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| Angelika/Mike Schilli |
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Michael It's certainly not escaped your notice that everything is getting more expensive, and you're probably eager to find out if it's the same in the US as it is in financially-strapped Germany. To that I can say that certain goods have always been absurdly expensive here by international standards (cheese, butter, good bread, wine, beer, ice cream), while clothes or beef are definitely cheaper here.
For the past 20 years, prices have crept up almost imperceptibly year after year, and while a burrito at a Mexican restaurant cost about $6 in 1997, the price of this fast food eventually surpassed the $10 mark by 2015, which is actually a relatively acceptable increase due to unavoidable inflation. Then came Corona and within two years the price suddenly jumped to $16. And if you want beef on it, add another $2 because beef has suddenly become scarce and expensive (Figure #3)!
Looking at a table of official US inflation rates by year, it appears that 2023 had the highest recent rate at 8%, similar to Europe where it was 9.2% in 2023. It also shows that the US had even higher rates in the 80s, around 14%, and that was for several years.
If you, like me, regularly go to the supermarket to buy groceries, you know that the inflation rate is currently far from 8%. It is much higher! One reason for this is that the published numbers are reduced from official sources using interesting methods. For example, if a car used to cost $10,000 and now costs $20,000, it is not assumed that there has been a 100% increase in price. No, the statisticians argue that the car is now much more modern and has smarter functions, so the car is now much more valuable than the old vehicle. The consumer is lucky to be able to buy this progress at a higher price! The inflation calculation is then based on an appropriately adjusted base price, not the previous price. That the consumer might be satisfied with the old function and would rather buy a less sophisticated but cheaper car does not matter. Those interested can read how the government agency "Bureau of Labor Statistics" (BLS) calculates inflation as the "Consumer Price Index" (CPI) and reduces prices with the so-called "Hedonic Quality Adjustment".
Eating out at restaurants has become more expensive for us too, since there are hardly any people willing to work in the low-wage sector right now. You have to pay around 25 dollars for a cheap main course in San Francisco, or more than $40 for something meaty. However, I was shocked to find out during our visit to Germany this summer that German menus have also reached this level! One thing that is still cheaper in Germany is beer. While a "pint" at "Zeitgeist", one of the few beer gardens in San Francisco, now costs 9 dollars (plus 2 dollars tip), hardly any shop in Germany charges more than 6 euros.
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