Inflation in the United States is currently at 6.2 percent year over year, but there are answers.
Many families are looking for methods to save money this Thanksgiving season as costs climb. NBC, thankfully, has the ideal solution: don't purchase a turkey. In fact, if you're truly strapped on cash, Washington Examiner editor Seth Mandel recommends avoiding Thanksgiving entirely.
Consider sitting alone in your basement with the lights off this Thanksgiving https://t.co/8pCck4vdD3— Seth Mandel (@SethAMandel) November 22, 2021
Apart from the joking, it's difficult to dispute that inflation has an influence on our lives in a variety of ways. But, in order to grasp what's behind it, we need to first define what inflation is.
Inflation is defined as a rise in an economy's overall price level. It should not be confused with a price increase in a short period due to increased demand, relative to supply, as in the case of the introduction of a new version of a product like an Xbox, or reduced supply, relative to demand, as in the case of computer chips for automobiles, due to supply chain problems.
"Inflation is always and everywhere a monetary phenomena in the sense that it is and can be caused only by a more rapid rise in the amount of money than in production (goods, services, and other assets)," wrote Nobel Laureate economist Milton Friedman.
President Biden claimed in 2020, while campaigning for the president of the United States, that "Milton Friedman is no longer in command." This is hilarious considering that ten months into Mr. Biden's presidency, he is presiding over the greatest rate of US inflation in more than thirty years (caused by substantial increases in fiscal and monetary policy from his and the previous government).
On the 15th anniversary of Dr. Friedman's death, Bill McGurn wrote in The Wall Street Journal, "Friedman appears to be gaining the last laugh on the topic of inflation," making the University of Chicago legend as relevant as ever. This is especially relevant now, since Friedman's alternative characterization of inflation as a "painful tax" comes to mind. Inflation diminishes a person's purchasing power because more dollars are pumped into the economy compared to production, making each dollar less valuable and disproportionately affecting the poor!
Inflation and the Celebration of Thanksgiving
Current year over year inflation in the United States is running at 6.2 percent with states like Michigan running at roughly 6.5 percent, slightly higher than the national average.
There's a lot of discussion over whether this inflationary rise is temporary or permanent, and how much of our present rising pricing is due to supply chain failures and/or increased demand for a popular product or service. Or if it is mostly due to excessive government spending and monetary policies employed to combat the pandemic, as experts such as Milton Friedman would argue. The Federal Reserve's injection of more than two trillion dollars into the economy in the previous two years, together with upwards of eight trillion dollars more earmarked or under dispute to be spent, may undoubtedly be seen as the primary cause of today's inflation rise. Friedman's explanation of why prices are rising across the economy with no general reason other than more money chasing the same or slightly more commodities and services is undoubtedly validated by this extra liquidity in the capital markets.
As Thanksgiving approaches, our research predicts that Americans will pay more ($53.94) for a traditional Thanksgiving dinner for ten, which includes turkey, bread stuffing, sweet potatoes, buttery rolls, peas, cranberries, a relish tray of carrots and celery, pumpkin pie with whipped cream, coffee, milk, and/or water to drink. According to Statista, this price is 15% more than last year's 10-year low of $46.90 and 9.87 percent higher than the previous 10-year average of $49.10. To make the feast more reasonable, many Americans will swap chicken for the traditional turkey (turkey prices have increased by 20 to 24 percent).
We can see that the price of Thanksgiving meal supports Friedman's theory that inflation is a monetary phenomena created by excessive government monetary and fiscal policies, with only a tiny increase in pricing around Thanksgiving owing to supply chain issues.
In addition, in 2021, the expense of traveling and spending Thanksgiving with family or friends will be significantly greater. According to current national averages, gasoline has increased by 61%, hotels have increased by over 15%, airline tickets have increased by over 24%, rental cars have increased by roughly 86 percent, new cars have increased by 9.8%, and the cost of used cars, SUVs, and trucks has increased by almost 26% year over year.
As a result, if you go for Thanksgiving, your total expenditures will be significantly greater.
Let’s not forget why we celebrate Thanksgiving
We hope that Americans focus on the true meaning of Thanksgiving at this time of year. Thanksgiving has been a time to reflect on the many blessings, good times, and people in our lives who have made a difference, and to give thanks that we are very fortunate to be citizens of the greatest country and economy in the history of the world, from the first Thanksgiving in the 1600s in Massachusetts to modern times.
Most essential, we should not just be grateful for what we have, but also consider what we can do now and in the future to better the lives of others. Acts of kindness, such as assisting a family member or neighbor, community work, or, if possible, a cash present to a house of worship or local charity, should be considered now more than ever.
We hope that every American has a happy Thanksgiving and looks forward to a brighter future. Many more individuals will need to rely on Thanksgiving charity in 2021, with inflation at a 31-year high... As a result, we must all try our best to make others' Thanksgivings better this year while also making our own Thanksgivings better!
Finally, for the sake of a brighter future for the United States, it would be prudent if Milton Friedman resurfaced in the White House and the corridors of Congress in the near future.
That is unquestionably preferable than not purchasing a turkey!