EJ Antoni
If you’ve had to change your buying habits at the supermarket lately to save money, you’re not alone. The stratospheric rise in food prices in the last three years has forced many families to forgo groceries they used to enjoy in exchange for cheaper alternatives.
This change in consumer behavior is emblematic of the painful decisions American families must make in the Biden-Harris economy. Disturbingly, nationwide data is even showing the resurgence of an economic phenomenon made infamous in the 19th-century Irish potato famine.
When a blight decimated the potato crop in Ireland, the supply of potatoes dwindled, and their prices rose dramatically. Normally, higher prices cause consumers to demand less of a product or service, but not this time.
Instead, demand for meat and other foodstuffs collapsed, and consumers tried to buy more potatoes. The blight reduced the supply of potatoes available, so the Irish were able to buy fewer of them—and tragically, many people starved.
But why did the Irish want more potatoes and less meat at precisely the time the former became much more expensive? The answer lies less in the rapid rise of food prices and more in the relative prices between those foods.
Let’s say an Irish family previously bought 4 pounds of potatoes for $1 a pound each and 1 pound of meat for $2, spending $6 in total. If potatoes jump to $2 a pound and meat increases to $2.10 a pound, then the family must spend $10 for the same weight of food, except now it’s all potatoes. They’re spending two-thirds more and getting a lower-quality meal.
Even if all food prices were rising in Ireland, potatoes remained the cheapest food available, so demand for them skyrocketed. Disturbingly, the United States is now seeing a similar shift in consumer food purchases.
Recent survey data published by the Federal Reserve Bank of Dallas show food manufacturers have seen a significant increase in consumer demand for sausage—even though the price of sausage has risen substantially—while demand for more expensive protein, » Read More
https://www.heritage.org/budget-and-spending/commentary/potato-famine-economics-courtesy-biden-harris