News / USA

    Americans Feeling Pinch from Inflation

    Multimedia

    Jeff Swicord

    Inflation is hitting U.S. consumers hard.  The last era of severe inflation was in the 1970s, when prices and wages spiraled upward.  This time, while the official inflation rate is still relatively moderate, wages are stagnating and prices for essentials like food and fuel are rising.

    Ashwarya and Alok Sharma and their two children emigrated to the United States from India 10 years ago.  They are now U.S. citizens.  Like most Americans, they are feeling the financial pinch from inflation.  Consumer prices overall are rising at a 2.7 percent annual rate, while average hourly wages increased by just fraction of one percent.

    Alok Sharma says something has to give. “It is hitting both ways because you don’t get well paying jobs, and you don’t get a raise.  And then inflation hits you on the other side," she said.

    Economists say energy and food costs are driving inflation, and Americans are looking for answers.  The Sharmas live in a suburban neighborhood north of Washington D.C.  They work in the computer field and commute 65 kilometers round trip each day to work.  Gasoline prices have risen about 26 cents per liter during the past year.

    Alok Sharma says that is taking a big bite out of his family's budget.  “Our gas bill has gone up 40, 50 percent," he said.

    The Sharmas are vegetarians.  They eat a lot of fresh vegetables.  And they drink a lot of milk, which Ashwarya Sharma says has doubled in price. “Like almost a year back it was $2 a gallon [i.e., about 53 cents per liter].  Now it is $4 a gallon [about $1.06 per liter]," she said.

    They estimate that their food costs have risen 25 to 30 percent during the past six months.  Alok Sharma says that if prices continue to increase, his family will have to cut back and consider lifestyle changes. “Still we are in the habit of getting whatever we want, what ever children demand.  Gradually I think we have to make our choices only for cheaper items," said Sharma.

    Some say the expanding middle classes in countries like China, Brazil, and India are consuming more resources and driving up prices worldwide.  Other experts say drought in places like Russia, turmoil in the Middle East and a global lack of refinery capacity have driven up food and oil prices.

    Economist Danny Leipziger of The George Washington University School of Business says these factors play a role. “I don’t think the middle class in China is going to create rampant global inflation.  But you do have certain markets that are more susceptible.  And you are seeing prices increase in those markets.  Will that lead to a global resurgence of inflation?   Probably not," he said.

    Leipziger says oil prices will likely rise in the long-term because it is a finite resource.  

    For now, he says, families in the United States will have to deal with price increases.  Because the U.S. economy is climbing out of a deep recession, Leipziger says raising interest rates, a common tool for controlling inflation, could make things worse. “The middle class is taking a big hit.  And we wouldn’t want to see policy makers overreact to inflation at the cost of stalling the recovery in the U.S.  That would be bad policy," he said.

    Alok Sharma says his family might need to dip into savings to make ends meet, take fewer trips to visit family in India, and look into organizing a car pool to commute to work.  Hopefully, he says, in a few years, his family's wages will increase and offer some relief.

    You May Like

    New EU Asylum Rules Could Boost Rightists

    New regulations will seek to correct EU failures in dealing with migrant crisis, most notably inability to get member states to absorb a total of 160,000 refugees

    More Political Turmoil Likely in Iraq as Iran Waits in the Wings

    Analysts warn that Tehran, even though it may not be engineering the Sadrist protests in Baghdad, is seeking to leverage its influence on its neighbor

    Forced Anal Testing Case to Appear Before Kenya Court

    Men challenge use of anal examinations to ‘prove homosexuality’; practice accomplishes nothing except to humiliate those subjected to them, according to Human Rights Watch

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Tensions Rising Ahead of South China Sea Rulingi
    X
    May 03, 2016 5:16 PM
    As the Philippines awaits an international arbitration ruling on a challenge to China's claims to nearly all of the South China Sea, it is already becoming clear that regardless of which way the decision goes, the dispute is intensifying. VOA’s Bill Ide has more from Beijing.
    Video

    Video Tensions Rising Ahead of South China Sea Ruling

    As the Philippines awaits an international arbitration ruling on a challenge to China's claims to nearly all of the South China Sea, it is already becoming clear that regardless of which way the decision goes, the dispute is intensifying. VOA’s Bill Ide has more from Beijing.
    Video

