Who eats the cost of higher food prices?

The Indicator from Planet Money

NPR

Business

4.7 • 9.2K Ratings

🗓️ 12 April 2022

⏱️ 9 minutes

🔗️ Recording | iTunes | RSS

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Summary

Low-income households spend a disproportionate amount of their income on food and as inflation continues to spike, especially when it comes to food prices, these families are particularly vulnerable. However, research looking at how the Bureau of Labor Statistics calculates the consumer price index, indicates the CPI may be failing to show the extent of that harm. Today, why the CPI may be underestimating higher prices in the supermarket for low-income Americans.

Transcript

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0:00.0	NPR.
0:07.0	Imagine you're standing at a grocery store and you walk to the produce section to get
0:16.0	some oranges and you find one bin labeled organic oranges and the other is regular.
0:23.7	So what do you choose?
0:25.9	Maybe you prefer organic because it sounds healthier or you want non-organic because
0:30.3	it's cheaper.
0:31.3	Maybe you don't care and you just want whatever is going to be tasty.
0:34.4	Now this may seem like a trivial decision, but this decision has consequences beyond
0:39.4	just how you're going to get your daily vitamin C. The one you choose could determine
0:44.2	just how much you are affected by inflation.
0:48.3	The monthly consumer price index numbers are out and according to government statisticians,
0:53.2	the hypothetical basket of goods and services that makes up the CPI has increased.
0:59.0	And let's just take a deep breath because the CPI last month was 8.5% higher than a year
1:09.0	ago.
1:10.0	Wow.
1:11.0	That is the biggest year over year increase in about four decades and it's driven by
1:15.3	climbing prices of all kinds of things, gas, clothing, even oranges.
1:20.8	And as high as that is, the burden of inflation for a lot of people may actually be worse than
1:26.7	the numbers suggest.
1:28.9	This is the indicator from Planned of Money.
1:30.2	I'm Adrian Ma.
1:31.2	And I'm Whalen Wong.
	...

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