Devastation of Market Distortion is Coming Home to Roost


Wholesale Food Prices Highest since 74′

Food Stamps Surge in West

These two headlines are quintessential examples of the perennial cycle of government intervention.  They offer a vivid portrayal of how the Democrats perfidiously inflate the price of food so that the maximum number of people will be dependent upon their food programs, thus granting them a permanent electoral constituency.

Obama and the Democrat economists have championed a monetary policy of quantitative easing (QE2) over the past few years as a means of reviving the economy.  These economic “experts” felt that by abusing the Fed’s mandate to ostensibly print extra money and offer negative real interest rates to banks, the stock market would surge and spawn an economic recovery.  It was all for the benefit of Main Street, of course.

In addition, these same selfish market interventionists have perpetuated the ethanol mandates, subsidies, and tariffs that have wreaked havoc on the global food commodities market.  As much as 40% of domestic corn is being diverted for the use of ethanol, an extremely inefficient fuel source.  The promulgation of this ineffective fuel source, along with Obama’s war on all other efficacious energy sources such as fossil fuels has in turn spiked the cost of transportation of food.

Now, the socialist chickens have come home to roost.  After months of QE2 and years of fatuous ethanol and energy policies, food prices are near record highs.  The Labor Department reported today that the wholesale measure of food prices, the Producer Price Index (PPI), rose 1.6% in February:

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Bonus points,Curt,for “purfidiously”.

In the Beginning, I had high hopes for ethanol, but it’s proven to be a BUST! the cost vs benefit ratio is upside down…. and, it gets LESS MPG than STRAIGHT GAS! Time for Washington to MAN UP, admit the failure, and cut our losses and GET OUT of it. ONCE again… GOV “meddling” has proves costly, erroneous , and well, just plain STUPID! Time to move on!
Now, if we only had a MAN in the WH who would act…..

Also, the index of leading economic indicators has been “formulated” so as NOT too look bad, when it is! Time it was set back up, to actually MEAN something!

Food rioting was the original impetus for the current Middle East uprisings.
Paternalistic Arab governments forgot to take the losses when food prices rose.
They thought their people could absorb the higher costs and, if they got mad at anyone, it would be Israel and the USA (as usual).
But this time was different.
Sure, the internet and cell phone communications had a lot to do with it, but the leaders’ getting caught partying both at home and on foreign soil didn’t help.

So, here we are, facing incredible food price hikes.
I used to only make my own bread in the cool winter months, but when I see a $1.59 loaf now selling for $4.39 I am reconsidering.
If I buy my #50 bag of whole wheat it will last through summer at least.
It comes to less than $1 a loaf and tastes terrific.

I feel sorry for those who rely on others to cook for them, whether at restaraunts, fast food joints or processed foods.
They must really be feeling the pinch!
We cook from scratch and yet our food bill for basics rises every month.

And about ethanol.
We, in So Cal have mild winters.
Our gasolines are blended and include ethanol some parts of the year (I think).
Local radio stations claim that all of the older cars seen on fire by the side of the roads are mostly because of ethanol in the mix and an older engine.
I don’t know how much truth there is to that.
It seems to be a pervasive story here.
I do wonder how cars get by on the stuff where the winters are harsh.

@Nan G:

I feel sorry for those who rely on others to cook for them, whether at restaraunts, fast food joints or processed foods.
They must really be feeling the pinch!
We cook from scratch and yet our food bill for basics rises every month.

My wife and I try to cook as many meals at home, and from scratch as possible. Even so, like you said, it continues to cost us more and more at the grocer. And when you add in the days we have to purchase food outside the home, well, we spend more and more on food every day it seems.

And what do we have? Idiots like Trumka wishing to impose higher fuel prices, which invariably lead to even higher prices for food, either at the grocer or the restaurant. And more subsidies for the ethanol producers, which leads to higher food prices as many items, even at the grocer, are made with corn by-products(which is partially why the switch to scratch made food). Unfortunately, even other food prices are affected by rising corn prices.

As I was talking about in the Michael Moore thread, liberals tend to institute artificial corrections to the free market, many times to the detriment of the market, and the result is effects beyond the expected results, and we, the consumers, end up paying for their idiocy.