(Brad Polumbo) The most widely-used metric for price inflation hit a 12-year high in mid-May, showing that prices had risen 4.2 percent over a year. But some argued this was just a one-off outlier, not indicative of a broader trend or serious problem stemming from runaway government spending and money-printing.
by Brad Polumbo, May 31st, 2021
Their case just got a lot weaker. New figures released today by the Commerce Department offer even more corroboration that prices are seriously on the rise.
Another key inflation metric, the core personal consumption expenditures index, exceeded expectations and came in showing a 3.1 percent year-over-year increase in prices. If you factor in energy and food prices, the inflation figure rises to a whopping 3.6 percent.
A key U.S. inflation gauge rose 3.1% year over year, higher than expected https://t.co/oiSCnvak3F
— CNBC (@CNBC) May 28, 2021
It’s also worth noting that this index and others like it notoriously underestimate inflation.
Where is this inflation coming from? Well, at least in part, it stems from the Federal Reserve’s money-printing to fund COVID-19 “stimulus” efforts.
The problem with these inflation levels, which are still far short of truly catastrophic hyperinflation, is that they erode your savings and purchasing power. The money in your bank account or under your mattress is worth less now. And unless your income has risen more than 3-4 percent this year, you’ve really had a pay cut, because what ultimately matters isn’t the number on your paystub but what it can buy you.
Simply put, public policy is all about trade-offs. And the downsides of government largess include more than just the traditional check you write to the Internal Revenue Service. When mounting price inflation erodes your paycheck, that too is a form of indirect taxation you can trace back to Washington, DC.
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About The Author
Brad Polumbo (@Brad_Polumbo) is a libertarian-conservative journalist and Policy Correspondent at the Foundation for Economic Education. His work has been cited by top lawmakers such as Senator Rand Paul, Senator Ted Cruz, Senator Pat Toomey, Congresswoman Nancy Mace, Congressman Thomas Massie, and former UN Ambassador Nikki Haley, as well as by prominent media personalities such as Sean Hannity, Ben Shapiro, and Mark Levin. Brad has also testified before the US Senate, appeared on Fox News and Fox Business, and written for publications such as USA Today, National Review, Newsweek, and the Daily Beast. He hosts the Breaking Boundaries podcast and has a bachelor’s degree in economics from the University of Massachusetts Amherst.
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Source:
https://www.shtfplan.com/headline-news/we-just-got-even-more-proof-inflation-is-on-the-rise
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