but if they don’t listen to common sense advice, maybe a violent revolution is a quick fix. Or maybe someone will figure out how to target the uber-wealthy with a virus.