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Real world economics:
Poverty is coming to town
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by Mr. Chuckles, Unknown News
January 12, 2007
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Santa has come and gone, leaving behind a happy trail of memories and a bit of hope for the future... hope which may soon be dashed, and stomped into the ground for many of us.
2007 promises new squeezes on the "lower" and low-middle classes -- even as the politicians scheme to win votes and campaign contributions. Our main squeeze is pent-up inflation, now working its way up through the bottom of the economy. Also we face new stealth taxes, which absolutely must be regressive to have any chance of raising the necessary funds to pay for bloated bureaucracies and giveaways for the wealthy.
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The inflation scam is part of what you might call a monetary pyramid scheme. Supposedly it rose less than 4% last year. That might be true if you did not rent, drive, eat, use electricity, receive medical care or get yourself a college education.
My cost of living jumped about 8% last year, even without medical care or tuition. Your numbers are probably similar because we are at the stage of the economic cycle where the Federal Reserve tightens monetary conditions to fight inflation. That means that businesses and landlords now have "pricing power".
Here at the bottom of the economic food chain, inflation is much higher than the national average because, for example, a 10¢ price increase on a can of beans may amount to, say, a 20% increase due to the low price per can. Since rich people don't generally eat canned beans the national average consumer price increase tends to be less than that 20%.
Nickels and dimes add up really fast when you're on a budget. And when Dented Cans, Inc. and Big Lots raise their prices, the poor have no alternative. There is no place lower, and no more down to go -- except food banks and dumpster diving.
Fortunately, the politicians are raising the minimum wage in many states. But in places like California they're already taking back the wage increases with new tolls, fees and taxes. In the San Francisco bay area, toll charges on the bridges just jumped higher by $1. That amounts to a 33% price increase that the rich people driving their air conditioned SUVs won't even notice. But poor people will.
Also, Governor Arnold Schwarzenegger proposes to require every person in California to purchase health insurance. He claims that the state will help poor people pay for the insurance, but what about people that are just a bit above that poverty line? According to the Governor, those poor people are stealing from the everyone else by going to the emergency room and refusing to pay for treatment -- though we know for a fact that medical debts are turned over to collection agencies who will hound you to the fucking ends of the earth, or into bankruptcy. (It might be that "illegal immigrants" could skip out without ever paying their hospital bills, but for people with US citizenship, ID papers and entries in the government databanks, leaving town does not mean leaving behind one's debts... I mean, what the fuck are you going to do, move to Mexico?)
I think what happened is that Governor Arnold got healthcare "religion" after, in just one year, crashing his motorcycle and then breaking his leg in a skiing accident. Now he worries about hospital emergency rooms full of poor people who fell on the ski slopes, or who spilled their Hogs on the way to the office :-)
So, help is on the way in California, for the unfortunate members of wealthy classes whose health care premiums are unfairly high due to poor people without insurance! I am confident that the insurance companies will lower everyone's rates once the poor people are forced to buy insurance!
Tighten your belt, everyone else. It's going to get tougher before it gets easier! Hang in there...
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Here at the bottom of the economic food chain, inflation is much higher than the national average because, for example, a 10¢ price increase on a can of beans may amount to, say, a 20% increase due to the low price per can.
Since rich people don't generally eat canned beans the national average consumer price increase tends to be less than that 20%.
Nickels and dimes add up really fast when you're on a budget.
And when Dented Cans, Inc. and Big Lots raise their prices, the poor have no alternative.
There is no place lower, and no more down to go -- except food banks and dumpster diving.
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