The Consumer Economy Headshot

The truth is that the consumer-driven model is now functionally dead, an economic zombie shambling along and awaiting the merciful head shot that drops it, allowing it to be kicked into the gutter and out of the way.

PracticalDad, Post-Consumer Parenting (April 8, 2016)

The consumer-driven model that has powered this nation’s economy for three quarters of a century is now officially dead, the head shot delivered by…a virus.  Like any zombie, it was compelled to mindlessly consume yet was malnourished by an increasingly severe lack of purchasing power.  I would have been less surprised by the manner of death than to find that Bette White was cast as the new villain on The Walking Dead.

It starved for years, certainly longer than April 2016, when I wrote the above linked post.  Zombification occurred in stages over the course of decades.  One contributing factor was the effort by corporate employers to shift from pensions to 401k plans, citing the need to cut costs and allow for funding to compete against other companies.  Another was the claimed throttling cost of benefits, consequently cutting back on health care benefits in the face of rising costs.  Yet another was the drive to maximize shareholder value by decreasing labor costs, shipping jobs – even entire plants – overseas or increasing the drive to automate them.  Even with these ongoing hits, the process was accelerated by an economic demand that now mandated a college degree for entry into the fabled American Middle Class.

The condition however, became terminal with the Financial Crisis of 2008, from which it never recovered.

The symptoms have been there for years in any variety of news articles:

To quote Captain America:  I can do this all day.

Understanding the impact of this collapse is helped by understanding how the model came about in the first place and for that, you have to return to the period immediately prior to the Great Depression.  Economists were developing the Expenditures Theory of Gross Domestic Product:  C + I + G +(X – M) to help create a systemic framework for understanding the national economy .  Simply put, a nation’s GDP is a function of the aggregate spending of Consumers (C), Business (I), Governments (G) as well as the aggregate international balance of trade between exports (X) and imports (M).

We might recall the decade as the “Roaring Twenties” but the reality was different.  There was supreme confidence in the business community and many industrialists and financiers bought into the notion that the historic business cycle of boom-and-bust had been eliminated.  But there was an awareness among others that significant problems still existed.  The agricultural sector was mired in an economic depression as crop prices had collapsed years before the Wall Street collapse.  Some were aware of the inequitable distribution of wealth in society and others noted that the lion’s share of the economy’s productivity gains through the decade had accrued to the wealthiest class.  The average American worker saw significant wage gains but the top 5% of wage earners garnered 34% of the disposable income, up from 24% in 1920.  Then came the collapse of 1929.

President Herbert Hoover’s responses to the Great Depression were constrained by the philosophy – along with almost everyone else – that the Federal Government must annually balance it’s budget.  There was plenty of rah-rah jawboning and some effort to run a small deficit and create additional relief programs but in the end, he was bound by his personal belief that it was up to American individualism to find a way out instead of government action.  Relief programs were left to charity and local and state governments but the continued spiral downwards left everyone without money so that by 1932, destitution reigned; the economy was at the point of real collapse and Senators were warning of open revolt by the election of 1932.

Yet debate among economists continued during that period and it was in 1930 that John Maynard Keynes wrote A Treatise on Money, which became the basis for what we now know as Keynesian Economics.  Another economist caught the ear of nominee FDR in that period however, and his name was William Trufant Foster.

The heart of Foster’s concept was that the Depression was ultimately caused by under-consumption, that the average person simply didn’t have the financial wherewithal to support the purchasing power required for all of the economic output produced.  If there was to be renewed growth of output and through it, employment and wage growth, it had to come via increased consumption in any fashion, whether by the individual, the business sector or the government.  Keynes’ work provided the intellectual justification to allow government deficit spending to spur that aggregate demand in economic downturns.

I don’t know that we can now appreciate the level of political and economic chaos in the period between FDR’s election in November 1932 and his inauguration in March of 1933 (the inauguration date was later moved to January).  Farmers were banding together to actively deter farm foreclosures via threat and in some cases, actual violence.  The Soviet government actively supported a rising Communist party and through it all, hundreds of banks across the country were closing their doors, destroying the little savings that were left to the individual.  Two states independently declared bank holidays, temporarily closing all banks within the state for a one or two week period.  Why?  Fear.  The average American had so lost faith in the system and government that, anticipating his or her own bank to collapse, began pulling all their remaining money from banks.  By doing so, they themselves guaranteed a collapse.

Fear.

This was the backdrop for FDR’s now-famous First 100 Days.  It was the backdrop for the creation of new and untested programs to get people working and money once again flowing through the economy.  Fear was the enemy that FDR fought in that early period of his Administration and was the basis for his statement in his first inaugural address, The only thing we have to fear is fear itself.  FDR understood that money must be flow and consumption must be restored and in the short-term was willing to use the government budget to do it.  He also acknowledged the power of the budget and knew that in the longer term, the average citizen would have to step up and this could not happen until fear was lessened and purchasing power grown.

Why the introduction of bank deposit insurance via the FDIC?  To lessen the fear of bank collapse with the resulting loss of savings.

Why the introduction of Social Security?  To lessen the fear of poverty in old age.

Why the creation of multiple job and agricultural programs?  To lessen the fear of poverty, bankruptcy and ultimately, starvation.

And why the creation of multiple public authorities such as Rural Electrification and the Tennessee Valley Authority?  To spur the development of the physical infrastructure necessary for future growth and keep it out of the hands of the private sector, most particularly the financiers.

All of this was undertaken to rebuild the purchasing power of the American citizen and ultimately, to diminish fear because fear eroded faith in the system.

Remember that phrase:  purchasing power.

Government spending alone was insufficient however, and it was clear by the severe recession of 1937 that something new had to be tried.  This was interrupted by the Second World War and any other activity was shelved for the duration.  What happened through the post-war period however, was a series of measures that, by design or happenstance, assisted not only the economy and purchasing power of the American consumer but diminished the fear that kept it from being exercised.

  • The wide-spread availability of health insurance from employers meant that Americans were relieved of the fear of crippling medical bills.
  • Higher education was made more available to the large number of returning veterans via the GI Bill of 1944 and the quality of that education was increased with significantly higher public funding for facilities at state universities.
  • The existence of Social Security and the availability of company sponsored pension plans meant that Americans were, to a considerable extent, relieved of the fear of poverty in their old age.

This is where we find ourselves today.  The Consumer-driven economic model was predicated not just upon the wealth and incomes to support reasonable purchasing power, but also the assurance that there was a sufficient safety net to protect the constituent consumers.  The high cost of healthcare via premiums, deductibles and co-pays has shifted to the family with a subsequent loss of purchasing power.  The high cost of the college degree that is now a prerequisite to a job that at least promises stability has shifted first to the family, and then to the youth, with a subsequent loss of purchasing power.  The decrease of pension plans and the rise of self-funded retirement has shifted that to the family as well, with a subsequent loss of purchasing power.  Couple these with the disproportionate rise in the actual costs for healthcare and higher education?  Disaster.

There is a terminal lack of purchasing power.  That the average American had nothing upon which to rely when social distancing shutdowns occurred with no economic support forthcoming while the financial system and corporations were backstopped fed a smoldering anger.  That small business was forced to shutter while certain large retailers were declared essential spiked that anger.  People can talk all that they want about the pandemic measures impinging upon their rights, the underlying fear is that they face economic ruin unless they can return to their jobs.  Regardless of where you are on the political spectrum, it is ultimately an anger built upon the practical implications of economic inequality that we have allowed to take root.

Perhaps the only remote silver lining to this freakishly misbegotten shit show is that it is occurring in an election year.  What we have known as an economy is functionally dead.  The national savings rate has spiked to 33% in April 2020 and the economic establishment states that we are hoarding cash.  Do you know what I say?

Good.

Why should we now spend for anything other than necessities?  Why should we spend when government and corporate policies make it clear that our families will receive no meaningful support?  Why should we upgrade and consume when the products, although ostensibly American, are built overseas and profits are disseminated only to shareholders and senior executives?

There is now a debate brewing in Washington as to whether the temporary additional weekly unemployment benefits of $600 should be extended past their July 31, 2020 expiration.  This is occurring because research finds that fully 68% of American workers now have UI benefits greater than their weekly wage.  Conservative legislators fear – understandably – that there is no longer an incentive to work and that such benefits constitute a moral hazard.  Yet they oppose an increase in the minimum wage.  They oppose any public sector financing for healthcare.  They oppose any increase in public funding for higher education and some even support decreasing funding for elementary and secondary education.  And they support a President whose 2020 budget proposal called for Medicare and Medicaid cuts to address a trillion dollar deficit.

And they do not answer the underlying question:  How have we come to this juncture that the wages are so disproportionate to what is required to survive in America today?

