Inflation and the rise in prices that has broken us, from spending to gas

Peter Lewis acknowledges that eggs aren’t the biggest expense in the world. But amid today’s inflation levels, rising consumer staple prices really hit him. “I tend to buy the same things every week, and for some reason, with eggs, I only eat a lot and notice the prices on them,” he says. The 18 extra-large eggs he buys were $ 3.18 in early 2021; now cost $ 5.12. Over the weekend, Lewis spent nearly $ 100 at the local Walmart on food for him and his wife, a figure he doesn’t believe he’s ever hit before. “It’s not like we’re buying an entire shopping cart.”

Inflation is bad. For consumers, it’s painful in ways big and small. Peoples’ wages are not keeping pace with rising prices, which means that some have to make major cuts to stay afloat. Beyond the economic difficulties imposed by inflation, there is also a real psychological toll. People pay more attention to prices than ever before and notice increases on items they are most familiar with, increases that may not be the biggest, but are still annoying.

“Rising prices hurt because we don’t value the price of eggs in absolute terms, we value it by how much we paid for them,” says Deborah Small, a professor of behavioral marketing at the Yale School of Management. “A price increase is like a loss and we feel pain when we experience that loss.”

With the way inflation has been going lately, that feeling of loss abounds.

At today’s inflation levels, pretty much everyone has looked at the price of something and thought, “Wait a minute, what?” For some people, it’s about large items like homes and cars. For others, it’s about little ticket stuff that still leaves them surprised, wondering why a packet of paper napkins costs $ 5 more than a few months ago, or if that bag of chips was a little bigger for the same price. We often notice more changes when it comes to things we habitually buy. And of course, all those small price increases add up.

Lewis, 71, and his wife are doing well: they are now retired, have had good corporate jobs all their lives, have saved a lot, and have outgrown some bull markets. But he can’t help but worry about others. “I look at Walmart, I see families shopping there, and I know the extra $ 50 a week is a killer for those people,” he says.


Inflation is a common topic now, virtually anytime, anywhere. In early August, my Vox colleagues and I talked about where inflation had occurred in people’s lives and what had simply broken them. Since this is the year 2022 and I work in online media, I asked this question on Twitter. There has been a variety of responses, but overwhelmingly, the most common place people hit a breaking point with inflation was at the grocery store.

Hila Paldi, who owns a Pilates studio in New York, told me she hit her wall with bacon, a key ingredient in her son’s beloved homemade bacon, egg and cheese sandwiches. The package she got used to cost $ 8.99 at the local supermarket and when she went to buy it recently it was $ 12.99. “I went to the manager and said, ‘Is this right or is it a mistake?’ And they’re like, ‘Yeah, that’s the price now,’ “she says. So she didn’t buy it.” Honestly, this is something we can do without. “

Drew Ober, an engineer from Indianapolis, told me that the thing that impressed him the most was the frozen chicken tenders. He likes to have them on hand at home because they’re an easy-to-work lunch from home or a lazy dinner. “I hesitate almost every time now,” he says. He pulled out some old grocery receipts to make sure he was right, telling me he bought a 48-ounce bag of chicken tenders in April 2021 for $ 8.79. Now, it’s listed as $ 11.99. Most of the time he still gets them, even if he feels even less guilty about going to the restaurant to get them instead. “I don’t seem to save much to buy groceries anymore.”

It’s not just the rising prices in the store that annoys consumers, but also the falling sizes, as happened to Tony Sarthou, father of two starving teenagers in New Jersey. “Doritos and Oreo, for better or for worse, are fundamental elements in our cuisine,” he says. But lately, he has noticed that the package is getting smaller, a phenomenon called shrinkage, where companies give you less for the same amount of money. On multiple occasions, Sarthou says he and his wife walked down the aisle of the grocery store, looked at the prices and sizes of packages, and walked away. “The size is getting smaller, the price is the same or more often than not, higher.” They are starting to replace generic or private label brands.

Many people wonder if the price increase – or package reduction – was really necessary. Wasn’t there some sort of reward for being loyal to a local grocery store? Sure, there were supply problems for chicken competitions due to labor shortages and bird flu, but was that really the case? How much did the producers of Oreos, owned by the American food conglomerate Mondelez, save by giving you a little less biscuits?

“I really don’t see how this is getting to us, I don’t see where it makes sense,” says Dorothy, a New York teacher and mother of two, who asked to hide her last name to protect her privacy. Her family has special dietary needs – she has severe food allergies, her husband is vegetarian – which force them to make some “tough decisions”. With organic strawberries for $ 7.99, the answer is “Are you kidding me?” Half a gallon of ice cream for $ 4.79 is a “Devil no” and pasta for $ 2.49 a box “just won’t happen.” She writes a list before going to the store and if the item is not on the list, it is not bought. “We’re not going on vacation, the housework has been interrupted,” she says of how her family is adjusting. “Sounds scandalous.”


