[Previous entry: "New exploits"] [Main Index] [Next entry: "Full of Shat"]
02/17/2004 Archived Entry: "The Price of Bread"
Cartoon fix: Tom Tole's "We're Counting on it; Ted Rall's "The Evolution of War"; and, Drew Sheneman's "Defending the Military Records, Phase II".
My perception of the economy is increasingly at odds with the sunny updates and forecasts issuing from news stations. You know the ones...they are the same news outlets that spread confident accounts of the invasion of Iraq and the search for WMDs.
I don't base my conclusions on government data or press releases. I go by the price of bread and similar real world measurements. For centuries and everywhere, the price of bread has been a measurement used by common people and its rise has been a significant factor in political unrest leading to regime change. Years ago, President George Bush (Senior) was unable to answer the question, "What is the price of bread?" - (in 1990, BTW, it was 69 cents a loaf). His ignorance of this everyday reality was interpreted as a sign of being out of touch with the common needs of the average person. Clinton rode into the White House by keeping the slogan "It's the Economy, Stupid" posted in front of his aides and volunteers as a way to remind them that average people care more about the immediate financial well being of their families than they do about abstract issues, like the environment.
The price of bread has not fared well since 1990. On the Catholic Information Network discussion list of July '98, one poster stated, "In Kansas city, the price of a one pound loaf of whole wheat bread is $1.99 at the supermarkets. This would be some kind of national brand. Italian and French and whole wheat loaves, baked in the store, run 99 cents to 1.79. Milk is $2.59 a gallon this week." A Canadian replied, "I always want to know the price of things in other places. I never pay more than $1.00 Canadian (60 cents US) for a loaf of bread. I often get one for 68 cents Canadian, or about 40 cents US. I am curious to see the prices elsewhere."
The loaf of whole wheat bread Brad and I bought in a local grocery store two weeks ago was $2.20 Canadian (1.60 US). True, on this occasion we did not comparison-shop nor did we choose the cheapest alternative; we just bought a fairly standard loaf. But the "lesson", the author's message: the price of bread in Canada has more than doubled within the last six years. Many factors could contribute to such an increase but one deserves special mention: inflation.
In the economic bust of the `70s, everyone acquired a quick education in economics, which included the insight: inflation occurs when the money supply increases without a corresponding increase in goods. This means that the buying power of every buck in every pocket declines; the price of goods goes up. I don't know how much the Bush administration has increased the money supply, and I don't think anyone who's talking about it knows either. But phrases like "a whole hellacious lot" or "Biblical proportions" probably do not begin to capture the scope of the inflation over the last three years. And the devaluation of the currency is hitting the price of food on tables, even here in rural Canada...
For a number of reasons: Canada has hitched its monetary policy to that of the States because it wants to track the greenback. Or, at least, not get too out of synch. When the Canadian dollars rises, many industries on this side of that imaginary line called "The Border" dry up. For example, Toronto has a booming film and TV industry that is largely sustained by US producers drawn Northward by the city's NY atmosphere coupled with cheap prices due to the lower Canadian dollar. Raise that dollar and production companies pack their ever-so-portable bags for elsewhere. Moreover, the line between the two nations is largely imaginary..at least, economically. (But not so imaginary that draft dodgers may not be welcomed, again, in a few years.) Economically, Canada is tied to the States with spousal intimacy, especially when it comes to trade. Which spills over both to the cost of goods and to money policy, even considered as separate categories.
I'm seeing inflation reflected in the spiraling prices we are paying for food and for other necessities. Gas is another instance. It is now typically .71 cents a litre, which is high by past levels. But the amazing thing is that - in adjusted dollars - .71 cents a litre is in line with the price of gas in New York or Illinois. Canadian gas used to be tremendously more expensive than what we purchased State-side. Not any more. Bush's inflationary policy is economically crunching the average guy and gal - both in the US and in Canada, but hardest in the States -- who are trying to feed their families.
(BTW...the price of bread worldwide is an interesting topic. Ambrosia, a Greek blogger, recently posted, "Today, I finally got a price jolt from my loaf of bread. It is white sliced bread in a bag containing 20 slices. This morning, I bought just one loaf and the scruffy lady at the cash register rang the thing and said: "1.89". That's 1.89 euro, i.e. roughly $2.41 [US]. Then my mind went back to the old drachma. At the fixed rate of 340.75 drachmas to the euro, my loaf of bread cost 644 drachmas. That is to say, each SLICE of my loaf of bread (remember, there are 20 slices in the bag) costs 32.20 old drachmas (!) Just before we were ushered into the European "miracle", a loaf of bread from the bakery (half a kilo) was anywhere from 75 to 120 drachmas. Sliced bread was slightly more expensive, perhaps 130-140 drachmas. But nobody, not even the worst profiteer in the entire country, actually contemplated selling ONE loaf of sliced bread for 644 drachmas.") I don't know of any book that correlates the price of bread and political unrest...but, if it doesn't exist, it should.
Best to all,
mac