This is why the election year timing matters now.  There must be clear and progressive – even radical – policy choices made to help create a new model driving economic growth, one that is not piled upon the back of an American citizen again bereft of purchasing power and crippled by fear.

And yes, one that actively encompasses a real core of social justice.

Pandemic Food Price Index (6/2020): You Can’t Always Get What You Want…

May of 2020 saw the inaugural edition of the Pandemic Food Price Index, a 37 item market basket of foodstuffs to measure the impact of the Pandemic on grocery store food prices.  Here are the results and observations for June, 2020.

  • The nominal cost of the 37 item basket, shown at the bottom, was $89.09 in June.  This was an increase of $.58 from the May 2020 baseline cost of $88.51.  The Pandemic FPI is now at 100.66:

(((89.09-88.51)/88.51)*100) + 100 = 100.66

  • An increase of .66% seems minor, but this is monthly and extrapolates to an annualized rate of 7.92%.
  • A basket of 37 items priced at three stores is a total item count of 111 individual items.  Of these 111 items, there were seven of the 111 not in stock at the time for an out-of-stock rate of 6.3%.  Note that in each of the seven items, there were still labels on the shelves so the items were still for sale but just not in stock at that moment.  This is in comparison to the three items out-of-stock in May, 2020 (rate of 2.7%).
  • Five of the seven out-of-stocks were at the largest, internationally owned grocer and involved three of the four Staple category items (Canola Oil, Sugar, Flour generics) and two of the three cereals (Frosted Flakes, Rice Chex generics).  In each of the cases however, there were other alternatives for sale so it really is a case of you can’t always get what you want…
  • The anomaly was a case of stealth inflation.  The local grocer was no longer offering the 32 ounce jar of generic grape jelly and had replaced it with an 18 ounce package at a lower price.  I recalculated the per ounce price at the 18 ounce package level to an equivalent price at the original 32 ounce and this recalculated amount was used in the Index.  The nominal impact is a price decrease of 36% for the lesser amount but the real impact, had the original package been used, would have been a 14% increase.
  • The meat stocks were plentiful and what was notable in June versus May was the presence of the three pound “chub” of ground beef.  These packages first appeared in my local markets in approximately 2014 and were produced from factory-style meat processing plants; I suspect that the grocers were introducing them in response to the declining purchasing power of their customers.  These items were absent when I did the initial pricing on May 2 and their absence was due to the issues with Covid exposures at the factory-style meat processing plants.

Comments

As I noted, an increase of .66% doesn’t seem like much but annualized to almost 8% in a nation in which the family income has been smashed and the Q1 GDP has dropped by 5%, it is highly problematic.  Fortunately, enhanced SNAP benefits are in place for the remainder of FY 2020 and WIC benefits are likewise enhanced through the end of September, 2021.  Where it is an immediate problem is for senior citizens relying upon their Social Security benefits.  Why?  Because the cost of food is not included in the calculations for determining the COLA increases that occur in the latter half of each year.  If the prices continue to rise, the effective purchasing power of the senior citizen will actually lessen as the COLA amounts for the past five years have averaged 1.34%.

The grocery shelves are not bare and in each of the cases that I noted, there were other options available.  Even toilet paper is back in each store, albeit in smaller package sizing.  Rice was there but typically in larger sized bags and even in April and May, there was rice available but it was in brands sold to the Hispanic community and hence in a separate aisle.  The generic brand staples (canola oil, sugar, flour) were missing in the one store and although the stocks were minimal in the other two as well, there were reasonable amounts of name brand items available.  And no, I’m not going to count the damned bags of flour.  The indication is thus that people are doing what they can to stretch their dollar as they hunker down.

The renewed presence of the lowest price per pound “chub” had a significant impact here.  Had I used even last month’s lowest per pound price for ground beef, the FPI would have had a June Index level of 101.52 versus the actual 100.66.  Extrapolating to an annualized rate, the impact would be a hypothetical 18.24% rise versus the present annualized rate of 7.92%.  But I have severe qualms about that since I know that those plants are operating under the aegis of the invoked Defense Production Act, despite increased infection rates for those in the meat packing plants because of work conditions.

And I wonder whether or not, were we asked as part of a communal sacrifice for the common good, we would be willing and able to forego so much meat as part of our diet.  It was what our great-great-grandparents did for the common good on the home front of the Second World War, sacrificing something for those on the front lines.  But in times of Pandemic, the front lines are here.

Pandemic FPI (6/2020)

 

Addict America

What we are witnessing are the visceral images of a nation in the throes of an addiction.  It is an addiction to a message of Constitutional narcissism.  It is an addiction that has been knowingly fed by its dealers – Limbaugh, Hannity and their ilk – within the self-proclaimed Conservative Media for more than three decades.

Our nation is the same as any other well-heeled addict from prosperous circumstances.  We think we convey a sense of normalcy as the addiction grows, unaware that to the outside world, our property has grown seedier and our household more disorganized.  Most importantly, our children and most vulnerable are neglected and left as prey to the hard mercies of others.  The addiction stresses our ability to cope until something happens which collapses the facade and exposes our reality in its awful ugliness.  It is an addiction whose propagation now willingly courts death, a literal siren song luring the body politic to a mass fatal encounter as senseless as the American Civil War.

This something is obviously the Pandemic.  As I write this, the national daily death toll is such that the entire population of my hometown would be dead within a week and the numbers continue to rise, at least outside New York.  Yet many localities are again re-opening despite metrics that don’t even come close to those laid down by the Trump Administration and armed protesters stand on the steps of state capitol buildings proclaiming opposition to measures which purportedly infringe their Constitutionally mandated civil rights.  This opposition, fomented by the Conservative Media and the President – the guy whose folks put out the re-opening metrics less than a few days before, remember? – is predicated upon a wholesale misleading characterization of the Constitution.

How?

There is an inherent tension within the construct of the Constitution and that is the tension between the Me and the We.  The Me is encased within the Bill of Rights and has been the focus of the Conservative Media since the arrival of Rush Limbaugh after the repeal of the Fairness Doctrine in 1987.  Who doesn’t love our Bill of Rights?  It was the first written attempt in human history to enumerate and guarantee what were considered the essential rights of the individual in a society.  It is the most identifiable aspect of the Constitution.  The great majority of Americans can’t define the 17th Amendment let alone even tell you how many Amendments even exist.  But you can be damned sure that people know about their First Amendment right to freedom of speech and their Second Amendment right to bear arms.

Except that the Bill of Rights is only one part of the Constitution.  The other part of the Constitution is about the We.  The obvious and accelerating failure of the original Articles of Confederation prompted the calling of the meeting that became the Constitutional Convention of 1787.  It was the We that concerned Madison, Hamilton and the rest of the attendees.  Multiple states with different personalities based upon unique founding charters and culture, let alone geographic and economic differences, were too diverse to ensure continued political coherence.  The national structure was collapsing and the success of the Revolution would be rendered meaningless.

The Convention’s intent was not the Me, the Bill of Rights.  The Me wasn’t the first, second or third thing in the mind of either Madison or Hamilton.  It wasn’t on any agenda, as little as there was of one.  The Bill of Rights was an outgrowth of the debates as the Anti-Federalists pushed back against Madison.  In their minds, what was the point of the Revolution if it allowed the creation of a new government which could trample the individual as badly as the recent English king?  The resulting compromise created this Bill of Rights to assure that an individual’s rights were protected.  This compromise created an astounding document of political duality that attempted to balance the We Yin and the Me Yang.  There is supposed to be a balance.

These were the questions that most concerned the Constitution’s framers:  How can We maintain a civil society that can peaceably abide together under the principle that all are created equal under the law?  How can We allow for a civil society to change and adapt to the world around it within the framework of the first question?  How can We control power and allow the peaceable transfer of power?  Most importantly, how can We as a civil society protect ourselves from falling prey to predators such as demagogues, despots and zealots?

When viewed from this aspect, much of our history has been made in the effort to expand the We in the face of resistance from individual groups fearful of a loss of their own powers and wealth.  Expanding it to who?  Securing the rights of blacks and other minorities , including that key right to vote, expands the We.  Securing the rights of women, including that key right to vote, expands the We.  Why?  Because it’s through the securing of their own individual rights and enfranchisement that these groups – one of which actually comprises more than half of the population – can find a voice that entitles them to a place at the economic table sharing in the common wealth of the nation.  Not only sharing in the common wealth, but expanding it by dint of their own talents and efforts.

Commonweal.  It’s an archaic word used by my wife in a recent conversation as we discussed the multiple acronymic lifelines already thrown to the business community and capital markets but not extended in any meaningful measure to the average person.  It forms the basis of the word commonwealth and in its simplest terms is the common good.  It is the idea that while the members of a community can expect their rights to be respected by the community, they have a like obligation to the well-being of that  community, politically and economically.  Is it important to distance ourselves for a period to not overwhelm our medical system as well as protect our most vulnerable?  Then it’s what we do for the community and in turn, we expect the community to support us through this period.  Commonweal.

