Fort Mill Times

Inflation: We're about to burst

Every time we open our wallets for necessities these days, for food, fuel and clothes, or discretionary spending such as entertainment, the dollars are flying out at a dizzying rate. Couple that with a prolonged period of stagnant wages, lower property values and investment losses, and the pinch is getting to be more like a bite.

Just last week, AAA announced that gasoline prices in South Carolina, at about $3.13 a gallon for regular unleaded, jumped 62 cents compared to this time last year. That's just a fraction of a penny below the record high set Sept. 5, 2005, after Hurricane Katrina disrupted production.

Some of our older residents will remember when, in the Depression era, gas was somewhere in the 14 cents a gallon range; Those of us who grew up in the 1970s recall the outrage when the price reached $1 - and the shortages that followed the embargo enacted by the Middle East's oil-producing nations.

By then, inflation was already a headache shared by consumers and government alike, and now our temples are throbbing like never before.

Consider the cost of living in broader terms: According to our archives, in 1968, a pound of coffee cost 49 cents and you could buy two dozen eggs for 73 cents - on sale, of course; Bread was 49 cents a loaf, ham sold for 99 cents a pound and a Sunday buffet exacted the whopping sum of $1.50. Dress shirts were two for $5 and women's dresses ranged from $5.88 to $17.99. If you wanted to catch the latest feature at the Center theatre, adults shelled out $1 for a ticket.

Wow!

No one could expect prices to remain anywhere close to that over 40 years, but typical middle-income earnings - even in two-wage households - have not kept pace with inflation. Add in the ever-increasing cost of sending kids to college and paying for health care, and we wonder if we're on the threshold of a tipping point.

A big part of the problem lately is something consumer advocates are just starting to make noise about: ethanol.

What was supposed to be the magic elixir to bridge the gap from complete oil dependence to tooling around in battery-powered cars has turned out to be a sham. The return on a $7 billion investment of taxpayers' money in 2006 for subsidies to farmers to encourage the production of corn, ethanol's chief ingredient, is outrageous: higher prices at the grocery market and the pump. As it turned out, the rush to grow more corn has led to a shortage of wheat and other crops, including those used to produce animal feed, resulting in an alarming escalation in prices for bread, meat, dairy products - and even corn.

So, what to do when it costs more to travel to shopping destinations and to buy what you need there?

For one thing, keep pressure on elected representatives to forget about ethanol, stop frittering away precious tax dollars and focus on more viable energy alternatives. A more hands-on approach would be to shop more wisely. Plan ahead, make fewer trips and take advantage of sales and coupons. In fact, keep an eye out for our quarterly ShopSmart coupon book and a new Shop Local page this spring - it will be teeming with bargains. We're not saying that will make you think you've time-warped back to 1968, but every little bit adds up.

Also on a positive note, we should all remember that economic woes tend to be cyclical. No one can predict what awaits, but our country has always shown resolve in tough times and eventually, the tough times end. Even more reason to hope is, no matter which party wins the White House in November, the first new administration in nearly a decade will be calling the shots in 2009. Just that change alone might shake us out of our collective malaise.

At least we can hope.

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