While Federal Reserve Chairman Ben Bernanke comfortably dismisses rising food prices as a transient phenomenon that has not perturbed inflation expectations, many of America’s poor are finding that food inflation (something I have called “agflation” in the past) is the pest that refuses to leave. In “Rising food prices could drive up rates of hunger“, John Sepulvado of CNN Radio paints a poignant portrait of America’s growing population of hungry poor.
The statistics are staggering but the personal tales of struggle are even more potent. Here is a description of the current life of Wendy Madison of Opelika (emphasis mine):
“…there was a 10-year period where her family was doing well, before her husband Joseph had a massive heart attack. She says her family’s biggest mistake is they failed to plan for such hard times, and didn’t save.
Now, their family of three depends on a little more than $1,000 dollars in disability pay, along with $294.00 in food stamp benefits per month — the equivalent of a dollar per meal. Madison says her food stamp benefits have not increased despite rising food prices. An increase in benefits have been denied repeatedly — leaving the Madisons ‘begging for food while going hungry.’
‘It makes you feel useless,’ Madison says, ‘like your government is waiting for you to die so they don’t have to help you anymore.'”
Regardless of your position on Federal assistance programs, stories such as these are stark reminders that inflation is very real for a significant portion of our country. Another way to think about the issue is that despite all the money the Federal Reserve has printed through QE1 and QE2, very little has yet to get to the people in the most dire need of it, whether through jobs, higher wages, and/or assistance. Yet, this same printing is very likely exacerbating the upward pressure on the items that consume large portions of the budgets of the poor: food and energy.