Is there a world food-price crisis? Yes. Is there an American food-price crisis? Hardly.
Steven Malanga from RealClearMarkets reports that American grocery prices are not inflating at an egregious rate–they’re just catching up for years of relatively low inflation. Specifically, he says, we just lack context and have been spoiled by years of increasingly cheap food prices:
Over the last several decades groceries have been one of the real bargains in America, and the average rate of inflation on dozens of food items tracked by the U.S. Bureau of labour Statistics has consistently been less than increases in the purchasing power of the average American family. As a result, the percentage of income that families devote to their food purchases has fallen sharply since the food inflation of the 1970s, even though more and more Americans (like Sen. Schumer’s family, judging by his testimony) have opted for buying more premium-priced items, like organic foods. Recent price spikes have done little to reverse years of moderation in the cost of food,
While recent food (and gas) price hikes have been hard to stomach for most Americans, simple lifestyle changes may be the remedy. This is one reason why premium food retailers such as Whole Foods Market (WFMI) may continue to get smacked.
Say so long to your organic premium label food item and your SUV for now.