Except that that hasn’t happened.  The community has responded with full support to the wealthiest and only one-time payments to the general citizenry with the understanding that they would still be responsible for the upkeep of their bills.  In the meantime, the unemployment rate has skyrocketed.  The public has been left to bear the losses from a communal disaster without certainty of income for an unknown period.  In a society that embraced the commonwealth philosophy, the community would be certain to provide sufficient support to support its members while they were asked to participate social distancing to protect the community.

Not only do we ignore the concept of the common good, we have a Chief Executive who ignores the Constitution, exemplifying the fatal flaws of the original Articles of Confederation by abdicating responsibility for a national crisis to the individual states.

There should be balance.  We haven’t had that for decades.

Why?

The cultural birth of the Me preexisted it’s maturation in the 1980s.  The Boomer Generation were a cultural phenomenon and their quirks led to their titling as the Me Generation by the writer Tom Wolfe in 1976.  That generation – mine – turned society on its head in search of self-fulfillment and it persisted as they aged and entered the economic and political mainstream.

Their entry into the mainstream set the stage for the economic and political rise of the Me in the 1980s.  Rush Limbaugh, the first of the Conservative Media, arose on the back of a resurgent conservative response to Ronald Reagan’s famous comment:  Government isn’t the solution, it’s the problem.  Limbaugh expanded upon that with the message that I earned that money and I should be allowed to keep it.  Soon, other commentators entered the field and proceeded to help fracture the We by separating the nation into Good Americans versus Liberals and Republicans versus Democrats in the search for listeners and market share.  Understand this:  Conservative Media is not only a message of anger but a business model of anger as well.  Anger and fear are profitable and this profitability has caused an even harder push.

Uncertain about this?  Consider Les Moonves’ – then CEO of Columbia Broadcasting – comment about Donald Trump in 2016:  “It may not be good for America, but it’s damn good for CBS”.

It’s the same for the other side of the media spectrum as increased competition extends the boundaries and coarsens the dialogue to gain listeners.

But why do Conservative Commentators have the advantage in ratings?  Where do they find the materials to gin up rage, secure listeners and earn profits?  The materials are ensconced right there within the Bill of Rights.  Some of the ten amendments are outdated and not suited for the propagation of rage.  Quartering troops in houses?  Archaic.  Unreasonable search and seizure?  Right to a jury trial and reasonable bail?  Perhaps, but if you obey the law – like any of our salt of the earth listeners – then it isn’t pertinent, is it?  State’s rights?  Not since 186…never mind.  Just go to the first two amendments right up front:  religious freedoms in the First Amendment and gun rights in the Second Amendment.  The rancor of the past two decades has built within these two amendments but it has been stirred, spiced and served on a scalding hot plate in our laps by our Chef Executive.

We are near the culmination of the Conservative drive for power and money.  The Conservative Media has relentlessly pushed fear and anger and the President has mastered it, wielding it venomously in a strategy of Divide and Conquer.  To secure his election in 2016, he divided us from the world and in the aftermath of the inauguration, proceeded to remove or threaten to remove us from multiple international treaties.  When he viewed the push back demonstrated by the Women’s March after his inauguration, he narrowed the Divide and Conquer Strategy to focus on the nation itself and found his ammunition in the first two amendments of the Bill of Rights.  He has openly stoked his followers with fears of religious persecution and the threat of a repeal of the Second Amendment.  A call to “Liberate Michigan!” via Twitter led to his supporters bringing semi-automatic weapons to a rally at the state Capitol.

Civic insanity.

Our nation has had two other encounters with governance according to the Me.  The first was the original Articles of Confederation ratified at the end of the Revolution, which created a Federal government that was only a weak shell and ceded almost all power to thirteen states.  It went so well that six years later, the Articles were replaced by our Constitution.  The second was the Confederacy.  Nominally a nation of sovereign states that heavily espoused states rights.  By the latter half of the war, the Confederacy suffered crippling problems as different states opted to withhold money, supplies and men from the central government in order to support their own needs.

Some of our greatest national moments occurred during the Commonweal moments of the We.  We eliminated slavery through a Civil War which incurred more death and national destruction than any other war in our history.  We beat totalitarianism and did it twice in a quarter century, almost just to prove a point.  We expanded our educational structure during these conflicts through a series of Commonweal political acts – The Morrill Land-Grant Act of 1862 and The Servicemen’s Readjustment Act of 1944 during two of these conflicts.  We put a man on the moon and expanded the frontier of space because as a society, We willed it so.

We have now lost more than 90,000 of our citizens as I write this and an untold number of thousands of those deaths could have been prevented.  Our Chief Executive minimized the notice, hampered preparation and then abdicated all responsibility to the individual states, who have been left to fend on their own domestically and internationally.  Don’t like social distancing and lockdowns?  Look to Washington, DC and ask if things might have been different had 50 individual governors not had this dumped in their laps.

Once again, the Me has failed.  It’s time for the We.

 

 

Re-Boot: The Pandemic Food Price Index (FPI)

What is happening to the price of a market-basket of food due to the economic effects of the Covid-19 Pandemic upon:  (1) the upheaval in the supply chain; (2) the collapse in aggregate family income?

This two-pronged question is the reason for the resumption of the PracticalDad Price Index after an almost four year hiatus.  We know from the US Department of Labor’s report for April 2020 that food prices rose by the highest monthly amount in 46 years due to the supply chain upheaval.  It’s bad, but it only gives for general food groups (meats, vegetables, etc) and doesn’t go into further depth than that.  This kind of information will also miss the impact of the supply chain’s efforts to mitigate the cost increases and attempt to keep foods affordable for the shopper.

The modified index (for the original Index introduction, see here) will focus solely upon the original 37 foodstuff items from the original index, broken into categories of Meat, Dairy, Bread, Staples, Cereal, Produce and Grocery items.  The pricing will occur within the first five days of each month at the same three groceries, each unrelated to one another.  The groceries represent three separate tiers of size:  local, Mid-Atlantic regional chain, international chain.  The prices for the items from the three stores will be averaged and the the mean prices added to find the total cost for the composite basket.  The total for the composite basket as of the pricing for May, 2020 will serve as the index baseline of 100.  The total for the month composite baskets moving forward will be likewise totaled and their results shown as a comparison to the initial index level of 100.

Caveats:

  1.  This is not meant to be representative of national trends.  This is three store survey in a single county and is meant to be a data point in a larger picture.
  2. I will discontinue the Index if I believe that the supply chain is so kinked that I cannot present an accurate picture in good faith.
  3. I cannot objectively verify inventory quantity within the stores but I can provide anecdotal commentary about what I am seeing and that can serve as anecdotal evidence.
  4. Within the past month, I have noted that products that are simply gone from the supply chain have not only disappeared from the shelves , but the shelf labels themselves have been removed or covered over with blank labels.  If the item is not on the shelves but the label is present, I will treat that item as temporarily out of stock and report the price as listed on the shelf label.
  5. The items priced are almost all store- or off-brand, which would be purchased by a shopper attempting to extend a fixed food budget.  There are rare instances in the Index in which a name-brand product is used and that same product will be priced moving forward to assure consistency.
  6. Pricing will occur, whenever possible, in the morning.
  7. If new alternatives are offered for an item, as happened continuously in the old Index, that alternative will be used then and afterwards to assure consistency.  The same will happen with package sizing.

The May 2020 FPI results are shown in the linked pdf below.  Note that a few items are not listed in two columns; these items were part of the original survey and they were not available in those stores, even searching for shelf labels.

The Total Cost of the May 2020 FPI is $88.51 and that amount will serve as the Index level of 100.

FPI Base Results – 5/20

 

 

 

Life in a Time of Corona: Accommodations on “Re-Opening”

Mr. Murdoch, what are your orders?

Full ahead and no course change, Mr. Hichens.  Let’s see if Titanic lives up to her press!

It’s abundantly clear that the social distancing effort will be abandoned and the process of “re-opening” will move ahead, damn the cost.  The question now is this:  what accommodations should we make to live in a society which demands that life returns to pre-pandemic patterns despite the ongoing presence of the virus that disrupted those patterns in the first place?

My family’s personal adjustments will be driven by what we decide because there is no longer any meaningful public health guidance from the government.  The incompetency is glaring and stunning, all the money that we have invested over decades in a federal public health infrastructure to help manage such events completely pissed away.  After ignoring and downplaying the virus so that the impact was worsened, the President finally issued a framework for managing a return of societal functions over a two week period of virus metric declines.  Only a day later, he undermined it with a series of tweets to “Liberate” three separate states from social distancing and lockdown measures.  That none of these three states even came close to meeting the new guidelines was irrelevant.

