so basically $150,000 a year...and I know couples where both are nurses....
how can people on fixed incomes keep up with this....we can't....
I’ve argued that very point with some on FR. The response was usually some form of, “But inflation is out of control; we need higher wages to keep up.” And THAT is the attitude that makes the inflation problem into an inescapable trap. Rising prices are bad, but trying to match them by inflating wages creates an inflationary spiral that is FAR worse.
Everyone knows that inflation is caused by “too many dollars chasing too few goods.” Well then, when you’ve already got government-induced supply shortages of various kinds causing inflated prices, how in the world does anyone believe that putting even more dollars artificially into consumers’ pockets will stop that inflation? On the contrary, it will only cause MORE inflation, causing demands for even higher wages, which will just cause prices to spiral ever higher, ad infinitum until we become the Weimar Republic or Venezuela, where you need a wheelbarrow full of your devalued currency to buy a loaf of bread. Higher wages are not the answer. In fact, so long as the government keeps meddling and causing prices to skyrocket the only counter to that is to keep wages where they are (or lower) and to probably lay off a lot of people as well. The Fed is currently trying to reign back in the inflated money supply (very tepidly) through interest rate increases, but that doesn’t look like it will be enough. It will probably take a serious recession, because one way or another demand MUST be tamped down.
Of course, it would be far preferable to just get the government to take their grubby hands off the neck of the energy industry, in particular, stop over-regulating everything, and especially stop injecting trillions of “printed” federal dollars into an already inflated economy, but that won’t happen anytime soon, so we’ve got to slow down demand. As you point out, those on fixed incomes will be absolutely destroyed if wages are allowed to spiral upward, but it won’t be good for those receiving the raises either, in the long run. It will just create even bigger asset bubbles, as well as non-stop price inflation, until the whole thing finally collapses in spectacular and devastating fashion.
You can’t make people prosperous by just giving them more money artificially. If we gave everyone in the U.S. a million dollar per year salary starting tomorrow, it wouldn’t make them wealthy. It would just reset the baseline for the entire economy and very quickly it would take a million dollars per year just to scrape by, while anyone who didn’t receive that inflated wage (think: retirees) would be left behind to starve. The only exception to this is if wage increases occur because of increased PRODUCTIVITY, but that’s not what people are clamoring for now. They just want more money because prices are increasing. That’s understandable, but will be catastrophic if we give in to that demand.
Just look at what third-party money, in the form of easy grants and loans, has done to the price of “higher education.” Then imagine how different the situation would be if we didn’t fall for the emotional pleas for financial assistance and instead forced everyone to pay for college themselves, out of their own pockets. In that scenario, the colleges and universities would have to price their product according to what people could afford to pay directly, and the cost would fall dramatically as a result. The same dynamic of “easy money” from third parties (mortgage lenders) caused the last housing bubble collapse and the financial crisis of 2008. More money is NOT the answer, it’s part of the problem.