Over the past year or so, more and more Americans have been complaining about inflation, yet, on the surface, the usual statistics don’t seem to support those claims. But that’s only on the surface.
In September 2023, prices had increased by 3.7 percent compared to September 2022, according to the 12-month percentage change in the consumer price index, down from a monthly high of 9.1% in June 2022.
The problem with the statistics is that they only show the rate of price increases, not the comparison of real prices. For example, in October of this year food prices were up “only” 3.7%, but what that doesn’t reflect is the real pocketbook impact. The average cost of a pound of bacon was $5.34 in March 2020; today it’s around $7.25. That’s a 36% increase in two and a half years.
Gasoline prices have bounced around over the past three years, but even with recent price decreases, gasoline prices per gallon are 42% higher than three years ago.
For people who were already having trouble making ends meet, dealing with price increases often results in more credit card purchases. In March of 2022, the interest rate on the average credit card was 14.6%; today it’s 21.2%. With a credit card balance of $8,000 (the national average), the additional monthly interest expense is almost $50, or $600 annually.
At the same time, Americans keep racking up bigger credit-card balances. In the third quarter, the country’s credit-card debt burden hit a new record high of $1.08 trillion, according to the Federal Reserve Bank of New York. That was up $154 billion from the same period in 2022, the biggest year-to-year jump since the Fed started collecting the data in 1999. So, it’s scarcely surprising that, according to a national survey by WalletHub, 56% of all Americans say they have more credit card debt than they did 12 months ago.
All that has created, as the polls reveal, both a growing concern by most people about price increases and, apparently, a lack of understanding, particularly by Democrat politicians, who are looking more at the wrong statistics.