The majority of states are now moving ahead with “re-opening” despite any lack of control of the virus that even meets the President’s own metrics.  Neither is there any meaningful testing to ascertain the spread of the virus until it shows up to burn through through a locality’s hospitals.  Indeed, the President has effectively removed any public health aspect from this process by shelving the guidelines set out by the CDC.  The guidance for a public health pandemic is now managed solely by political and economic criteria.

What is happening is, in a sense, a darkly hilarious irony.  A verbose and gun-toting minority – in their fear of any potential abridgment of their preferred freedoms under the Bill of Rights – embraces and lifts up a Chief Executive who has actively transferred all responsibility for management and action for a national crisis to the states, resurrecting a style of government which existed last under the post-revolutionary Articles of Confederation.

You remember that one?  Yeah, that one.

The one without a Bill of Rights.

Because things can’t get any more local than the molecular level of the family, what might we consider?  The important point to remember is that we must somehow lessen our risk and decrease our exposure to the virus if we cannot socially distance or isolate ourselves.

First, consider how to manage with elderly parents and other relatives.  What are the contact and exposure rules if you have to visit or take them to appointments?  What is the status of their paperwork and executors?  What is the default plan in the event of your own illness?

Second, make sure that the personal affairs are in order.  Take to heart the philosophy of The Next Man Up.  Assure that the wills and various powers of attorney are in order should they have to be utilized.  This also means considering the inclusion of secondary executors and decision-makers.  Note the critical passwords and pass that information to your executor.  While the virus most impacts the elderly and immune-compromised,  there are all age levels in the ICU and even children are being affected with their own issues.

Third, make a re-usable mask part of the daily routine.  The notion of a truly disposable mask is dead as even healthcare providers are having to extend their usage for lack of availability.  I don’t know enough about the availability of gloves but anticipate that I will save those for high traffic public areas such as grocery stores.

Fourth, assure that there is hand sanitizer in every vehicle and use it after each venture out of the vehicle.  That also means finding an alternative source for hand sanitizer and re-using the existing bottles if the replacement sanitizer comes in large quantity containers.

Fifth, consider the use of a small notebook in the glove compartment to note where I’ve been on different days in the event that I contract Covid-19 and contact tracing efforts are made.

Sixth, broaden the family’s food supply chain so that there’s not a complete dependence on the grocery store.  If possible, plant a garden or join a CSA to provide a wider access to a dependable source of food.  Even within the grocery store, consider widening your preferential supply chain by purchasing food items not being purchased by everyone else.

Seventh, what is the process for returning home from work or another outside exposure?  This is a real thing for healthcare workers in hard-hit areas because they don’t want to expose their own families.  What processes should you adopt within the household?  It might range from disrobing in the garage and leaving clothing in the laundry room prior to a shower, to a simple hand-washing upon returning home.

Eighth, decide whether the trip or errand is worth the exposure.  Do a more thorough job of planning so that only one trip is required instead of multiple return trips.  If it isn’t necessary, is it sufficiently important enough to justify the exposure?  Visiting a movie theater might not be worth the risk, but traveling out of state to take a kid to college for the first time?  That would likely be worth the risk with proper precautions.  Assuming that it happens, of course.

Ninth, reconsider the shopping habits.  In this environment, ignore the economic establishment thinking that the public is hoarding cash and ratchet down the discretionary spending to what is necessary.  If you do have money available for discretionary spending, then give serious thought to directing it to the food banks that are now serving a significant portion of our citizenry.  Consider another charity or simply rebuild your own finances to your comfort level.  If you shop online to avoid exposure in a bricks-and-mortar store, decide if Amazon is the go-to site or if it’s possible to spread that cash to other online stores instead of further enriching Jeff Bezos.

This is meant to be a point-of-departure for the planning moving forward instead of an exhaustive and comprehensive list.  Consider your own circumstances and risk tolerances.  But do it now so that you are ready for when the re-opening takes place.

Resurrecting the Price Index: Rationale

We are again in Terra Incognita and our only guides are a few accumulated studies of a hundred year-old predecessor pandemic.  This is like trying to find the most efficient route from New York to Salt Lake City using a 1932 Rand McNally map.  The fear is palpable and not least of which is the concern about the national food supply, especially since John Tyson of Tyson Foods took out full page ads warning that the food supply chain was breaking.  While this piece was going national, there were also warnings about the virus having an inflationary impact on food prices.  Are there serious problems?  Absolutely.  Are they as terrible and fear-inducing as it appears?  Not necessarily.

Societal shocks happen and they are always followed by fear, if not outright panic.  Our history is that we have had problems with food prices and supply before, most notably during the Second World War, and we managed to survive.  What is different is that Franklin Roosevelt’s government had sufficiently advanced notice that there would be another war and had begun thinking ahead.  Today?  Well…that depends to whom you are talking.  The simple reality is that there are no easily ascertainable data points to assess developments at the retail grocery level and the lack of data feeds uncertainty and fear.

This is why I am resurrecting the original PracticalDad Price Index – which I calculated monthly from November 2010 to September 2016 – and modifying it to follow activity within the grocery stores.  The original index was created as a kitchen table project to ascertain the impact of the Federal Reserve’s novel Quantitative Easing programs upon food prices in my vicinity.  It was calculated both to satisfy my own curiosity and to serve as a small data point for a larger online community.  It’s one thing to read wonkery, but another to actually see it in concrete terms.

The modified market basket, methodology and results will be covered at length in the next article.  For now, let’s go from pondering questions of inflation at the molecular level of three local grocery stores to a more global perspective on prices and inflation.

Understand that inflation is simply the decrease in a currency’s value, as measured by it’s purchasing power for goods and services.  There are three principal reasons for this.

First, there is demand, such that people are willing to spend more for that item with the supply of that item being relatively constant.  The stunning rise of a single Bitcoin is an example of that but that glorious moment in our history when Americans believed that a house was an ever-increasing investment works as well.  Our realization that a house wasn’t so is a good example of the inverse, deflation.

Second, an inflationary or deflationary effect can arise out of a good’s supply.

The oil supply shock of the 1973 OPEC oil embargo caused prices to spike simply because there was an immediate halt to the flow of oil to the US with no corresponding decrease in demand to offset it.  In economics parlance, this was a simple shift in the supply curve to the left with demand being equal.  The shift from Intersection A to Intersection B resulted in a rise from a price of P1 to a price of P2.  Real life, unfortunately, was quite a bit messier.

Finally, the purchasing power of a currency can be affected simply by the sheer amount of money available within the system.  What most have forgotten is that inflation for food – particularly meats – was already an issue prior to the 1973 Embargo.

There were calls by housewives for “Meatless Meals” as a push-back against grocers and protests broke out across the country.  Housewives blamed grocers and the grocers pointed their fingers at farmers, who kicked the can of blame to the feed producers.  Where did the final responsibility rest amidst this idiot firing squad?  Actually, it was a result of the persistent and signficant increase in the amount of money within the economy starting in the 1960s.  The Federal Reserve itself terms that era as The Great Inflation and notes that the period began in 1965 and ended in 1982.  Why those years?  Because 1965 saw the beginning of LBJ’s Vietnam build-up as well as the inception of his Great Society programs.  And 1982?  That’s when then-Fed Chairman Paul Volcker turned off the tap and ratcheted interest rates to nosebleed levels to rein in the resultant inflation.

There is nobody – absolutely nobody – who can tell how this plays out in the grocery aisles.  There are competing articles about incipient inflation and incipient deflation, which is really where the mass of Americans have been stuck since 2009.  So take a side and argue away because each argument has merit and honestly, the act of arguing serves nothing better than to satisfy a primal intellectual urge, a form of mental masturbation.

What this C-19 Pandemic has managed to do however, is create a situation in which all three factors are now simultaneously in play amidst the real economy.  In the short term, the supply of specific food groups is curtailed and all things being equal, there should be a spike in the prices for those groups.  But all things are not equal here because while there’s the supply question, the American people have suffered a cataclysmic – and that’s an appropriate word for these circumstances – demand shock in loss of income, strained as it already was for the past decade.  Refer back to the Supply/Demand chart shown above.  The family income supported Demand curve hasn’t so much been shifted left as it’s been tossed into the bottom corner like a broken corpse.

Our present drama is playing out amidst these first two factors of compromised Food Supply and cratered Family Income, contesting one another like fighters in the late rounds of a championship bout.

But the third factor, the Money Supply, is waiting quietly outside of the ring and that is what literally awakens me on the occasional night.  In the wake of the 2008 Financial Crisis, the Fed’s three QE programs created trillions of dollars and in the process extended the Fed’s balance sheet to amounts previously unimagined.

