In 1906, Alfred Henry Lewis stated, “There are only nine meals between mankind and anarchy.” The sentiment was expressed right on the heels of a banking crisis which led to the Panic of 1907. The event was widely blamed on a liquidity crunch, and this same crisis was used as a rationale for the creation of the Federal Reserve Bank in 1913-1916. Of course, it is the central bank and its ability to generate fiat money from thin air (unbacked liquidity) that has led the US to the stagflationary disaster we face today. The “solutions” offered by establishment elites are often worse than the problems they are supposed to solve.
The total inflationary damage done to Americans consumers since 2020 varies according to who you ask. Stats from the Federal Reserve and government are muddled in a series of creative mathematics in order to make the situation look much better than it is. CPI is not a valid indicator of true inflation given it is watered down with over 80,000 items and services, and many of them are not necessities for the common US household. If we look only at necessities like housing, food and energy, the economic picture looks increasingly bleak.
Food, as Alfred Lewis noted, is particularly vital to civil cohesion. The human body can in fact survive up to three weeks without a meal, but the vast majority of people in the First World are not acclimated to such conditions and might just panic after one or two days without sustenance.
The potential for this scenario might sound exaggerated to those in a higher income bracket, but it’s important for these people to understand that a 25%-50% increase in food costs for them is not the same as a similar increase for people on a low or fixed income. For example, food price increases for the average middle-class to upper-middle-class households amount to around 11% of their annual income in 2023. However, for people in the low-income bracket, food costs now amount to 31% of their annual income. That’s a pile driver to the wallet.
The problem may also be even more pervasive than the data indicates, with inflation tracking under-representing real prices on the shelves. Just look at this price comparison of 2020 grocery expenses vs 2023 grocery expenses by one US consumer: