How to Respond to Price Increases
As predicted by economic experts, consumer prices rose 6.2 percent in October compared to last year.
Those increases are real, and felt most deeply by those who can least afford them. But as Roosevelt Deputy Director of Macroeconomic Analysis Lauren Melodia explains, addressing today’s price changes requires that we understand what’s causing them.
“Pandemic disruptions, long-term underinvestment in our economy & rises in volatile sectors like energy are all clear drivers of increases,” she writes. “Luckily, all have solutions.”
Instead of reining in federal spending, policymakers should be pursuing targeted policy reforms that could prevent the kinds of challenges we’re now facing—by investing in supply chains, raising wages, and addressing market concentration.
The bottom line? Scaling back the recovery doesn’t solve the real hardships people are experiencing. We must ensure our economy rebounds quickly and equitably, and make the long-term investments necessary to make people’s needs more affordable.
Learn more in "Rethinking Inflation Policy: A Toolkit for Economic Recovery."
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