Growth in M1 (1975 – 2015)

That it didn’t tear Joe Six-Pack a new one is a testament only to the fact that the economic, legislative and electoral policies since the repeal of Glass-Steagall literally created two stand-alone economies:  one awash in wealth for the uber-wealthy and another that diminishes the American Middle Class a little bit more each day.

My wife once asked me, if the goal was to create inflation, where is it?  The inflation is there.  It is encased in the equity markets and the prices for exclusive properties in places like New York, San Francisco, the Hamptons and Potomac, Maryland.  It is encrusted in the wealth accrued to billionaires and near-billionaires and their purchases of art, excess consumption and doom shelters in New Zealand.  It is wrapped up in projects such as Jeff Bezos’ effort to create a ten thousand year clock as a monument to long-term thinking, the vicious irony being that it’s financed by a predatory reliance on short-term quarterly results.  And the inflation is locked away in the purchases of items of alternate value such as cryptocurrencies and precious metals, which are now physically almost unobtainable despite having a stable paper price.  Go figure that one out.

As global economies pursued this race to the bottom with their respective currency values, the Fed acknowledged that it had to begin raising interest rates to something remotely approaching historic normalcy.  It’s not surprising that the stock market became cranky during this period because it’s flow of cheap credit was threatened.  There’s a reason that President Trump demanded zero and negative rates from the Fed, regardless of the damage that these rates do to real activity.  But in the immediate aftermath of the Pandemic’s onset, the response was to salvage the economy by again dropping rates and extending lifelines to a wide variety of corporate and financial entities.  The result of these lifelines from the government and the Fed?  $6 Trillion in the course of the two month period ending April 15, 2020.  That money is now coursing through the bond and equity markets, which have stabilized since the roll-out of the various programs.

Yet the average American gets a one-time check of $1200 with an additional $500 per child.

At the end of the day however, our economy is built upon the premise that Americans must spend for any recovery to happen.  That’s why the Administration pushes to get the economy re-opened and money flowing, even though the infection and fatality numbers in many areas still fail the President’s own criteria for re-opening.  That is why we hear establishment commentary conflating legitimate saving with ridiculous terms like “hoarding cash”.  Sure dude, I can’t cover a $400 car repair but yeah, I’m good for a beach week to help the economy.  Ultimately, the average American will not be able to consume unless the Federal Government renders real and meaningful assistance and the two bifurcated economies are rejoined in even the loosest fashion.  Whether it is debt relief, guaranteed income or any number of other programs that remove the noose from the neck of the 99% and/or ratchet down upon the 1%, the economies must be rejoined and a re-balancing must take place.

That’s when the trillions of dollars set loose since 2009 are liable to return.  If it happens, that money will begin flowing through the real economy and we will be set up for a replay of The Great Inflation, except that the Americans of this generation won’t have the financial health of their great-grandparents to survive.  The resultant inflation will ignite and what we witness in the next year will be child’s play in comparison.

It is possible that these fears won’t be realized.  But make no mistake that the American economy – and the political body – is seriously ill.  One of the criticisms of the repeated actions of the Fed’s QE programs is that it’s akin to treating cancer with copious amounts of painkillers.  The patient feels better but the cancer continues unabated.  At some point, the treatment must occur in all of its unpleasantness.  As a survivor of cancer and any number of other medical issues, I attest to the value of a painkiller in the moment; I also understood in the moment that my survival was predicated upon a simple submission to the treatment and all of the side-effects.

Apart from the sheer ability to draw breath for yet another day, there’s an upside to survival.  It is the understanding that despite the worst fears in the moment, they are at that time, only fears and not guaranteed realities.  You learn to acknowledge the fears and set them aside, managing your life one step at a time and taking each step as it comes.  The fears are there.  They are real.  But until they actually occur, they can be managed one step at a time.

So it will go in the grocery store.  We will manage as best that we can because that is ultimately all that we can do:  our best.  In the meantime, I will work to put a recognizable face to the abstract notion of the cost of food and the reality of the supply chain.  That will be the next article:  The new Market-basket.

 

After High School: Helping Find the Path

I wish that I had known that I had the option to go to trade school…

It was a simple comment uttered by Eldest as were driving together, her toddler daughter buckled in behind us.  It was also one of those remarks that grabs you by the scruff of your cerebellum and shakes loose an unheard huh?  She was quick to note that that she was thankful for her education – a Bachelor’s degree – but increasingly she had found that she enjoyed the process and reward of working with her hands.  I took – take – no offense despite the mental response but it’s a comment that has raised a larger question in the past several months:  How do we, as parents, help our kids ascertain their educational path after high school?

The question is especially germane today.  It’s now clear that some form of further education is necessary for most to avoid a lifetime of minimum wage jobs, but the pathway for such a crucial life decision is booby-trapped for many.  The tripwire is that higher education – Big Ed, as an acquaintance referred to it – is a business that requires a steady stream of bodies to fill the seats of the lecture halls.  The Claymore mine is the realization that there’s a clear discrepancy between the living-wage jobs available and the education required for hiring.  We’ve turned out a plethora of liberal arts degrees but there are few of those graduates with the skill set necessary to run a CNC machine.  The Punji stick is that the decline of the middle-class family has shifted the responsibility for educational financing back to the student herself; the likely accumulation of debt will eliminate the opportunity to repeat the process again.  Don’t hold your breath if you’re waiting for any college to say we’d love to have you here but we’re gonna give you a pass because honestly, it’s too much debt for you to handle.  That depressing commentary will have to come from you.

Full disclosure:  We have delivered this message to all three of our children and doing so sucks.  Hard.

I’ve thought about Eldest’s comment repeatedly in the ensuing months.  My second immediate thought was a defensive yes, you could always have opted for trade school but that’s really not the truth.  It’s not the truth because the trades weren’t a pathway made clear to her as an option through the myriad conversations across the tween and teen years.  My mantra from her middle school years starting in 2007 was we have to get you educated with as little debt as humanly possible; I was looking at the trends and numbers and recognized that student debt could be a serious impediment to a decent adulthood.  I could follow the economic news and extrapolate that back to my family at the molecular level of the economy.  I could even see that the living wage jobs were swinging back to a STEM orientation and skilled manufacturing.  But the simple reality was that the skill set that I knew, with which both my wife and I were raised, was rooted within the route of college and the liberal arts and that was the consequent focus with our kids.  My own upbringing was in a corporate mid-management level household and in my teen years, the parental conversation was to push for a degree that enabled me to make a living for myself.  It was what my parents knew.  My father was a product of the mid-20th century corporate environment and from his viewpoint, and my mother’s by extension, there were always going to be corporations that would afford a reliable income and retirement to dependable, smart employees.  My final college decision was based upon a school with both strong journalism and business programs.

Many of our life choices are informed by what we learned in our upbringing.  Working with my hands was not a significant part of my early life.  I helped my father remodel the family basement and learned to perform essential maintenance upon my car but that was stuff that my parents considered what any functioning adult should know.  There were other opportunities afforded to me by my father but I didn’t find them of interest and he didn’t push me to learn.  When I did talk to him about following him into computers during my teens, his literal response was Hell, no.  I can teach a goddamned monkey to write programming but I can’t teach one to write a proper paragraph or speak in public.  So it was the liberal arts for me, which was good because I found in college that I was, in some respects, dumber than a goddamned monkey.

So, what if I’m raising a child amidst a time of tremendous change?  What if my skill sets are not applicable to an economy in flux?  Like any other part of parenthood, there are few exact answers but I will offer the following.

First, remember that there’s a goal to parenthood:  you are raising your child to to walk out the door and support herself.  It’s the goal from the first delivery room cry and one that threads throughout her years with you.  What it means is that you don’t wait until her junior year in high school to attend a college financing night and then ask her so, whaddayawannado?  I’m not saying that it’s the credo that you tell yourself every morning when you look in the mirror but it is something that remains within the back of your mind, especially as she ages and moves further along to more diverse options within the educational system.

You must become intentional in your parenting.

Second, you have to pay greater attention to the culture and politics around you.  Foremost, understand the difference between news and news commentary and act accordingly.  It’s telling that during the past week of this Covid-19 pandemic, the most watched news programming is now ABC Evening News and not the news networks.  Pay attention to different sources of information and check for veracity.  It’s time-consuming but the good news is that we now an insane amount of information available instantaneously within our phone’s grasp.  Or you take to heart what my father said to me routinely:  pull your head out of your ass and look around.

Third, you’re going to have to be almost countercultural with your child in terms of screen and electronic media consumption.  The hours spent in front of a screen have obviously increased and there is little to indicate that the trend will reverse anytime soon and it will simply have to be part of your routine to monitor platforms and hours and listen to her kvetch around boredom (despite the simple fact that there can be value in children contending with boredom).  But it’s crucial that she learn to pay attention to the world around her and she won’t do that immersed in a screen.

