WASHINGTON, DC, Dec 21 — The good news is inflation slowed down a bit; the cost of living rose just .1% in November. The bad news is that “price levels remain quite elevated compared to a year ago for many categories, and these high prices continue to put pressure on household budgets and force trade-offs with purchasing decisions,” according to Kayla Bruun, an economic analyst at Morning Consult.
And here is even worse news: it is America’s hapless senior citizens who are hardest hit. Dennis O’Connor, an 82-year-old retiree from Temecula, CA, put it this way in an article in the Epoch Times, “When the last events occurred 40 years ago, we were employed. The overriding concern is we cannot plan retirement a second time. When you are younger and working, you can recover. Retirees will never have that option.”
PayingforSeniorCare.com, which tracks financial resources for seniors, recently published the alarming results of a survey conducted among 1,000 seniors 55 years old and older. Forty percent of them said “They are worried that they won’t be able to afford food and groceries in the future due to inflation.” Ninety-four percent of them said that the price of food, in particular, is of concern and 20% of them said the cost of food has increased by $250 or more per month.
It’s report on the poll noted that, “When looking to the future, 43% say they’re worried they won’t be able to afford food and groceries, and 23% are concerned they may have to skip necessary medical procedures due to inflation…This report reveals that seniors have been hugely impacted by inflation and are very concerned about its impact on their future plans.” What are seniors most worried about? The top of that list is food and household necessities and it’s no surprise that their second concern is the cost of gas for their cars. More than 25% of them are worried that they will not be able to pay for needed medical care.
The rate of inflation in January 2021 when President Biden took office was a very manageable 1.4%. In the ensuing months, the rate doubled and then doubled again ultimately reaching more than 9% in July of 2022. It remains above seven percent. There’s a consensus that it will come down in time — the next few years or so.
A new analysis by Tyler Cowen, a professor of economics at George Mason University, published in the Washington Post states that “Consumer prices rose less than expected last month, and inflation rates are expected to fall over the next few years as well. That makes the debate about the appropriate inflation target for the US Federal Reserve all the more important: Should the central bank strive to retain inflation rates within the range of 2%, or should it stop at some higher rate, say 3% or 4%? Prominent macroeconomist Olivier Blanchard, among others, has suggested a 4% target. To my way of thinking, however, the risks of a higher rate of inflation — especially the consequences for workers — outweigh the benefits.”
However, as threatening as the current inflation crisis may seem, more bad news concerning our fiscal future comes from yet another prominent economist, Nouriel Roubini, Professor Emeritus at the Stern School of Business, New York University. He is quoted in a recent Epoch Times report as saying the U.S. faces what he calls “The mother of all economic crises…[a] deep, protracted recession.” Inflation is “eroding real household income and reducing the value of household assets, such as homes and stocks.” And, he says “The same goes for fragile and over-leveraged corporations, financial institutions, and governments: they face sharply rising borrowing costs, falling incomes and revenues, and declining asset values all at the same time.”