What’s The Point Of Having A Job If You Can’t Buy Anything?

At least not at a reasonable price

The little coffee shop near me I tend to ride my bike to 2–3 days a week just raised its prices about 40%. Since I’ve always had them fill up my own hot cup I bring along with me, I now just show up with my own coffee that I make at home and just go there and sit outside and drink it. I wonder if they’re ever going to notice. At the same time, I’ll soon have a 1-day layover in San Francisco, and the price I’ll pay for a rental car for that day is 100% more than I’ve ever paid for a rental car in San Francisco before. (Not to mention the gas.) I’m still holding out hope one of my Bay Area friends says “don’t worry, we’ll pick you up/drop you off at the airport”. But if not, I’ll pay it.

What does that all mean? And does it mean I’m too focused on this aspect of my life, and not focused enough on the fact that I’m getting a little more work now than I was? And is the bias of mainstream media that’s got me thinking that way?

I don’t think so.

The problem with putting more emphasis on job creation and low unemployment, especially with supply chains all screwed up and prices for many things sky high is that too is actually supportive of inflation.

So they’re stories that can’t be separated.

And for most people, what it costs to buy things is far more the most important piece.

And though the following statement may prove to be controversial, what the last few months has proven to me is not that media is being unfair, but that most people would rather have a little bit of a harder time finding work but access to cheap goods, than have a choice of jobs but everything’s really expensive.

And right now there are way too many dollars chasing too few goods.

So for most people, not just the media, inflation is a much bigger issue than jobs, and actually, and kind of sadly, job growth contributes to inflation. This isn’t because there’s wage inflation. There isn’t really. And that’s also sad in a way.

But there’s no denying there are a lot of dollars out there, and that’s what’s creating havoc.

A more crass way of putting it this period of time is proving that people would rather have a harder time finding work but everything they want to buy is cheap, than be able to get multiple jobs and but not be able to afford anything.

So I do think it’s fair that inflation gets more coverage because it’s more important to most people right now.

It’s sad to say, but higher unemployment would be one of the best inflation fighters right now because then people wouldn’t be able to pay higher prices for things so the prices would have to come down. Right now, they complain, but they do pay. Because, like, you have to pay more for gas if you drive to work.

Like I’m paying $150 for that rental car for a day in San Francisco. It seems outrageous, but I’m not cancelling over that. But if I didn’t have the income to cover it, I wouldn’t, and they’d have to lower prices.

So too much job growth is not a good thing because it actually helps fuel inflation. And it’s fair I think that people are much more concerned about inflation right now than jobs. So the fact that media is reflecting that is not as unfair as seems on the face of it.

Just a few years ago a lot of very serious, respected people (I’m not any of those things, and if you’ve read my blog over the years you’ll see I did not agree with them), were running around saying that there’s no danger of there ever being inflation ever again. And they are at least in part to blame for what’s happening right now, because they saw no downside to supercharging an already heated economy prior to COVID. (They are also being very quiet now. To me, that’s a story that’s been very neglected by mainstream media, but what do I know?)

So why were they thinking/saying what they were thinking/saying?

They felt the world was literally our oyster. No inflation having a lot to do with the sophistication of modern-day supply chains. Which meant there’d always be a cheaper place to produce goods, so the price of goods would stay down forever. And eventually when wages started evening out globally, everything would be automated. (I oversimplify, but…)

You saw a good example of this when Trump put tariffs on China. Chinese manufacturers moved production to places like Vietnam. Which they were going to do anyway. This just accelerated that process.

What Trump didn’t do — which no one does — but Trump said he would, was actually bring jobs back to the US. Like by saying corporations could only get the humongous tax cuts he gave them for free if they brought jobs back from overseas. He said so but he didn’t. In fact, he made it easier for US companies to produce overseas. But if he had brought jobs back, wouldn’t that have been even more of a problem with a saturated labor market now? No.

Because presumably with more US made goods there’s less reliance on tangled supply chains, which as I said are a big part of this equation. On the other hand, there’d be nothing preventing those US companies for selling their wares at inflated prices overseas. Which is also kind of happening now, especially in sectors like energy, even with more Americans engaged in economic growth than maybe ever before.

So yes, job growth is great but not if there’s not enough things for people to buy. In addition the fact that the Federal Reserve flooded the market with money to keep it from locking up during COVID — which they had to do — means there’s so much cash out there that basically someone can pay for anything no matter what the price, and that’s not really good for families no matter how many jobs may be available to them.

As to the question of whether President Biden is being unfairly blamed for inflation he had nothing to do with, and not credited for job growth that he did, sure. But that’s called being President. As far as I’m concerned, all Presidents are going to be blamed for everything bad, even if they had nothing to do with it, which gives them the absolute right to take full credit for anything that happens that’s good, even if they didn’t really have anything to do with it either. Those times yet may come…