Fourth, try to provide a wider variety of opportunities for her.  If you know hunting and gardening, then do those things with her.  But don’t be shy about crossing things up and taking her to an art exhibition either.  A large part of parenting is moving outside of your comfort zone.  An inveterate reader?  Great.  Read to her and then go hiking with her.  It not only provides a wider perspective of the world but also an opportunity to appreciate her budding personality.  One of the eccentricities of the past several decades is the proliferation of expensive advanced-instruction youth sport leagues.  The catastrophic loss of jobs and income from this pandemic is going to put a crimp in that business model and the opportunities will most likely devolve back to the parent coached/run Little League model.  It’s going to be incumbent upon you as a parent to make those opportunities happen, even if you have no experience with that.  Honestly, some of the best coaching that any of my kids had were parents with no previous experience.  Thank you, Rob, Jeff and Scott, wherever you are.

Fifth, figure out how you want to handle praise and criticism.  The first is critical for toddlers and small children but how are you going to begin balancing the two as she grows?  Boundless praise is meaningless and boundless criticism is fatal.  Ascertain the development norms for age levels and move from there.  Think about your style of delivering each and what you and your partner provide.  My kids learned that if they really wanted to parse performance for constructive criticism, the go-to person was my wife.  I, on the other hand, actually gave at least one of my kids a rousing comment of Don’t Suck before games.

Sixth, pay attention to the guidance and course suggestions that she will receive from school, especially as she ages.  Parents and teachers are natural allies but systems are built to serve the large majority of students and there are liable to be instances in which she is not part of that majority and will not be served by the recommendations.  Pay attention to what she brings home and listen to what she’s saying, then don’t be shy about calling to verify what you’re hearing.  Kids commonly mangle what they’ve been told but there can be circumstances in which they are absolutely correct.  This will come into play with course selections and loads when she’s older.  Fortunately, our experiences have been positive and the administration has been willing to work with us on multiple occasions.

But it wouldn’t have if we had missed the occasions.

Seventh, let her fail and hold her accountable for failure.  Be clear about your expectations and then do your best to hold her accountable.  It’s an immensely tricky and subjective topic:  Are my expectations reasonable?  Are the repercussions reasonable?  Are there legitimate mitigating circumstances?  How do you respond if you mishandle it (and believe me, I have done that)?  The corollary is that you should be willing to share some of your own screw-ups.  There is plenty of commentary about developing resiliency in kids but I think that the most critical element is learning that mistakes need not be terminal and that they can be overcome.

Finally, just because you believe that you are deficient in something doesn’t mean that she will be.  Part of the joy – the adventure – of being a parent is watching your child develop into the adult that she becomes.  If she comes to you with the wish to do something with which you are aren’t familiar, or just dislike, don’t automatically dismiss it.  If possible, find an opportunity to let her experience that thing with someone who is both capable and trustworthy.

I’m sure that you’ll come up with other points after reading this, since this is truly only a point of departure.  But remember the takeaway:  you, more than anyone else, have the critical role in helping her ascertain her future path.  The capacity to fund it, fully or even partially, is irrelevant.  What matters is that through the next eighteen years of her life, you and your partner will be the ones to raise and guide her, who know the fullest extent of her capabilities and have her true best interests at heart.  And the best interest is this:  allowing her to enter adulthood as a productive and moral adult with the capacity to move ahead in her life.

After that, the rest is on her.

Notes on the Supply Chain

As the country leans into a lockdown and fear intensifies, there is another side-bar conversation about the strength and/or fragility of our supply chains.  Our out-sourcing of pharma and manufacturing has bitten us in profound ways but apart from ventilators and PPE, that is a step removed for many.  The immediate concern for most pertains to the food supply chain, which adds yet another layer of tension to an already fearful scenario.  Large numbers of people now enter the grocery store intent on finding what they can before they are potentially gob-smacked with someone’s aerosolized germs.  But what is notable about this grocery scenario and can we draw inferences for moving forward?

Yes, there are.

Let me start by explaining my background.  First, I have not only been the stay-at-home parent who has done the bulk of the shopping and cooking for that time, but I am also a data-driven economics geek.  My wife, BH, now takes a greater role than earlier and much on the generated lists now emanate from her facile mind.  But in the early years of toddlers and small children, this was predominantly my responsibility.

Where this merged with economics was in 2009-2010, in the aftermath of the Financial Crisis and deep recession.  At that moment, the Federal Reserve Chairman was Benjamin Bernanke and it was clear that The Powers That Be had advance notice of problems at his 2006 start; his area of academic expertise was in the errors of the 1929 Fed in responding to that year’s Depression.  Bernanke had argued that the Fed exacerbated the stock market collapse by failing to provide liquidity for the market as it  struggled.  His response, unproven and academic, was that the Fed should have provided as much liquidity as possible and the collapse in late 2008 provided the opportunity to test his theory by supplying liquidity via the first of multiple rounds of Quantitative Easing.  The debate, loud and rancorous on Economics and Finance blogs, was whether this untested theory would work or instead spark rounds of runaway inflation.  My own questions went to how this would affect my own family.  Because I was involved in the establishment of a local cost-of-living survey in my distant past and had spent time conferring with its national creators, I decided to lever this experience into the creation of a kitchen table project, the PracticalDad Price Index.

The Index kicked off in November 2010 and focused upon a market basket of 47 common grocery items.  My intent was to see what happened to the prices of this local basket as the QE program – and its successors – rolled through the economy.  It continued monthly until  personal circumstances dictated it’s ending in September 2016.  An offshoot of this focus upon pricing for almost six years was a new appreciation for the food supply chain.  It’s not typically notable unless something is wildly amiss, such as a run on toilet paper in a pandemic but over that span, there were distinct changes in the grocery supply chain as grocers and suppliers adjusted to the ongoing decline in purchasing power by a weakening American consumer.  What is notable about the supply chain?

First, the name itself is misleading.  We talk about the supply chain as though it was a singular monolithic entity with a single controller, but it isn’t.  The supply chain is a dynamic – almost organic – entity, involving the input of hundreds and thousands of retailers and suppliers in a geographically and economically diverse nation.  It evolves over time to respond to the data fed to it via market and economic research and the sheer volume of literally billions of transactions involving an untold number of products at different price points.  It is continually changing as grocers and producers meet consumer changes in spending power, habits and trends.  Some entities fail in bankruptcy or are taken over by competitors.  Others offer cheaper alternatives for sale to the consumer.  The point is that it can and does change in real time.  Personally, I don’t envision so much of a chain as the visible sinews and tendons of the economic body working both individually and collectively at the same time.  One sinew would be dairy and another produce, yet others involving meat sources and consumer non-durables such as health and beauty products.  Each sinew answers to distinct inputs and trends with the collective result of an economy reliably providing needed goods to the consumers.

Second, the supply chain is built to respond reliably within a certain timeframe BUT the pandemic has shortened that ruinously.  The inputs that drive the process are now wildly disordered and the processes are momentarily overwhelmed.  The consumer, already declining, has had a catastrophic loss of income.  Entire sectors of the economy are suddenly and completely closed.  There is an immense and out-sized need for certain items, particularly related to disinfectants and cleaners, that utterly outstrips the ability of those sinews to meet those needs.  There is concern that the food sinews will be compromised for fear of viral infection among those workers.  This doesn’t even touch upon toilet paper, the disappearance of which suggests that most Americans believe Covid-19 will completely deforest the continental United States.

It was reported this week that dairy farmers in some regions were forced to dump raw milk, an infuriating development when millions are suddenly unemployed and food banks increasingly stressed.  My original take was that it reflected a collapse in dairy pricing, as occurred during the 1929 Depression; in that period, farmers and herdsmen destroyed crops and dumped milk because it was the only way to bring supply into equilibrium with a break-even point that supported even minimal prices.  Another article explained the rationale behind the decision to dump and while immensely frustrating, it makes sense.  In the Great Depression, episodes of dumping only occurred after years of being mired amidst years of poverty that wouldn’t support even minimal prices.  This episode is founded again upon the concept of time; the inability of dairy producers to find the packaging that would allow the product to come to market to meet the suddenly soaring demand.  The supply chain is not built for and cannot adapt to a shortened time frame.

Third, the factor of time now also drives many of our shopping habits.  American workers and families have felt the pinch of demands upon time and this has carried over to the grocery shelves.  Many products are now processed in some way or pre-packaged with the intent of minimizing the time required to cook and serve.  The cost for such products however, is driven upwards because the much of the labor for preparation has been taken up into the manufacturing process.  In essence, time truly is money and it’s a trade-off that many Americans have made for decades.

