askyermom

I am not an economist, but I can do math and I can share my math thoughts and you cannot stop me. Do you want to read real economics instead of opinion? Why are you here? Currently, I am a little bit cranky, made of opinion, Sriracha and ethical tuna–that’s the budget these days.

Years ago, I read a finance book proclaiming that inflation isn’t real. Their argument was that while some items become more expensive in the current, um, currency, others become less costly. This is an irritating hypothesis. We can see prices going up, but maybe it’s something else at work. Inflation is a popular scapegoat, but is it really to blame?

Their example of price deflation was electronics. I remember when a pocket calculator cost $20 because I got three of them for Christmas. Now, about 50 years later, you can get a far superior pocket calculator for $4. You can also get a kitchen full of gadgets for similarly outrageously low prices. (Never mind that nothing lasts like it did in the mid 20th century. We’re just trying to keep this comparison simple, dollars to apples).

I decided to investigate my first budget compared to the present day to see where the real gouging is happening. Can you guess? It is not eggs or oranges.

In the early 1980s, I thought if I could earn $20,000 per year, I would be set. My monthly rent was $400, my car had cost $300 used, and I was able to take a modest pleasure trip each year and buy a book every week. It was pretty great; for a brief time I felt that while I always had problems, I didn’t have money problems.

The numbers suggest that nearly all my basic figures have tripled in the last 40 years. My total work compensation is about 300% more for a coincidentally very similar job. My housing costs are also 300% of 1984, which I consider very lucky. Finding a decent home for $1200/month isn’t easy around here and impossible in other places.

Oh. Wait. When I look at my old neighborhood it’s $1800 there for a dive, so that’s 450% of the 1984 cost for a two bedroom with marginal management. My old neighborhood was not fashionable, but it was close to D.C., which is enough to offer it gentrified pricing all these years later. Huh.

I doubt that anyone can get a reliable bucket of bolts to drive for $900 or even $3000, so that doesn’t track. My particular 1965 model car is out there for $27,000 on average and causes $28,000 worth of pollution every year. (Likewise, gasoline and milk are the poster products for price fixing and unrealistic fluctuations, so we’ll ignore them, too, because we can).

Books cost about the same(?!?) , which makes me embarrassed to groan about dropping $30 on a new hard back once in a while. The physical quality of the books has declined to keep the prices low. Sadly, I can’t see today’s mass paperbacks surviving far into the future. In my little home library, I have books for most every decade back to the 1850s, which are wondrously delicate and still readable, except for one “Child’s History of England” that may crumble to dust upon opening. The 1970s pulp paperbacks are still readable, if you can read while sneezing.

Food and hair cuts follow the 300% curve, but the outliers are interesting: cable was a high-priced luxury in 1984, but a phone line cost $20 per month. Long distance calls were extra, but you could receive far away calls for free on your $20 line. My current Phonertainment is anywhere from 800% to 1000% more each month.

I do not have cable; instead I have the weird hodgepodge of streaming that many of us have. It used to seem like a savings to cut out cable, but the providers have clawed back their fees over time by bundling and re-selling our stuff to us and blaming inflation for their need to take a bigger bite.

Having many streaming services isn’t strictly an improvement. It’s disorienting to have so many providers. We have to wonder, what was that new show with so and so? Will we ever find it again? Sometimes I pay for movies I already paid for because I don’t want to try to figure out how to connect a media player to my situation. So decadent.

Someone has figured out how to make this seem like a bright idea. Will I have to pay rent for my own brain in the future? Will it cost more than Netflix?

Fancy health insurance was $31 every other week in 1984 Maryland. The minimal health insurance I have now is 16 times more for 16 times less confidence in its coverage. Last year we spent $17,000 on health premiums and out-of-pocket for two healthy adults. I refuse to calculate how many excellent dogs I could have supported with those funds, but it’s a shame and a scandal to charge old people so much for just being old.

[I have deleted a whole ‘nother essay on Strugglenomics here, which will probably get published sooner rather than later].

The thing is, I cannot stop thinking about how much mental punishment I have inflicted on myself about being on the underside of middle class at this late date. It helps to remember it’s not my fault. I worked long years and supported a great many other people to arrive at a place where I probably cannot fully retire until I die.

I noticed during all those years that exploiting people seemed to be the key to building wealth and my unwillingness to lean into that method cost me. Maybe. Maybe I would never have been an effective, ruthless entrepreneur. I cannot even see that splinter of reality when I squint.

My imaginary businesses are all things like delivering flowers to widows or boosting young moms in tough spots, so none of my ideas are serious profit centers.

I guess I don’t really care if inflation is real. It’s enough to understand that as costs go up incomes need to go up too. Some people seem to have trouble remembering that tiny bit of math. Don’t be those people.

Love,
yermom

My new book Don’t Eat Your Children is available at most retailers for mail order. Try this one: Bookshop.org. If you subscribe to my newsletter or my substack, you will be in the loop for whatever comes next, like paperbacks.