The American obsession with inflation is interesting, considering the unanimous agreement among those with an above-kindergarten-level understanding of economics that modest inflation of a few percent is generally the optimal state of affairs, for a variety of reasons. (There is a summary on the Wikipedia article on inflation, for those interested.) No reasonable case can be made that inflation ranks among the top 1000 problems in US society or its economy. I say it’s an American obsession, as it’s really not popularly discussed among laymen to the same degree in most other above-average economies.
From an anthropological/sociological perspective, it’s a fascinating question what drives this obsession. I’m not qualified to give an authoritative answer, but I may speculate that weak unions and a lack of collective wage agreements drive job-hopping as a major source of keeping up with inflation. This results in people associating their wage gains with their own career advancement and skills, rather than with inflation causing their own labour costs to increase. On the other hand, when wages are indexed to inflation automatically, at least to a large degree, then people care less about inflation eroding their wages. People perhaps do not have sufficient abstract reasoning skills to realize that when their wages are flat and inflation is a few percent, it’s in fact not so much inflation eroding their wages, but employers actively deciding to cut their real wages.
Hence “Inflation” is a loaded term that has come to encapsulate other issues consumers are feeling, like wage stagnation, wealth inequity, seemingly high taxes with rising debt and borrowing costs, enshittification, supply issues, purchasing power issues, and other systemic problems like that.
I don’t like it. It’s unscientific and masks too much. But when Americans say “inflation,” I really think they’re expressing feelings for much more than that.
The American obsession with inflation is interesting, considering the unanimous agreement among those with an above-kindergarten-level understanding of economics that modest inflation of a few percent is generally the optimal state of affairs, for a variety of reasons. (There is a summary on the Wikipedia article on inflation, for those interested.) No reasonable case can be made that inflation ranks among the top 1000 problems in US society or its economy. I say it’s an American obsession, as it’s really not popularly discussed among laymen to the same degree in most other above-average economies.
From an anthropological/sociological perspective, it’s a fascinating question what drives this obsession. I’m not qualified to give an authoritative answer, but I may speculate that weak unions and a lack of collective wage agreements drive job-hopping as a major source of keeping up with inflation. This results in people associating their wage gains with their own career advancement and skills, rather than with inflation causing their own labour costs to increase. On the other hand, when wages are indexed to inflation automatically, at least to a large degree, then people care less about inflation eroding their wages. People perhaps do not have sufficient abstract reasoning skills to realize that when their wages are flat and inflation is a few percent, it’s in fact not so much inflation eroding their wages, but employers actively deciding to cut their real wages.
Hence “Inflation” is a loaded term that has come to encapsulate other issues consumers are feeling, like wage stagnation, wealth inequity, seemingly high taxes with rising debt and borrowing costs, enshittification, supply issues, purchasing power issues, and other systemic problems like that.
I don’t like it. It’s unscientific and masks too much. But when Americans say “inflation,” I really think they’re expressing feelings for much more than that.