Fourth, observations from recent grocery trips indicate several things.

  • The scarcest items are those that either require the least amount of household labor to prepare or require a higher amount of pre-market processing or travel in order to bring to the shelves.
  • The produce sections at the entrances of multiple groceries have been consistently well-stocked, except for lettuce (which is hilarious since my wife routinely reminds me that lettuce is mostly water and the least-vegetable vegetable on the planet).  I have been surprised to find that bananas and citrus are still plentiful although that might change as the travel network degrades.
  • Canned goods have been in persistently high demand for their long shelf life but they have remained available; this is liable to change if the virus depletes the workforce in the plants.  Likewise for canned soups, pastas and sauces, peanut butters and orange juice.  There are instances in which there are less popular types of canned vegetables or beans in greater quantity as people ignore them for the more commonly preferred types.
  • Non-dairy and specialty milks (Lactaid/soy and almond) have been depleted but there has been a reasonable supply of locally sourced standard milk (whole, 2%, non-fat).  Likewise for yogurts and cheeses.  Specialty yogurts requiring greater processing are depleted while simpler yogurts have been there in sufficient amounts.  Locally sourced and block cheeses are available while the shredded variety is more depleted.
  • The meat cases were sporadic.  I’d noted lesser amounts of ground beef and boneless/skinless chicken while there were still sufficient amounts of other meats.  This observation was confirmed on the grocer’s website with the note that price was higher and availability more limited but that this should remedy itself within the near future.  Eggs were in sufficient amounts but the price per dozen had almost doubled and the grocer noted that that should revert back to norm shortly.
  • Breads were completely out of whack as those products requiring further processing are in short supply:  Schmidt’s 647 loaves are a prime example.  Other popular standards were sold out and one local grocer was replacing them with simply store baked white bread loaves.  My experience with one of those was that it grew mold far more quickly than its commercial bakery opposite, indicating a lack of preservatives.
  • While there’s been consistently brisk movement in canned vegetables, I noted on occasions that the 19th century predecessor, glass jars of pickled vegetables, were almost untouched.

What are the takeaways moving forward?  I’m operating under the premise that this pandemic will come in waves, like it’s 1918 Spanish Flu epidemic, and is likely to last into 2021 before ending.

First, the supply chain will reassert itself and adapt to the new conditions of problematic supply/processing and fewer consumer dollars.  The gist will be to save dollars by shifting the labor cost back out of the factory and into the household.  For example, instead of spending money on highly specialized yogurts, consumers will opt instead to purchase the simpler variety and add their own fruit or flavoring.  Instead of spending on canned beans, consumers will opt to reassert their time in the kitchen by remembering to put dry beans in a pot of water the evening before cooking.  Food preparation will become a more deliberative and time intensive activity as it was for our great-grandparents and forebears.

Second, consciously or not, people will begin to expand their own food supply chains so that they aren’t reliant on a grocery store.  I expect a return to gardening with the rise of the Corona Garden, much as the Second World War saw the rise of the Victory Garden.  As stay-at-home orders have rolled out across the country, there has been a significant increase in seed sales as well as a near sell-out of chicks.  Communities are likely to follow their 1970s  predecessors and set aside lands for more community gardens for those who do not have sufficient personal space to support a garden.  Another example of this would be our joining a CSA last year for produce, cheese and eggs.

Expand your supply chain within the store itself.  Seek out alternative foods that are more plentiful than the standards and try them.  Middle is presently back in the household for the duration.  When he joined me the other week at the store, we were discussing his new appreciation for Indian and Halal and when we went to the small foreign food section, it was almost fully stocked with rices, sauces, spices and chickpeas.  And yeah, the guy did a creditable job on an Indian meal.  Think of it as an adventure if you’re an optimist and a you’ll eat it and you’ll like it experience if you’re a pessimist.

Third, take time to do more planning.  Consider your menu choices as you walk through the next one to two weeks and buy accordingly.  As a society, we will no longer have the money nor the inclination to meander through a grocery store browsing for the next great impulse buy.  I suspect that lingering will be a thing of the past in stores.

Finally, be mindful of others when you are shopping.  Our community’s church sponsored food bank noted a 360% increase in the number of families requesting food assistance over the course of a single week.  During non-growing periods, the food banks are going to be more dependent on canned and processed foods and those able to still get to the store will be in a better position to purchase fresher foods and cook for themselves.  Also consider essential workers and their families and leave the more easily prepared foods for them, because cooking isn’t likely to be on their agenda after a busy shift.

 

 

Declining Elders: You Should Probably Start Writing This Down…

To die of old age is a death rare, extraordinary, and singular…a privilege rarely seen.

– Montaigne, Of Age, 1575

Getting old isn’t for sissies.

– The PracticalDad’s grandmother (circa 1990)

You should probably start writing this down…

– BH, The PracticalDad’s wife (circa Autumn, 2014)

American Elderhood is terra incognita.  Our parents are living longer and yet the tide of financial assets to support them in their elderhood is ebbing, as is our own.  The structure of the family is imperceptibly changing as a result and it is up to us in the moment to figure out how to manage.  The model that we’ve known for the past three generations, retiring at a relatively early age and spending our later years with a degree of material comfort, is ending.  And it’s not just happening in the United States.  The general unrest in France is wholly rooted in the question of retirement funding and the unrest in Chile is partially rooted in anger at the status of retirement and pension funding.

Not only has the lifespan increased, but the causes and nature of death for Americans have changed as well.  At the turn of the 20th century, 120 years ago, the American lifespan was approximately 50 years and it has since risen to almost 80 years, with a few years differential by gender.  In that same span, the causes of death have shifted as well.  Back then, the top three causes of death for our elders were pneumonia/influenza, tuberculosis and GI infections whereas today, they have been supplanted by heart disease and cancer.  This doesn’t touch upon accidental death more than a century ago and the statistical rise of Alzheimer’s today; their elders died young enough that Alzheimer’s wasn’t a consideration whereas our elders won’t get offed when the family buggy is whacked by a train at an unmarked crossing.

Death was a quicker process back then and consequently, far less expensive.  Eldercare is challenging with a varied set of demands that range from assistance in ordering and managing medications to getting a declining Elder to appointments, and even attending the appointment with her.  Factor in the degradation of mental and/or emotional status that might accompany the decline and it can be highly problematic for both Elder and adult child.  My own parents were a microcosm of this disparity.  My father succumbed to a relatively short four-month course of cancer while my mother passed after a several year affliction with Alzheimer’s.  And it was early in that latter illness that BH made her suggestion:  You should probably write this down…

The suggestion was god-sent although it wound up being a far different thing at the end than at the outset.  It wasn’t a consideration for my father’s illness as his disease course was relatively fast and straightforward and he was in full possession of his faculties up to the moment of his death.  But contending with a lengthy and convoluted process like Alzheimer’s involved not just medical, but logistical and legal issues that made it the singularly most important tool in the endeavor, serving as a resource and stay against the confusion that arises out of contending with a stressful, prolonged and complex situation.  My exercise in this lasted for more than two and a half years and in the end comprised 63 typed, single-space pages with entries that only ended upon the day of her death.  But having done it and finally reflected upon it, there are some points that can be taken from the document and the process.

First, understand precisely what it is…and what it isn’t.  I referred to my notes as a journal at the outset and that, in retrospect, was a poor descriptor.  Journaling is now a practice in which someone engages to record their feelings and/or thoughts and is recommended for self-help and exploration.  Keeping notes for the process of Eldercare is wholly for informational purposes and you should expect that you will likely share at least a portion of the document with a sibling or spouse.  Full disclosure:  managing a parent with Alzheimer’s tinged with paranoid dementia led to instances of personal distress that are best left unrecorded for others.  To put it in terms of professional journalism, you are writing to cover the essential questions:  who, what, when, where, why and how.  If you are compelled to actually maintain a journal for reasons of self-care, keep it completely separate from the log notes and never mingle the two.

Second, decide if it’s even necessary and if so, whether it’s even the appropriate time to start the log notes.  It might not even be necessary, as in the case of my father.  But if you do deem it necessary to begin keeping log notes, there isn’t necessarily any hard and fast rule about when to begin.  It doesn’t just tick over automatically, such as the arrival of the first AARP magazine at age 50 or Medicare at age 65.  There should be a defining instance that drives the start of the process, and for the logkeeper, it will indeed be a process.  In my mother’s situation, it was a spate of mutually frustrating incidents for both my mother and I that led to my wife’s suggestion.  This was confirmed in conversation with my sister, who was also noting separate incidents.  Every entry that I made noted the date, except for the first entry which referenced an entire two month period followed by a synopsis of events.

