Owl Light
Where Inspiration & Inquiry Converge
  • Home
  • Literary Journal
  • Owl Light Sponsorship
  • Digital Owl
  • Contact Us
  • Login
  • Home
  • Literary Journal
  • Owl Light Sponsorship
  • Digital Owl
  • Contact Us
  • Login
  • Home
  • /
  • Democracy
  • /
  • Human Rights

Save Inflation for Later

  • OPINION – KURT STAUDTER

– Christmas shopping this year is costing a little bit more, but it’s not just holiday shopping, buying the weekly groceries is taking a bigger bite out of our wallets.

The right is waving the red flag of inflation, and making the argument that by increasing government spending during the pandemic we’ve lit the fuse on another recession. With inflation fears on the rise, and another big government package in the offing, should we be concerned?

When anyone talks of inflation I always conjure up images of Germans before WWII taking wheelbarrows full of Deutschmarks to buy a loaf of bread. That’s what inflation does, at the same time it devalues your money while prices on everything rise. By giving everyone in the country extra money to spend during the pandemic, some experts argues that it’s caused inflation. Traditionally, the response to inflation by the Federal Reserve is to raise interest rates. Fed chair Paul Volker did this in the early 1980s and we saw interest rate soar to above 18%, and then we watched one of the worse recessions since the Great Depression. It would take years to climb out of that hole.

I may be wrong, but I don’t think what we have going on right now is regular inflation. Inflation tends to affect all parts of the economy, and this isn’t happening right now. Sure, fuel prices are going wild, and because of a rise in transportation costs, groceries and meat are on the rise. One could make the argument that fuel costs have been below market for a long time and this is just a correction.

When we have true inflation we see it everywhere, yet we’re not seeing a rise in the cost of services. It’s like they never got the memo, or more than likely, it’s fallout from the pandemic – People are still not ready to risk COVID exposure by getting one-on-one personal services. By all indicators, people have not returned services to pre-pandemic levels, yet the purchase of goods has exceeded pre-pandemic levels. Instead we’re seeing people buying things, and ironically, since we don’t make things in this country anymore, because of supply chain issues, the cost of things are going up.

Now, is it because of inflation, or is it more because of simple supply and demand constraints? One thing is for sure, the COVID has been responsible for every price increase since the pandemic began. Lack of workers, interruptions in supply networks, and shortages of raw materials, the COVID is wreaking havoc on the international economy.

As more Americans get vaccinated and return to spending on services, we should see a return to lower prices as we stop buying things and facilitate the normalization of the supply chain while using more services. Also, as we move closer to living with the COVID we’ll figure out what the new normal looks like. The one thing markets hate is uncertainty, and right now we’re awash in the unknown.

Now the Republicans believe that inflation is out of control and the pending Build Back Better bill will be like feeding gasoline to a fire. I disagree with this assessment. Think about it: The bill contains ways of addressing housing costs, medical expenses, fuel prices, and childcare, all among the biggest expenses in any household. By lowering the costs of all of these things through government intervention one would hope that it would knock back inflation as well. It would seem that raising interest rates isn’t the only action the government can take.

For example in Vermont rent can be raised with a new lease, or with monthly renters, rent can be raised with 60 days notice. Nowhere in Vermont law is there a limit on how much rent can be increased. If you want to take pressure off households, put a cap on rent increases, and that could even be done at the municipal level.

Another example of what we can do is with the Green Mountain Care Board. Instead of tweaking increases in health insurance and hospital budgets, perhaps the GMCB can act like the regulator it’s supposed to be and just once in a while say no to price increases. It turns out that the government has lots of tools to combat inflation and they should use them.

Finally, the move away from fossil fuels will in the long run lower energy costs but it’s going to take time. Meanwhile, lots of Vermonters make use of LIHEAP (Low Income Home Energy Assistance Program) and by expanding eligibility it will go a long way to help more families get through winter.

Should we fear out-of-control inflation? Yes, but Democrats have to stand up to the Republicans that have made a weapon out of inflation, and make the argument that we need to make these investments in the American dream for millions of Americans. For too long our government has been the best money can buy, and the big spenders have been the rich and corporations. Now is the time for a large dividend for the citizens.

