Bare Necessities (electricity issue)

Post #897

When society operates under free market mechanics, prices don’t go up. As an example, look at the electricity prices up to 1970 or so:

The price in 1973 was still below the price of 1919, a full 54 years prior. If prices do not rise in 54 years, then you have evidence that you are operating under free market mechanics. With a caveat that the Consumer Price Index (CPI) is not a perfect measure of price change, workers could afford a lot of electricity with their wages:

If the CPI was a perfect measure of price change, then workers in 1968 could afford to buy 8 times the electricity of workers back in 1934. Here is a longer time series showing how the affordability of electricity stopped rising for blue collar workers:

[Q1 of 1942 ~ 1.00; with 4 times the purchasing power by 1969]

But as this last graph shows, elites are successfully making electricity cost more — due to the fact that not enough people have demanded a return to free markets. By allowing government to make more rules and spend more money, we condemn ourselves to lower living standards: the price of bare necessities rise.

Reference

U.S. Bureau of Labor Statistics, Consumer Price Index for All Urban Consumers: Electricity in U.S. City Average [CUUR0000SEHF01], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/CUUR0000SEHF01

National Bureau of Economic Research, Average Weekly Earnings, Manufacturing, Total for United States [M08261USM052NNBR], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/M08261USM052NNBR

U.S. Bureau of Labor Statistics, Average Weekly Earnings of Production and Nonsupervisory Employees, Manufacturing [CES3000000030], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/CES3000000030