Third, understand that this is something that perhaps shouldn’t be shared with the Elder.  Pride is a driving factor for many people and is especially so for an elderly parent who has raised you and saw you into your own adulthood.  It can be physically dangerous for them as they are unwilling to accept that their debility can pose significant risk, particularly in regards to the driver’s license.  Hell, I can attest to this in my own debility as my toddler grand-daughter will sometimes yell “Pop!  Cane!” if she sees that I don’t have it when we venture out somewhere.  Sweetpea, I love you to death, but please…do I have to?

The point is that while it is an invaluable tool for you, consider what their response would be were they to know.  I have met adult children who openly carry a notebook for the appointments and the elder is fully accepting.  In my mother’s case, her knowledge that I was taking prolific notes would have disastrously exploded in my face.

Fourth, establish ground rules on making entries.  What prompts an entry and what are your rules on maintaining it?  Mine had weeks between some entries just because there was nothing materially new to write.  If one daily phone call is just like another ad infinitum, what’s the point?  At other times, she simply refused to speak with me; there were a few instances when I made notes that I had at least attempted contact just for informational purposes.  But if there was a new thread of conversation, concern, allegation or news, then it was worthy of an entry.  Likewise, any interaction with another individual – doctor/nurse, lawyer, social worker – led to an entry just to help keep straight the growing cast of characters as well as their input.

The other two comments here are the need to stay current and disciplined in the process to minimize the confusion.  There were instances when I had to refer back to texts with wife and sibling to jog the memory, but that was the exception to the rule.  I also kept a small notebook in the glove compartment in the event that I needed to take a few notes after leaving her.  Finally, consider the depth of information that you are planning to retain.  I rarely wrote anything pertaining to exact medical findings – blood pressures, etc. – because that’s the purpose of the medical record.  If there was a material change in the physical or mental status and especially if it lead to some new circumstances, then I’d make the entry.  But I never saw the point of writing every last piece of data.

Fifth, expect to share this information with family.  When there are siblings involved, communication is critical to keep a bad situation from getting worse.  One of today’s boons is the technology that allows almost instant communication; texts were a lifeline with both my sibling and wife and there were occasions when we literally blew up the text feed.  But texts aren’t a great way to fully capture the gist of an extended conversation with the elder or a doctor/lawyer.  It wasn’t uncommon to follow a brief text with a lengthier email, followed by the log entry and towards the end, I simply did the log entry and then cut and pasted it into the necessary email.

It’s only been in the past two weeks that I’ve come to realize this:  Google Docs could have made my life much easier.  There are potentially thorny questions, such as who has administrative access and what are the family repercussions of limiting access; but with one sibling who was in lockstep agreement on where we were headed with our mother, it would have made life a bit easier.

Sixth, make certain that the information is backed up or printed.

If you’re a Philadelphia Eagle fan, you’re familiar with Coach Doug Pederson’s philosophy of the Next Man Up.  In the worst case scenario of your death, the document should serve as a reliable guide to what has occurred so far with your elder, making your successor’s work at least that much easier.

The last entry in my own log notes simply covers the final hours prior to Mom’s early morning demise.  There were separate notes for the logistical and legal activities that arose after the fact but it just seemed appropriate to keep them apart so they have no part of the log.  The binder then went into the bookcase and it wasn’t until many months later that I was able to read any part of it without anxiety or nausea.  There are a few entries from the month prior to her death that still affect me deeply.  But I have pulled it occasionally to read just to remind myself of certain things, and to see what can be taken from it for when my own family might be responsible for me.

And for the record, when the grand-daughter reminds me to take the cane, I take the cane.

 

 

 

So the Millennials Like Socialism…

It started as an online survey by victimsofcommunism.org and has wound its way through the media, news and social.  “It” is a survey result finding that approximately 70% of American Millennials (born between 1981 and 1996) would vote for a socialist candidate instead of a non-socialist.  It’s fed a breadth of spin-off articles breathlessly reporting the results as well as a slew of memes – many troll-created – mocking millennials.  This particular little meme crossed my Facebook feed several weeks ago.

My response?

Why so surprised?

If folks are surprised that upwards of 70% of millennials would support a socialist, then consider this percentage:  80% of millennials don’t expect to receive Social Security when they reach what we consider as retirement age.  I’m surprised that so many of the X, Boomer and Silent generations are so obtuse as to consider this news.  What Millennials have witnessed from their earliest youth is the Great Reversion, a thorough dismantling of benefits and privileges that were earned by and afforded to their elder generations:  income, education, health insurance, job opportunities…all of it.  Millennials are the first generation to be raised and come of age in this period, while their generational elders had at least some benefits of the preceding society and economy.

Maybe we need to first determine if Millennials are talking about the same Socialism as their elders.  Just remember this at the outset:  most individuals don’t reach a meaningful state of political awareness until at least their teens and what they witness during that period will largely shape their long-term political outlook.  So…what is Socialism?

There’s a distinct difference between what is meant by the two generational groups.  That the original survey came from victimsofcommunism.org is telling;  it is a non-profit organization created as an “educational and human rights foundation” (per their website) by unanimous Congressional action after the collapse of the Soviet Union.  The two principal nations – the Soviet Union and Communist China – billed themselves as Socialist and those most affected by their atrocities – including the generations of Americans who engaged in a sometimes deadly Cold War against them – will identify Socialism with the death and damage wrought by them.

Millennials view Socialism as something different however.  In the earliest years of the Millennial period, the Soviet Union was in decline and a distinct political resistance had formed in Poland.  When Millennials reached elementary school, the Berlin Wall fell and was followed within two years by the collapse of the Soviet Union itself.  The existential threat of totalitarian Socialism ceased and Millennials came of age without noting it as a meaningful factor in their lives.  As the earliest Millennials aged and were joined by their younger peers, they found a new brand of Socialism in the countries of Europe, later the European Union.  In many countries, there was free or minimally priced healthcare for the citizenry.  There was also heavily subsidized and reasonably priced higher education as well a network of state supported social programs that assisted citizens.  That these nations had free and democratic elections put a stake in the notion that Socialism, as experienced by their elders, was evil and deadly.

What Millennials hadn’t experienced, which their elders had, was determining how these programs were funded.  There’s an aphorism of uncertain origin:  if a person isn’t a socialist at 25, then he has no heart.  If he isn’t a conservative at 50, then he has no head.  Generations disagree with one another.  I once argued with my parents about taxes and drove my mother to a near-stroke by arguing that we should be willing and ready to pay our fair share of taxes; my father reminded her that I would soon be paying my own taxes as an adult and my attitude would probably change.  He was right and my willingness to yield my earnings to the government declined  dramatically when I was responsible for putting a roof over my own head.  But that dinner conversation was decades ago and despite graduating from college in the midst of a serious recession, my wife and I were privileged to enjoy the benefits of that period before Things Economic went seriously south.

How far south?

Far enough south that the youngest Millennials are through college and recognizing that the economic odds are stacked against them.  Think about it:  your hope for a middle-class life is dependent upon having some form of higher education yet obtaining that degree will leave you with an average student loan balance of $35,359.  If you land a job with health insurance, it’s increasingly likely to have a high deductible plan since more employers are shifting in that direction to offset the rising cost of having insurance whatsoever.  Fully 66% of all personal bankruptcy filings are attributable to the impact of medical bills, even with the presence of health insurance.  Housing is going to be costlier as the student debt load impacts your ability to save for a down payment to buy a house, yet the median rental cost has increased by almost 50% since 2001 (through 2015) while median household income has been static over that same period.  You will be responsible for your own eventual retirement via personal savings and expect that the Social Security net will be exhausted and closed.  And honestly, if persistent mass shootings in public venues and schools elicit nothing more than thoughts and prayers from those in power, can you actually believe that any meaningful assistance will be forthcoming that same group?

Millennials are learning how deceptive the American economic system has become.  It has been based for decades upon the notion that we are consumers with a crucial role as an economic driver first for the domestic, and later, for the global economy.  What we are experiencing is that we have instead become the consumed, fodder for the corporate predators who have gained a disproportionate level of control in society.

Yeah, it’s daunting.  If I were a Millennial, I would find it daunting.  So they will  band together as a voting bloc to push for a public response that helps them, much as their great-great-grandparents did when they elected FDR in a landslide over Herbert Hoover.  As the American Middle Class continues to erode, the Millennials are living the deterioration and are willing to forego a larger percentage of their present earnings in the expectation that their futures aren’t those of poverty and hopelessness.

One final comment.  I like Sam Elliott and if there is such a thing as reincarnation, I want to come back as his gloriously badass mustache.  But let’s do it homage by not taking it in vain on what is a meme likely created by trolls to sow further discord.  Take a moment to try to walk in the shoes of a Millennial and you’re liable to find that they can’t afford the kind with good arch support.