A deadly epidemic has struck birds across the Midwest and, while it’s no COVID-19, the consequences are far-reaching.
Avian influenza, often called bird flu, is spreading from migratory waterfowl to other wild birds and on to poultry farms. While the disease is believed to pose no threat to human health, this life-and-death matter for birds is hitting people where they can least afford it at a time of high inflation.
The price of chicken and eggs is soaring as producers try to stop the spread by destroying infected flocks numbering in the millions. The outbreak could get worse before it gets better, putting pressure on grocery store shoppers who are fast running out of options for affordable animal protein.
Between the supermarket and the gas pump, there’s nowhere to hide from high prices these days. People want someone to blame, and incumbent politicians will be in trouble if this year’s midterms become a referendum on the price of wings and drumsticks.
Elected officials trying to soothe ruffled feathers among voters are coming up short. Actions aimed at restoring approval ratings generally create new economic and political problems, as in the case of temporarily waiving gas taxes. Pouring on government money also is no solution. The trillions already spent on pandemic relief has surely contributed to today’s rising prices.
The reality is that some factors underlying inflation can sort themselves out quickly, while others are going to take a frustratingly longer time. Fortunately for backyard barbecues and breakfasts, the price of commodities like chicken and eggs can move down again in short order.
To accurately measure inflation, it’s useful to take out food and energy prices because their volatility can mask price changes with more staying power. The U.S. Federal Reserve attributed much of the country’s inflation last year to factors that would not last long. The Fed’s experts were right about some inflation being “transitory.” But they greatly underestimated the outlook for “core inflation,” which is the level of price increases minus the wild cards of food and energy.
Core inflation measures the broad range of stuff that goes up and stays up, leading people to expect higher prices in the future, which in turn encourages them to spend now to avoid paying more later. That behavior is understandable, but it can propel inflation, and the negative psychology can become so persistent as to define an entire decade.
The U.S. learned lessons from the mistakes of the 1970s. No. 1: Do not let inflation fester, as it only gets worse. We expect the Fed to raise interest rates aggressively in the coming year, and decrease its bond holdings, accepting short-term pain to avoid longer-lasting malaise. It’s a necessary trade-off.
While policymakers are well-equipped to fight inflation, that’s cold comfort for the birds and those who care about them. Even in the heavily subsidized world of agriculture, government protection isn’t usually enough to make producers whole when they’re forced to destroy commercial flocks.
No chance of mask mandates for beaks, of course. But if they would help, we’d support them. There have been more than enough inflationary disruptions to the chiller case at the supermarket.