    Video Painting Captures President Lincoln Assassination Aftermath

    A newly restored painting captures the moments following President Abraham Lincoln’s assassination in 1865. It was recently unveiled at Ford’s Theatre in Washington, where America’s 16th president was shot. It is the only known painting by an eyewitness that captures the horror of that fateful night. VOA’s Julie Taboh tells us more about the painting and what it took to restore it to its original condition.
    Video

    Video Elephant Summit Results in $5M in Pledges, Presidential Support

    Attended and supported by three African presidents, a three-day anti-poaching summit has concluded in Kenya, resulting in $5 million in pledges and a united message to the world that elephants are worth more alive than dead. The summit culminated at the Nairobi National Park with the largest ivory burn in history. VOA’s Jill Craig attended the summit and has this report about the outcomes.
    Video

    Video Displaced By War, Syrian Artist Finds Inspiration Abroad

    Saudi-born Syrian painter Mohammad Zaza is among the millions who fled their home for an uncertain future after Syria's civil war broke out. Since fleeing Syria, Zaza has lived in Lebanon, Egypt, Jordan and now Turkey where his latest exhibition, “Earth is Blue like an Orange,” opened in Istanbul. He spoke with VOA about how being displaced by the Syrian civil war has affected the country's artists.
    Video

    Video Ethiopia’s Drought Takes Toll on Children

    Ethiopia is dealing with its worst drought in decades, thanks to El Nino weather patterns. An estimated 10 million people urgently need food aid. Six million of them are children, whose development may be compromised without sufficient help, Marthe van der Wolf reports for VOA from the Metahara district.
    Video

    Video Little Havana - a Slice of Cuban Culture in Florida

    Hispanic culture permeates everything in Miami’s Little Havana area: elderly men playing dominoes as they discuss politics, cigar rollers deep at work, or Cuban exiles talking with presidential candidates at a Cuban coffee window. With the recent rapprochement between Cuba and United States, one can only expect stronger ties between South Florida and Cuba.
    Video

    Video California Republicans Weigh Presidential Choices Amid Protests

    Republican presidential candidates have been wooing local party leaders in California, a state that could be decisive in selecting the party's nominee for U.S. president. VOA's Mike O’Sullivan reports delegates to the California party convention have been evaluating choices, while front-runner Donald Trump drew hundreds of raucous protesters Friday.
    Video

    Video Kurdish Football Team Helps War-Torn City Cope

    With the conflict still raging across much of Turkey’s predominantly Kurdish southeast, between the rebel PKK and the Turkish state, many Kurds are trying to escape the turmoil by focusing on the success of their football team Amedspor in Diyarbakir. The club is increasingly becoming a symbol for Kurds, not only in Diyarbakir but beyond. Dorian Jones reports from southeast Turkey.
    Video

    Video ‘The Lights of Africa’ - Through the Eyes of 54 Artists

    An exhibition bringing together the work of 54 African artists, one from each country, is touring the continent after debuting at COP21 in Paris. Called "Lumières d'Afrique," the show centers on access to electricity and, more figuratively, ideas that enlighten. Emilie Iob reports from Abidjan, the exhibition's first stop.
    Video

    Video Florida’s Weeki Wachee ‘Mermaids’ Make a Splash

    Since 1947, ‘mermaids’ have fascinated tourists at central Florida’s Weeki Wachee Springs State Park with their fluid movements and synchronized ballet. Performing underwater has its challenges, including cold temperatures and a steady current, as VOA’s Lin Yang and Joseph Mok report.
    Video

    Video Somali, African Union Forces Face Resurgent Al-Shabab

    The Islamic State terror group claimed its first attack in Somalia earlier this week, though the claim has not been verified by forces on the ground. Meanwhile, al-Shabab militants have stepped up their attacks as Somalia prepares for elections later this year. Henry Ridgwell reports there are growing frustrations among Somalia’s Western backers over the country’s slow progress in forming its own armed forces to establish security after 25 years of chaos.
    Video

    Video Nigerians Feel Bite of Buhari Economic Policy

    Despite the global drop in the price of oil, Nigerian President Muhammadu Buhari has refused to allow the country's currency to devalue, leading to a shortage of foreign exchange. Chris Stein reports from Lagos businessmen and consumers are feeling the impact as the country deals with a severe fuel shortage.

    Special Report

    Adrift The Invisible African Diaspora