Posted on December 19, 2021 by owllightnews.com. This entry was posted in Democracy, Human Rights and tagged #inflation, #Opinion. Bookmark the permalink.
The Non-profit Arts and Culture Sector Receives $45 Million In Critical Funding
Christmas Spirit

    Recent Posts

    • Visual Studies Workshop Announces Project Space Residency Open Application Period
    • West End Gallery showcasing Brian S. Keeler, Treacy Ziegler
    • Hard
    • Eye-Magine – Future Youth Art Exhibit
    • “These Wilds” Announcement

    Recent Comments

    • Darlene on Let’s Talk About Beep!
    • Darlene Bentley on Hello! from a new Guest Editor, and Finding Joy in Hardship.
    • owllightnews.com on The Farm
    • Douglas Morgan on The Farm
    • owllightnews.com on Energizing and Engaging Fun at GEVA

    Archives

    • May 2025
    • April 2025
    • March 2025
    • February 2025
    • January 2025
    • December 2024
    • November 2024
    • October 2024
    • September 2024
    • June 2024
    • May 2024
    • April 2024
    • March 2024
    • February 2024
    • January 2024
    • December 2023
    • November 2023
    • October 2023
    • September 2023
    • August 2023
    • July 2023
    • June 2023
    • May 2023
    • April 2023
    • March 2023
    • February 2023
    • January 2023
    • December 2022
    • November 2022
    • October 2022
    • September 2022
    • August 2022
    • July 2022
    • June 2022
    • May 2022
    • April 2022
    • March 2022
    • February 2022
    • January 2022
    • December 2021
    • November 2021
    • October 2021
    • September 2021
    • August 2021
    • July 2021
    • June 2021
    • May 2021
    • April 2021
    • March 2021
    • February 2021
    • January 2021
    • December 2020
    • November 2020
    • October 2020
    • September 2020
    • August 2020
    • July 2020
    • June 2020
    • May 2020
    • April 2020
    • March 2020
    • February 2020
    • January 2020
    • December 2019
    • November 2019
    • October 2019
    • September 2019
    • August 2019
    • July 2019
    • June 2019
    • May 2019
    • April 2019
    • March 2019
    • February 2019
    • January 2019
    • December 2018
    • November 2018
    • October 2018
    • September 2018
    • August 2018
    • July 2018
    • June 2018
    • May 2018
    • April 2018
    • March 2018
    • February 2018
    • January 2018
    • December 2017
    • November 2017
    • October 2017
    • September 2017
    • August 2017
    • July 2017
    • June 2017
    • May 2017
    • April 2017

    Categories

    • #2021
    • Agriculture
    • Animals
    • Antiques
    • Art
    • Astronomy
    • automobiles
    • Beekeeping
    • Birthday
    • Boating
    • books
    • Botany
    • Broome County
    • Buffalo
    • Canadice
    • Canandaigua
    • Cartoon
    • Children
    • Civics
    • Collecting
    • Comic Strip
    • Community Information
    • concert
    • Covid-19
    • Creative non-fiction
    • Dansville
    • Death
    • Democracy
    • Dogs
    • Editorial
    • Education
    • Environmental
    • Essay
    • Family Fun
    • Fantasy
    • Fiction
    • film
    • Finger Lakes
    • Food and Beverage
    • gallery
    • Gardening
    • Gender Rights
    • Great Lakes
    • Health
    • History
    • Holiday
    • Honeoye
    • Human Interest
    • Human Rights
    • In Memoriam
    • Innovation
    • Interview
    • Leisurely Pursuits
    • Literary Arts
    • Little Lakes
    • Live Theatre
    • Livingston County
    • media
    • Monroe County
    • Movies
    • Museums
    • Music
    • Naples, NY
    • Nature
    • Night Sky
    • No. 1
    • NYS
    • Obituary
    • online
    • Ontario County
    • Opinion
    • Outdoor Sports
    • OWL Light
    • Owl Light News
    • Owl Light Newsstand locations
    • Owl Light Sponsor
    • Owl Sponsor
    • OwlLight Blogpost
    • OwlLightNewsArchive
    • Performing Arts
    • Photography
    • Poetry
    • Politics
    • Press Release
    • Recipe
    • Reviews
    • Richmond, NY
    • Rochester
    • Satire
    • Science
    • Scifi
    • Seniors
    • Shop Local
    • Social Justice
    • sports
    • STEM
    • Steuben County
    • Sustainability
    • Theatre
    • Tioga County
    • Tompkins County
    • Travel
    • Uncategorized
    • Veterans
    • Weather
    • Women's Rights
    • Wood working
    • writing
    • Wyoming County
    • Yates County
    • Young Adult
    • youth
    • Zoom

    Meta

    • Log in
    • Entries feed
    • Comments feed
    • WordPress.org
Powered by