By Marie Cocco
The one certainty I have about the economy is that I did not cause Target’s profits to slide. Quite the opposite. I’ve been dedicating time for trips to the discount retailer to save a few bucks that would otherwise have been spent thoughtlessly buying, say, paper towels at the grocery store, where you never know if they’ll be on sale.
But it turns out that consumers more pinched than I am are switching to Wal-Mart, so that discounter has been posting sales increases while Target is slumping. With wholesale inflation for July just reported at a 27-year high, at least some of this summer’s painful energy costs are expected to be factored into consumer prices in the coming months, so we probably haven’t seen the worst of inflation.
Even Saks, the luxury department store, is suffering a slide in sales and profits. The economic pain is trickling up, a perversely welcome change from the immunity the Saks class has enjoyed for too many years to count.
This week’s bad news is almost sure to be followed by more next week, when the Census Bureau reports on 2007 trends in income, poverty and the number of Americans without health insurance. The consistently alarming number regarding those without insurance is likely to climb again. Employers were dumping insurance coverage to pare costs even before they started dumping significant numbers of jobs altogether. And since insurance coverage is usually tied to jobs, the logic is inescapable. “I expect a significant increase in the number of the uninsured,” says Jared Bernstein, a senior economist at the Economic Policy Institute.
The surge in inflation comes after years during which wages had been mostly flat, another trend likely to be confirmed by the census report. The economic expansion that began after the 2001 recession could be the first on record in which real median family income actually will be lower at the end of the “recovery” than it was at the last business peak (in this case the year 2000), Bernstein believes.
It is no overstatement to call this a crisis. The thoroughly disheartening twist is that it seems not to have sparked a political uprising, even in the midst of a presidential campaign.
With economic conditions about as bad as they’ve been since the early 1980s, the most pressing political stories of the past week have been entirely—and exhaustively—beside the point. One involved whether Republican John McCain or Democrat Barack Obama was more effective in groveling before the famous pastor of an evangelical Christian megachurch.
When the two candidates were not maneuvering their way through the religious thicket, they were calibrating their strategies for announcing their choices for vice president. Never mind that there’s precious little historical evidence that this choice matters very much in an election’s outcome. The way the candidates stage-manage the selection is now supposedly the significant and revealing event.
You are left to wonder what any of this has to do with the price of milk, which, like the price of most other food, has gotten completely out of hand. I have never been one to hold politicians accountable for not knowing the answer to those silly questions such as how much a gallon of milk or a loaf of bread costs. This particular game of gotcha is unfair to politicians running for president, because they really do live in a cocoon imposed partly by contemporary security needs and partly by their fear of giving a thoroughly embarrassing answer.
Still, the price of milk—rather, the broader, complicated, awful economic circumstances we confront that have helped lead to the mind-boggling price of milk—should be the most talked-about political issue right now.
Yet other than the drill-or-not-to-drill-for-offshore-oil debate, no economic issue has made it into the core campaign message of either candidate.
You can’t blame McCain. He is closely tied to the Bush administration’s failures on the economy and even flip-flopped to say he would continue the exorbitant tax breaks for the rich that he first wisely opposed. But where is the outrage from Obama? It has turned up, finally, in television ads that, in part, use McCain’s own statements on the economy to depict the Arizona senator as clueless.
Amid this blur, I long for a candidate who would “focus like a laser beam” on the economy. That’s what voters are doing as they see their paychecks shrink from inflation, their jobs threatened and their middle-class dreams diminished.
Marie Cocco’s e-mail address is mariecocco(at)washpost.com.
(c) 2008, Washington Post Writers Group