Summer's Economic Forecast: High Prices & Pinched Budgets | RealClearPolicy

2022-07-23 08:35:04 By : Ms. Patty Wu

Summertime means having fun in the sun, taking family road trips and making lifelong memories. These days, hardworking Americans looking to celebrate their freedoms on the 4th of July may have to adjust their plans since the price of everything is going up like a helium balloon. From rent to food to gas prices, people are paying more today for everything. That is definitely going to cut into the summer fun budget.

According to the Bureau of Labor Statistics’ Consumer Price Index released this month, “The all items index increased 8.6 percent for the 12 months ending in May.” This, in fact, represents “[T]he largest 12-month increase since the period ending December 1981.” To put it plainly, you are paying more for everything and keeping less money in your pocket for the things that matter the most to you and your family. But you already knew that.

While I could spend considerable time discussing the negative impact inflation will have on our spending power and the overall economy, common-sense Americans are keenly aware that the economy is not working for them. So instead, I will focus specifically on the record-breaking gas prices which are emblematic of the challenging economic situation we now face.

For Americans, the idea of getting behind the wheel and punching the gas is one of the purest expressions of freedom, making driving as quintessentially American as apple pie. As we get ready to celebrate the birth of our nation, emptying out your wallet to fuel up is a slap in the face to freedom-loving, car-owning, adventure-seeking people we are.

According to a recent CNN Business article, Arie Kotler, who is the president and CEO of Arko, said this about driving customers, “They’re still coming to the pump but they’re recalculating their road trips.” Kotler adds, “Compared to the same time last year, people are coming more frequently to the pump but instead of fully filling up the tank, they are filling half or a quarter tank at a time. They are driving less and short distances.”

And, if you are lucky enough to live in California, where gas hit an all-time of more than $6 a gallon back in May, you are definitely not going to see lower prices in the rearview mirror anytime soon. Imagine, for a second, that you are not talking about driving around to enjoy the summer but to go to work instead. That means higher gas prices eat up your check faster.

Doing math on the way to the pump and/or reducing the distance driven to fit an already tight budget hardly seems like the thing Americans would be doing in 2022 to celebrate their independence from a tyrannical monarchy.

While we have heard a litany of explanations for why gas prices are high such as Russia’s invasion of Ukraine, the cost of crude oil, low supply, etc., the result is that gas prices are taking huge bites of the family budget and are forcing people to make choices they did not have to make as recently as a year ago when a June AAA report indicated the national average of gasoline was $3.07. A year before that, a June 2020 AAA report indicated the price per gallon was $2.13. The bottom-line: In the last two years, Americans have seen the price of gas double and triple in places like the Golden State. Just like wages, right?

For hardworking families, it matters little what factor or factors are driving prices up. What matters even more, is putting forth a solution that drives prices down permanently. We entrust our elected leaders to produce practical solutions, not merely to point to the problem or make a lame effort to solve it.

As John F. Kennedy once said, “Our problems are manmade—therefore, they can be solved by man. And man can be as big as he wants.” Like JFK, I also believe that we can solve any problem we face, provided we have the political courage to face down the status quo defenders and the ironclad will to implement long-overdue solutions that finally put Americans and their families first.  

More than ever, we need leaders and policies that treat Americans like people, not just mere numbers. It is time to put the thinking caps on and leave them on for good.

This 4th of July, we should all recommit ourselves to building a country that works for everyone. We need to make things affordable again so that people can live, work and travel without having to worry about making ends meet. We are better than that. We are Americans. We should talk to each other about how we can ensure that American Exceptionalism does not give way to American Mediocrity.

Let us hold our elected leaders accountable but let us also hold each other accountable. Remember, irrespective of which party is in power, creating a strong economy that puts people to work and makes things affordable should always be the highest priority for all Americans across the land, particularly those we entrust with our wellbeing.

This year, let us free ourselves from the belief that there is not much we can do to make things better. There is a hell of lot more we can do! We just have to start by living up to what it means to be a free American.

Luis R. Farias works in government relations and strategic communications.