Why Voters Are Pessimistic, Who Sells Groceries & Congressional Updates
Steve Dittmer | AFF Sentinel
Colorado Springs, CO
Originally sent to subscribers 04/11/24
D.C. Update for Thursday-The House is set vote Friday on a Foreign Intelligence Surveillance (FISA) bill, after an emergency Rule Committee reported out a revised version of the bill rejected Wednesday. The new version includes an amendment to be considered on the floor to add warrant requirements when investigating American citizens.
There was also a joint Congressional Review Act introduced to challenge new EPA rules on gas and oil wells.
The Senate passed a bill reversing the Federal Highway Administration’s mandates for states to begin measuring tailpipe CO2 emissions and set declining targets. The bill now goes to the House. Biden has promised a veto. Two federal courts have struck down the rules.
A recent story, some polling and a study by a Harvard economist examined how people are feeling about the economy and their situation. A little less than half thought inflation caused higher prices.
Dink, ding, ding, ding, ding. Correct.
An equal amount thought inflation was “price gouging” or “overpriced everything.”
No on gouging. “Overpriced” is the result, not the cause.
Although there is an effect in eras of continual inflation that causes companies to raise prices in anticipation of higher cost of goods the next month. Then consumers pay higher prices in anticipation of them being higher yet soon. That becomes a vicious cycle.
But the gist story headline in the Wall Street Journal was their poll finding 74 percent of people said inflation has moved the wrong way in the last year. The story took consumers to task for not correctly knowing the rate of inflation has slowed in the last year. In effect, they were reflecting their experience that most prices have stayed high or increased, even if increases have been at a slower rate. The story says peoples’ “vibes” are that the economy is not doing well, and that opinion differs from the inflation data.
Actually, we think their “vibes” dovetail perfectly with their bank accounts and their credit card balances, not the published rate of inflation or the national GDP.
Yet the Wall Street story gives citizens a hard time for going with their pocketbooks instead of realizing the inflation rate has gone down from 9 percent to the high threes to 3.5 now. It notes that voter sentiment is bad news for President Biden’s re-election campaign and “he can’t exactly tell voters they’re wrong.”
We disagree. He has done that on more than one occasion, including the State of the Union, claiming that the economy was booming. He did it again this week. He has said the economy was doing great but that people just didn’t realize it. Various surrogates have repeated that allegation, (“In Today’s Economy, Voters’ Vibes Battle With Clear-Cut Data,” 04/04/24).
It's no wonder Biden's credibility is zero and the general media's is not much better.
We think part of the data vs. voters’ pessimistic and frustrated attitudes -- as well as the experts’ difficulties in explaining a stronger-than-expected economy, the elusive recession or the Fed debating interest rate decreases -- depends on where a voter is in life the last three years.
If a family didn’t have to buy a house, didn’t lose a job, had enough income to not run up credit card bills, didn’t have a car and have to replace it, didn’t have a kid in college, didn’t get married or have a baby, their attitude would differ totally from one that had to deal with the dramatic difficulties of any or several of those things. Even in between those extremes, unexpected car repairs, medical bills, escalating insurance bills or needed travel could hammer a family’s budget, sometimes without warning.
Voters real wages, adjusted for inflation, have fallen almost three percent, another cause for discouragement.
The cost of food alone has put lots of pressure on families, both in eating out and buying groceries. The demand for beef in both arenas has felt the pinch but held up because of the point at which the cattle supply cycle is at a difficult economic time. Luckily, we have done a lot to improve our product over the years to weather this storm. But we got a text from a relative only this week asking why the price of steak was so high. If we did not have a high quality product and had a big supply of it, consumers would be happier but the industry would not.
Economists can point out that unemployment is low, the job numbers are up and the workforce participation rate has increased from 62.5 to 62.7 percent last month. But as several have pointed out, a major chunk of new jobs have been government jobs and in the latest data, part-time jobs were twice the number of full-time jobs created. The Federal Reserve has sat on interest rates because the data is so mixed and inflation is proving to be sticky and persistent.
Biden’s policies haven’t helped. A continual war on fossil fuels, now including halting new LNG permits, practically outlawing manufacture and sale of combustion engines and insisting on EVs for which neither consumers or the electric grid is ready for, piled on top of continually increasing government spending, helps neither economic growth or people’s attitudes.
The Wall Street article asked why people’s attitudes are so pessimistic and senses “a deeper pessimism about the country.”
We suggest people’s observations about loss of personal liberty, of government expanding control over their daily lives and vision of Congress spending more and ignoring the national debt might be affecting voters’ psyches.
Have you bought steaks or roasts at Walmart or Target? Evidently, no one at the FTC competition department has. We could talk about a federal agency being clueless…but we’d be repeating ourselves.
We don’t have enough information to know definitively whether the merger between Kroger and Albertson’s, parent of Safeway, would be anti-competitive or not. Supermarket margins have always been tight. Lots of convenience stores, gas stations and truck stops sell groceries. Grocery margins used to be less than one percent but supermarkets made money by turning over everything monthly. Margins went up when supermarkets began carrying more high margin, non-food items like light hardware, clothing, flowers, beer and wine, kitchenware, etc.
But in typical government fashion, the FTC is way behind the curve. Incredibly, the agency hasn’t yet caught on to the fact that Walmart or Target sell groceries. Natural food chains like Sprouts and the dollar stores that sell food also don’t count either in the FTC’s equations.
So the FTC opposes the merger by not counting the number one grocery seller in the U.S. as a competitor to the other supermarkets.
Next time: The Impossible Grid and Trade.
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