The Heavy Hand of Inflation Has Descended. What Next?

03/22/2011 06:44 am ET | Updated May 25, 2011

The triple disasters in Japan and the prospect of a brand new Middle East quagmire in Libya have certainly drawn our attention away - at least temporarily - from the Wisconsin state house and other budget and political crises growing in our own backyard. So it is not surprising that we have little noticed that our very food supply is coming under assault by soaring inflation.

In a March 13, 2011 article in the New York Post, economist Martin Kohli of the US Bureau of Labor Statistics said the main culprits conspiring against the national food basket are this winter's harsh weather, growing demand from China and India, and ballooning energy costs. Commodity prices have been rising for the past 7-8 weeks, according to Ephraim Leibtag, Deputy Director for Research at the USDA and Product Coordinator in the Economic Research Service's Food Economics Division. Between January and February alone, the costs of vegetables rose 23%, while pasta was up 5% and beef 3%. Meanwhile, fish and shellfish prices have risen 12% since last year. Food pyramid staples like cheese, meat, poultry and fresh vegetables are all more expensive, and, according to Mr. Kohli, with the Chinese buying more and more of our wheat for their noodles, the prices for pasta, bagels, pizza and other wheat-based products will continue to rise. Walk down the cereal aisle in any super market and you will find little evidence to the contrary, with few choices costing less than $5.00 per box. With any luck, you might find a box for $3.49 that a few days earlier cost $2.89. Only eggs seem to be holding steady, with prices the same or slightly lower. Overall, food prices rose 3.9% last month, the highest single-month increase since November 1974. How much higher will they go in the next few months, and what impact will this have on our nutritional needs?

Add to this the double-whammy bomb of gasoline rising toward $4.00 per gallon, just as we arrive at the end of one of the fiercest winters in anyone's memory. A seemingly endless string of storms hit us from coast to coast, including in regions that have rarely experienced such extreme temperatures or snow. Our fruit and vegetable growing areas were decimated, seriously impacting the national family food basket. The cost of delivering those depleted foods is leading to the daily consumer sticker shock on the most basic of food necessities, which are also beginning to be in short supply and of increasingly poor quality, in part due to the freezing conditions in which they were grown. Many items are now not seen in neighborhood stores, replaced by signs blaming their absence on weather, quality and, in some cases, price. It's getting harder to even find a head of lettuce, eggplant, celery, tomatoes, peppers, cucumbers or any other vegetables or fruits we expect to be available on demand year round.

I found some other wildly inflated prices on a recent trip to my local grocer: $2.79 for a head of Romaine lettuce; eggplant at $5.00 per pound; a cucumber for 69 cents, apples costing $1.00 a piece; a box of grape tomatoes for $4.00; cauliflower at $3.99 a head; a can of tuna in olive oil between $2.29 -$3.79; and of particular consternation for me, coffee up $1-$2 per pound. I also found fish in some markets that had come in frozen from abroad, no doubt in part due to the disaster in the Gulf of Mexico - anyone outside of the poor people of coastal Louisiana, Mississippi Alabama and Florida still remember that? I found milk at up to $1.29 per quart, organic eggs at $3.49 for a 1/2 dozen, imported cheeses from $12- $25 per pound, and American processed cheese at a whopping $6.99 a pound.

Beyond the high prices, you may not even see any lamb or steaks, as I noticed in a supermarket the other day. But in the same working class ethnic community of Latinos and newly-arrived Middle-Easterners, you will find good prices for goat meat - delicious, lean but difficult to cook - at around $3.49 per pound. On the other hand, lamb in the mini market on my street now comes in from Australia, yet is still cheaper than our home grown lamb, costing $14.99 per pound for rib lamb chops and a relative bargain for loin lamb chops at $10.99 per pound. Bread, meanwhile, can run any where from $2.69 - $4.00 a loaf, with some specialty breads coming in even higher. Obviously, prices will vary from state to state and store to store, but there is little doubt we must all become careful shoppers and even learn how to shop with store coupons to stretch our dollars.

Planning a dinner out, you will experience more sticker shock. A good restaurant where you enjoyed a wonderful meal a year ago may no longer be affordable this year. A new restaurant trend is opting to serve "prix fixe" dinners, instead of ala carte, where you could individually select food choices on a menu, helping to control the cost of the meal. A complete meal for $100-$145 per person in the fixed price category is not out of the ordinary, a bill which does not include that bottle of wine, tax, and tip. A two-course prix fixe lunch for one can easily reach about $70.00, without wine, tax, or tip included. On the other hand, the traditionally cheap Chinese meal is also a thing of the past, easily costing from $8 to $17.00 these days, still a relative bargain in most neighborhoods.

Just the other day I was checking out prices at chain stores and local independently owned markets for this article, and a homeless man stopped me on the street and asked for a handout - $3.00 for a fast food lunch, pointing to a national chain we had stopped in front of. Food inflation and its impact has also registered on the observant hungry. No longer is a request for 50 cents or a dollar adequate these days. So how are our hungry, homeless, unemployed and underemployed doing if the sustenance of life is becoming unaffordable?

We can't blame our President for this one: he has had no control over the weather, although some might disagree. But he can get cracking on alternative energy sources, for fuel costs have also affected the heating bill in private homes and apartment buildings, along with electricity and other increased property maintenance costs. Maintenance for my apartment rose 16% last year, and is now going up next month another 4%. So, is anyone in Washington noticing any of this? The last we heard from Ben Bernanke a few months ago was that inflation was low. Yeah, right, Ben.

And after buying food, who can even afford or consider the purchase of clothes and other staples? All of this, on top of this year's excessive increases in healthcare insurance, is enough to make the strongest of us weep. Isn't there something about AFFORDABILITY in the name of the healthcare bill? Ah, yes, its new shortened name, the AFFORDABLE CARE ACT, coming up on its first anniversary since being signed into law on March 23rd of last year. DNC-sponsored celebrations will take place across the country on this Wednesday to mark the date. Personally, I think it should be called the NON-AFFORDABLE ACT, with the outrageous and un-harnessed costs of healthcare for the American family continuing this year, with no relief in sight. Higher premiums, co-pays, deductibles - healthcare is costing more while delivering less.

Will these higher costs across the board become a major issues in your campaign for re-election, Mr. President? Living in our America is just becoming too unaffordable, with flat and decreasing wages for decades butting up against rising prices for just about everything. Something has got to give.