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Revolt against $4 tomatoes

Full Speed to Port!

Posted: May 28, 2008 3:21 p.m.
Updated: July 29, 2008 5:02 a.m.
Mother's Day. Rushing through Pavilions, gathering groceries for our barbecue just one hour before folks hit the front door. Today's menu: burgers and dogs, baked beans, chips and salsa. And we plan to do the burgers up right, what with big beefsteak tomato slices, white onions, crisp lettuce, American cheese - the works.

I'm cruising the vegetable section for the tomatoes. They're proudly displayed at the end of one aisle, and my head reels back with whiplash from sticker shock. The sign says "Tomatoes: $3.99 per pound."

Four bucks for tomatoes? You're kidding, right? Tomatoes are likely the most common vegetable on the planet.

While these tomatoes were the nice, big ones I desired, I headed down the aisles searching for more affordable fare. We'd have to suffer smaller slices rather than exalt in the full bun-width-size jobs. But nothing doing at the Pavilions. On Mother's Day, if you wanted a reasonable tomato, it was four bucks - or serve naked burgers.

I needed those plump red suckers, so I weighed one on the scale. That fat dude tipped the pointer like a heavy weight. Fifteen ounces. It was indeed a plumper - and its price was dear. My limited choice came down to this: With guests arriving in an hour, I needed three darn tomatoes here and now, and I was held hostage for three tomatoes at 12 bucks.

I held the precious ruby orb up in my right hand and considered our state - one tomato or a gallon of gas. At today's prices, we're being faced with hard choices.

It seems like everything's doubling in price, right before our eyes. Yet despite what we're experiencing on the ground, the U.S. government consistently reports low inflation rates. Just last month it had inflation pegged at 2 percent.

Do you buy this tripe? The pain in your wallet and your bulging credit card bill tell you we're being fed federal inflation fantasies.

Harpers published a detailed article on how and why the Fed manipulates inflation reporting over the years. Administrations of all stripes alter formulae and data to "keep the lid on." For two decades we've been told inflation is low and under control.

But our real experience tells us different. Cars, gas, food, rent, health care, clothes - everything except imported electronic gadgets seems to be rising fast. And important staples like fuel, food and health care seem to be leading the pack.

Governments in deficit have strong incentive to report low inflation rates. In truth, reporting actual rates might bankrupt the United States nearly overnight.

First, government bonds are keyed to inflation rates. They typically sell at inflation, plus a point or so. So 10-year T-bills currently go at 3.9 percent. That's cheap money for financing deficits. But if inflation were published at real world rates, the United States might be borrowing at 8 percent to 12 percent. Budget busting, indeed.

Inflation also impacts Social Security payments. Social Security issues cost-of-living adjustments based on reported inflation rates. At 3 percent, these increases are modest. But does anyone think Social Security cost-of-living increases actually cover increased living expenses? Hardly. If Social Security increases truly covered inflation, the system would already be broke.

So the Fed routinely adjusts its "cost of living basket of goods" and formulae to cast things in the most positive light. Responding to April's report, a senior Wells Fargo economist scoffed, "The data released by the Labor Department weren't worth the paper they were printed on." And my four-buck tomatoes back this guy up.

So what's in store for America? Likely some day we will face a day of reckoning with high inflation and severely devalued dollars. So we need to save more, adjust more and revolt against whatever price inflation we're able to control. It starts with changing our habits and expanding our choices.

Commodity industries exploit consumers' lack of alternatives. Do you suspect that gas and grocery companies are innocently passing along their own rising costs? No way! They're purposefully exploiting us.

This just in: Safeway (Vons' and Pavilions' parent company), rather than sagging under high costs, reported an incredibly fat 11 percent increase in profits. And you already know how obscene oil company profits are.

These companies raise prices not because they must, but because they can. For-profit companies exist to earn as much as they can, regardless of "fairness."

With food and fuel, our relative lack of alternatives is license for firms to raise prices. With poor mass transit and scarce alternate fuels, we're robbed at the pump. With giants like Safeway and Kroeger having bought up local competitors, decreasing local choice, they now use that advantage to raise prices and increase profits. Fewer choices mean higher prices.

We worship Wild West Capitalism, and we've unintentionally made ourselves hostages to our own god. Now the only way to reign in this evil is to consume less and shift to whatever alternatives that exist. For gas, we can carpool. We can walk. We can ditch the Hummer and go with the econobox. Lowering fuel consumption will make a big difference as tanker ships back up in ports with nowhere to unload their bursting bellies.

And for overpriced groceries? If you're not facing a party deadline in one hour, tell the majors to pack their own bags and you can shop at alternate venues.

After the great Pavilions tomato robbery, I visited our Vallarta market over on Lyons to compare. Vallarta is independent from the major chains. There, big tomatoes were $1.29 a pound Cucumbers were a great deal at four for a dollar! Produce seemed about half the price of the Pavilions across the board. And most labels indicated the stuff was grown in the United States.

Trader Joe somehow sells eggs at just $1.50 a dozen. Independent Joe makes plenty of profit selling tasty essentials for much less than Kroeger and Safeway.

So happily, we still have options to help control price inflation. Foremost, don't believe your government. They're lying to cover their bloated butts. Save and invest wherever you can. Second, stage your own revolution against corporate price abuse. Just say "NO" to high gas. Change habits to consume less. And avoid monopoly stores that price gouge, and instead buy at venues that supply good value to earn your business.

Competition is the great equalizer in our economy. It's the ultimate inflation beater. Let's revolt against gouging companies and use our free choice to beat their prices back into reason.

Gary Horton lives in Valencia. His column reflects his own views, not necessarily those of The Signal. Full Speed to Port runs Wednesdays in The Signal.


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