The ‘Ruinous’ Inflation Is Ruining Us, Right?

Yesterday I paid $3.85 for gasoline at the local convenience store. A week ago, the price was $4.19. A week before that it was $4.49. So, as of today, the 12 gallons I put into my car every time I fill up is now costing me $6 dollars less than it cost me two weeks ago — enough left over for a coffee and a lottery ticket on my way to work.

According to the Commerce Department, the only two categories of expenditures which have increased more than 5 percent over the same time a year ago are energy and food. Now granted, these two categories comprise at least one-third of the average household budget, maybe as much as one half. And these two categories have increased over last year by more than 50 percent.

That’s the bad news about this current inflationary time. The good news is that these two categories are also categories whose prices are not just a function of supply and demand but are categories in which the demand for these products is not just a function of what consumers have to spend, it’s also a function of what they want to spend.

A few years ago, I recall that the average automobile commute was 16 miles each way which for the typical car being driven back and forth to work, means roughly 1.5 gallons of gasoline every day or 30 gallons every month. At 5 bucks a gallon I’m going to spend $150 a month to earn…