The U.S. Economy is Doing Well Despite the Whiners

The media feeds us story after story of how the American people are suffering because of the state of the U.S. economy. It is mostly driven by recent price increases. We are told that the average American family is being “crushed” by increased food and gas prices. These stories are reinforced by selective interviews with people who talk about the severe impact increased costs are having on them.

On the other hand, the hard cold economic facts suggest that both the economy is strong and the impact of the current run of price increases is relatively modest on the average American family. Yes … there are a small percentage of Americans who suffer disproportionately from any price increase – truly suffer. They are also the same folks who were suffering from the ravages of poverty in the past.

But in terms of the overall picture, the economy is good and very few Americans are truly “suffering” or in “desperate straits” as we see reported.

Of course, complaining about price increases is as natural as grandma’s apple pie. But we should understand that those media reports of pandemic suffering because of the state of the U.S. economy are mostly mendacious political narratives … partisan propaganda.

No one likes price increases … no one. And those politically motivated narratives may paint a dark picture, but the facts suggest otherwise.

For sure, many Americans are complaining. But are they suffering? Not really. Most American are doing just fine – even in the face of price increases.

So … let us look at the facts. For that, I often turn to economist Robert Genetski. (if you do not know him, do the Google or Ai thing). Here are some observations from his most recent report.

“Stock prices soared and oil prices fell from $112 to $95 as investors continue to anticipate an end to hostilities with Iran. First quarter earnings among key tech companies were up 20% to 50% from a year ago. All major indexes reached new all-time highs this week. Tech heavy Nasdaq and QQQs led with gains of 4%, the S&P 500 and Russel 2000 rose 2%.”

“As oil prices have moved slightly down from their peaks, longer-term interest rates have also moved slightly lower. Unfortunately, with the extension of the war into May, monthly inflation will be higher than we anticipated. As a result, we expect interest rates will remain elevated until the third quarter, when inflation is likely to begin its downtrend.”

And what about that inflation rate – or the Consumer Price Index (CPI), as if is formally known? Yes, it is increasing at the moment, but still rather low. According to the U.S. Bureau of Labor Statistics, it is running at 3.3 percent. Compare that to the Biden Inflation of 9 percent, and we still see an economy ethat is in good shape in terms of inflation – and will likely get better.

Importantly, the Bureau reports a wage growth rate of 3.5 percent – which means that the incomes of American workers are pacing slightly ahead of the inflation rate. In other words, American’s purchasing power remains level.

Put simply, it means the American worker can cover the increased costs without any significant changes in spending habits. That is substantiated by consumer purchasing. There has been no meaningful reduction in retail sales. People are buying the same stuff they purchased in the past — even at higher prices because they can afford to do so. That does not look like suffering on a mass scale.

It seems that a lot of people are saying they are being crushed by the economy, If the economy is so good, why do they say that? It seems this is one of those situations President Lincoln had in mind when he said, “widely held beliefs, whether well or ill founded, have the impact of fact.” The crushing economy is certainly a widely held belief – but obviously ill founded.

Democrats push the Draconian economic message for political reasons. It is to hurt Republicans in the upcoming midterm election. That is normal politics. However, it is amplified by an irrational hatred of President Trump. Grassroots left-wing partisans and Trump haters are eager to spread the message without consideration to the facts. Left-wing media makes the Democrat propaganda the mainstay of their reporting. And, I hate to say it, but we have become a nation of whiners – people who believe one less dinner in an upscale restaurant is a personal catastrophe.

There is a saying in politics that what the party in power points to with pride, the out party views with alarm. That seems to apply to the state of the U.S. economy. What impact the alarmist might have on the midterm election is yet to be seen, but we can rest assured that for now the economy is in good shape and the people are still benefiting – not suffering – from free market capitalism.

So, there ‘tis.