Prices are going up, people are complaining, and suddenly the joke of “in this economy?” is less funny. This week on Surly Voices, the hosts were joined by Benjamin Wilson and Scott Ferguson to discuss why everything is so expensive, where we’re going, and what it all means.
Listen to the full episode here:
Scott Ferguson, associate professor of the department of humanities and cultural studies at USF, said that there’s a false narrative is being spread: too much fiscal stimulus is causing the rise in prices. However, both guests reject that narrative. Rather, they would shift the narrative to a new lens, to create a better understanding.
Benjamin Wilson, associate professor of Econ at SUNY Cortland, explained one of the major issues with the current lens being used. This problem is that most people are using singular numbers or data points as references. They’re using the consumer price index and unemployment rates, and those really don’t capture the variability of things, and how it actually affects people in their day-to-day lives.
One of the largest factors driving up prices, Ben says, is used car sales. But, he says, he would argue that prices, in general, are not going up, it’s just the prices of certain goods and services. There is no ONE trend that fits all.
When looking at the consumer price index, the price of a ‘basket of goods’ is going up on average. However, used car prices are going up exponentially, and that’s bringing the overall average CPI up. But, they say, that doesn’t mean that everything is going up.
Wilson and Ferguson noted that the price of a barrel of oil, very recently, has gone back down to the levels “pre-shock”. However, the price of gas has not gone down. So releasing more oil and purchasing more oil isn’t necessarily going to lower the price of gas. It’s when the corporations decide to lower the price.
The dominant market structure in the US is not so much the open and free market, but rather the structure of oligopolies, where a core few run the industry and have pricing power over all of the others. Ben named Amazon and Walmart as being two monopoly powers that buy out others to prevent competition, and their power to do so also gives them the power to control market prices on numerous goods that they sell.
“It’s time for a 21st-century reinvestment and what we want the future of this country to look like,” Ben says. And while we’ve started down that path, Scott says, there is still a lot of work we need to do as a country.