11/11/2024
TWO EGGS OVER AFFORDABILITY - Repost from my friend FRANCINE HARDAWAY One of the biggest issues in the recent election has been inflation, which has been symbolized by rising grocery prices. Especially egg prices.
Who did we blame? President Biden? Really?
Just for fun I looked up the price of eggs this morning, because everyone who has been accusing the United States of still having inflation cites eggs as an example.
As if the president, or the vice president for that matter, has a damn thing to say about the price of eggs. But candidates are accused of being out of touch if they can’t tell us how much a dozen eggs cost, so let’s go down this rabbit hole.
The price of eggs at my neighborhood Sprouts, an organic supermarket without particularly cheap prices is $3.99 to $6.99 depending on whether you want organic or cage free eggs. In Walmart? $2.58. That doesn’t seem like so much, especially since consumers are now demanding that the chickens be raised humanely. No more Temple Grandin conditions in which they’re grown on batteries and pumped full of antibiotics.
Those prices lead the people who are in charge of data, the economists, et al., to insist that inflation is gone. It may have been eight or 9% two years ago, but now it is down to two or 3%, which is considered normal. (I don’t know why any amount of inflation is considered normal, but it is.) What’s more, the people who complain about inflation do not believe the data scientists who tell us that inflation has come down. They still cite egg prices as one indicator.
How can this be?
My son Jerry works for Hickman‘s Egg Ranch, running a machine that separates and grades the eggs and sorts them. He’s like an egg engineer. He would never in a million years blame presidential candidates for the price of eggs, because he knows too much about where they come from. Many people can affect the price of eggs, but one of them is not the president.
Actually, consumers have a big input into the price of eggs. Like many other states, Arizona drafted a law requiring all eggs to be cage free by 2025. That law came from a ballot initiative passed by voters.
Hickman‘s buys baby chicks and brings them up in barns. Different barns have different conditions for raising the chicks, and Hickman’s is gradually moving toward the cage free standard for all of its chickens, because of consumer demand.
This law, when it passes, will require every egg sold in the state to be cage free. However another consumer, a restaurateur in Tucson, has held up the bill because he felt that as a buyer of eggs he should have input into it.
So while the change is probably inevitable, the holdup gives Hickman’s more time to switch over its barns, because changing out the barns is no joke. Like everything, the move to cage-free eggs comes with a cost. It means depopulating the barns, cleaning them out, and filling them with new chickens under new conditions.
This is a somewhat complicated process, and I have only been asking Jerry about it because I’ve been talking to Karma Club about where our food comes from, how much it costs, and how that influences our health.
In separate conversations I’ve been talking with my political friends about who is to blame for inflation.
Well, it’s probably not Hickman’s Egg Ranch, unless the ranch had hit by avian flu or some other disease that forced them to depopulate barns in an untimely fashion and invest in new chicks.
The farmer is at the mercy of the soil and the elements and the diseases. Further up the line we get to people who have more potential responsibility for causing inflation, right up to the supermarkets.
In the past few decades there have been enough mergers and acquisitions in the supermarket industry that today just four companies—Walmart, Kroger, Costco and Albertsons—account for about half of all grocery sales in the country. These companies have the pricing power because there are so few of them. They are heading toward monopolies.
Sure enough, Kroger and Albertsons recently announced a merger, which drew the ire of the Federal Trade Commission, the agency responsible for enforcing the Clayton and Sherman anti-trust acts.
“On the stand testifying under oath during their Albertsons merger FTC trial, Kroger executives admitted to raising milk and egg retail prices above the rate of cost inflation. They later called the price hikes in question “cherry-picked”. But industry data shows otherwise. Price gouging and price manipulation in the grocery industry have been widespread, driving food prices up over 30% since 2019. Meanwhile, contrary to the claims of economists, demand has stagnated. Leading food companies made more money by selling less food. Kroger’s admission validates criticisms of the merger, but it also opens a pandora’s box: that the Harris-Walz campaign promise to ban price gouging maybe wasn’t so crazy after all.”
There it is: a five-year spike in food prices spanning two administrations. And as near as I can tell, caused by monopolistic practices and corporate greed. Now let’s apologize to presidents Trump and Biden for blaming them.
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