This is a follow-up to my comments in the letters column printed the week of June 26th in which I pointed out that we were doing quite well when it comes to poverty.
The poverty level in 1972 was $4,137 and the poverty level for 2013 was $23,550.
Wow! Big difference. But, let’s take a moment and connect the dots to see what we have.
By golly, what we have is the monster of inflation. Inflation eats all but the very rich alive and spits out the bones of older retirees and the middle class.
OK, so, what causes inflation? Here goes:
1. Higher wages.
2. A shortage of a product allows companies to raise prices during higher demand. Prices drop when there is less demand.
3. Government spending. When government prints more money than we have, the value of the dollar goes down as we have seen in recent years. This means it takes more dollars to buy a product whether food or a refrigerator.
4. Government regulation. Business spends more to comply with regulations and tax laws than they actually pay in taxes. Obviously, this is a ridiculous situation and business passes the extra cost on to the rest of us. Government-induced inflation where only accountants and lawyers get rich.
Some say that inflation is good for an economy and to some degree this is correct but that view fails to recognize many millions suffer from the effects of inflation which includes the poor and middle class who struggle to make ends meet. In the current political mindset, let the others, who built this country, pay the price and suffer so that we can favor some other group.
Politics and economics are like oil and water, they don’t mix. There are as many economic theories as there are economists and even more unfortunate is that the current administration is basing their economics on outdated theories that should have been tossed out long ago.
The administration wants to keep more people off the road for a variety of reasons and we see this in their refusal to allow more drilling for oil or even bringing in the Keystone XL pipeline. (Canada, as you may have heard, is going to sell their oil to China) As we saw in the ’80s there was a glut of oil and prices were extremely low. But now, government policy is to keep prices of oil artificially high to keep us off the roads or push us to buy electric automobiles, or ride bicycles.
President Obama sees the influx of immigrants as a way to build loyalty amongst the Latino base who will vote for Democrats but it also means American born workers are not being hired at fair wages.
So, there you have it. Inflation remains the dragon in the closet and politics with a growing bureaucracy just adds to the problem. Maybe this is why some view politics as a form of mental illness?
Bob Wilson — Franklin, N.C.