As Julia Carpenter noted in the Wall Street Journal, people understand price tags through the articles that make up their daily budget. They use a handful of mental benchmarks to measure their inflation expectations. David Wessel, director of the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution, told WSJ staff that they take these benchmarks and then “totally extrapolate it to the economy at large.”

Beyond everyday objects, having inflation in the brain is likely to cause people to think about prices more than they normally would, explains Utpal Dholakia, a marketing professor at Rice University’s business school. “Consumer knowledge of prices is generally very poor. In general, under normal conditions, most of us don’t know the prices of most of the normal things we buy, ”he says. “What inflation did is that, as a general rule, people pay more attention.”

And, in turn, people feel more annoyed. Especially since the total amount of everything goes up.

Dholakia advises companies on pricing strategy and notes that just because consumers express anger at prices doesn’t mean they always change their behavior. There is a “huge gap” between what people say and what they do. “They will complain,” she says, “but they will still pay the highest price.”

This was the case with Andrea from Missouri, who also asked for anonymity. Earlier this year, she paid nearly $ 25 for a single box of ob tampons on Amazon (they typically cost less than $ 10). Amidst the shortage of tampons, she couldn’t find them at Target or Walmart and she didn’t want to switch brands. She says she thought, “Well, Amazon is technically a black market, maybe you can find them there.” Andrea acknowledged that she had been exploited by the seller and that her price was “ridiculous”, but she still clicked to buy. “I know people have to do what they have to do to survive, and I’m not very mad at that person,” she says of the Amazon tampon. “I wanted them desperately.”

He can now find his tampons for a more reasonable price, but they are even more expensive than before, as is everything. Andrea, who works in data analysis, has seen an increase in the past two years, but inflation has made it essentially obsolete. “How do I get to the 75th percentile of income in the county and yet I’m struggling and can’t save money?” she says. “I’m still broke.” She is divorced and being single is expensive. She jokes that she might find another husband, but she doesn’t really want to: she likes to be alone. “When you’re in your 40s, if there are men out there, you probably don’t want them.”

Over the past few days, I’ve talked to many people about specific places and times in their lives when they really felt at a breaking point due to inflation.

For Vanessa Santos, who had not one but two Covid children, it was trying to buy new professional outfits to get back to business meetings. “She made me start resuming my workout routine after the baby so I could adjust to my old clothes,” she says. For Kail Zepeda, a father of four in New Jersey, his moment of shock came when car dealers asked him to pay $ 11,000 more than the sticker price for a new car, a phenomenon in which many buyers on the market are meeting. “He’s crazy right now,” he says.

I’ve heard of asparagus, butter and donuts, vacations, rental apartments and beer. “$ 19 for a 12-pack of Coors … come on,” one person commented on Twitter. “I was buying what I thought was half a dozen bagels, I realized in the checkout aisle that there were only 5 in the bag and I almost lost it,” wrote another.

Ober, the Indianapolis engineer, says gasoline prices come to him too, but in a different way. Where he lives, there are really no great substitutes for owning a car and driving yourself to places. “I feel more helpless,” he says. “You can somehow reduce where you’re going, but I mean, it’s harder to do.”

Existing as a consumer in the current economy is really bad. It is as if we are all constantly stung by a thousand tiny needles, which prick everyone; every now and then, one really hits a nerve.

There will be an end at some point, but that will probably hurt too. American consumers, especially younger ones, are not used to inflation and many are not used to having to make sacrifices or be so careful with their purchases. The whole situation isn’t quite ideal.

As for Lewis, this isn’t his first inflation rodeo. He remembers what it was like to see prices rise in the 1970s, the last time inflation was a big deal in the United States, as a young professional living in Manhattan. “I just thought it would go on forever,” he says. This was not the case: the end of the inflation issue in the country was ultimately brought to an energetic and painful end.

Given those memories, he worries about what lies ahead. “I understand what it takes to stop him, and it’s not a good picture,” he says. He remembers that his friends lost their jobs when the country fell into a recession and the endless paranoia that he might be next. He also remembers that while the acceleration of inflation has stopped, most prices have not even returned to the downside. “He just stayed,” says Lewis, who now lives in Florida. “For most things, if they fall, it will be minor.”

In other words, the breaking point you hit with inflation won’t break anytime soon.

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