If rising prices are hurting your family and causing stress as we enter the Christmas season, you are not alone. According to a new survey published by Empower, a financial services company, 73% of the 2,034 respondents said they are experiencing "financial stress."
Rising prices of goods and services is not some natural phenomenon with an unknown origin. Our federal government has run up record budget deficits by recklessly spending on wasteful government projects. And when we were hit with the COVID pandemic, politicians believed we could spend our way out of disaster.
The large spending in Washington did not come directly from taxes though. Politicians turned to the Federal Reserve Bank and its printing press to create new money out of thin air and buy up our government's debt. Inflating the money supply, devalues the dollar, because there's now more money in our economy without an equal increase in the supply of goods and services. That puts upward pressure on prices.
The government's inflation policies were a hidden tax on the American people and it was about a 20% hit to our bottom line over the last four years.
The Empower survey found that a third of respondents said a "relatively attainable gain of $15,000 would make a meaningful impact in their lives." Using an inflation calculator, if a family made $75,000 in 2019, they would need to make $90,259, or roughly $15,000 more, to have the same standard of living today. Although, the real number is likely worse since the government's measure of inflation takes out the rise in food and fuel prices.
If we want to get out of this terrible economic situation, government has to shrink, eliminate the deficit and start paying down the debt.