It’s no secret that the United States is a victim of inflation. Remember when the cost of products at the Dollar Tree was actually a dollar? Prices are going up, value is going down and the cost of programs like higher education and healthcare are skyrocketing to new levels.
The Consumer Price Index (CPI) reports that price inflation in the U.S. took a surprising turn for the better in February. Prices only rose by 0.2 percent, less than January’s 0.3 percent or the 0.3 percent experts predicted February to entail.
But 0.2 percent is still too much and total price inflation doesn’t account for individual factors.
Egg prices, for example, have seen a 10.4 percent increase over the last month alone. Due to the nationwide shortage of eggs, prices increased to accommodate increased labor and transportation costs. As the egg shortage is predicted to end this spring, the U.S. can expect a decrease in egg prices in the coming month.
Increased labor and transportation costs are a massive factor behind all categories of inflation – as our population grows, there is a higher demand for items, food, healthcare and more. When this demand outpaces supply, prices tend to rise.
This can be seen in America’s college tuition crisis. According to the Education Data Initiative (EDI), college tuition is forty times more expensive than it was 60 years ago. For the past half-century, the population of higher education teachers has been on a steep decline, as people look for a better-paying job to combat the rising prices of inflation. Since there are not enough teachers, classes get more expensive, which contributes to the high tuition costs of college education.
Another important factor behind inflation is supply chain disruptions. Remember the 2020 shortage of toilet paper? The pandemic has caused significant disruptions in the global supply chains, causing manufacturing shutdowns, shipping delays and port congestion.
Geopolitical conflict isn’t helping. Events like the war in Ukraine have disrupted the production and trade of goods in Europe and many ports are unsafe and blocked off.
Donald Trump’s second presidency is also raising questions regarding his proposed tariffs. If the U.S. increases tariffs, a government-imposed tax on the imports of goods from other countries, fewer goods are sent over as countries do not want to pay these tariffs. If fewer goods are sent over, prices of said goods will increase due to higher demand and inflation rates will increase with them, weakening economic growth.
Inflation is only continuing to drive prices up and it’s up to today’s generation to stop the economy from relapsing into another great depression entirely. The best thing you can do is buy things second-hand, make things if you can and try not to make too many unnecessary purchases.
