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Are you ready for the most expensive holiday season in forever? Hold on to your wallets, because high inflation and wrongheaded California policies are the Grinch that stole Christmas, pressuring family budgets and diminishing our quality of life.
If you’ve gone to the grocery store or shopping mall, you’ve witnessed a spike in inflation like we haven’t seen in decades. The consumer price index surged 6.2 percent from a year ago in October, the highest increase since 1990. But the story is actually worse. The October monthly increase was itself 0.9 percent, which would indicate an annualized increase of nearly 11 percent.
As famously put by Nobel Prize winning economist Milton Friedman, inflation is always a monetary phenomenon. When the federal government flooded the country with stimulus dollars without accompanying goods and services, inflation was entirely predictable.
What does this mean for the average working family? It means that every item on your holiday dinner table will cost more. Gifts for your children will cost more. Heating your house will cost more. Gas, hotel rooms, movie tickets, clothing, haircuts will all cost more. Inflation robs purchasing power from each and every dollar you make.
Workers may be seeing increased wages, but when they don’t keep up with price increases, people become poorer even as they earn more.
As ugly as the picture is nationally, California is worse. Our state isn’t responsible for the flood of dollars driving inflation, but it’s stacking bad state policies on top of bad federal policies and making it tougher for families to make ends meet.
For example, so called “green energy” policies drive our residential electricity costs more than 50-percent higher than the national average. A California specific gasoline blend, cap-and-trade charges for transportation fuels, and the highest gas taxes in the nation add up to five-dollar gas all over the state. That spells poverty for working families, commuters, rural drivers, and energy intensive businesses.
It’s no surprise that California, a state that’s turned shoplifting into an unpunished hobby, pushes policies that rob families and businesses every time they turn on the heat or fill their tanks.
Inflation is a stealth tax, making every dollar worth less. California residents are punished again by a policy-driven cost of living that strains our citizens to the brink.
Our governments should open their eyes and see the damage they cause to the very people they claim to help. This year, they are leaving a lump of poverty in working-class stockings. I hope for wiser policy in 2022, but that would indeed take a Christmas miracle.
Senator Ted Gaines (Ret.) was elected to represent the Board of Equalization’s First District. He is a leading taxpayer advocate and is committed to providing trustworthy and transparent representation for nearly ten million constituents in 30 counties of northern, eastern, and southern California. For more information, visit www.boe.ca.gov/Gaines.