Economic Outlook: The High Cost of Consumer Goods

The U.S. economy as of December 1977, the world economy stalls while the U.S. grapples with the high cost of consumer goods.

| November/December 1977

  • The U.S. economy and the high cost of consumer goods.
    The U.S. economy and the high cost of consumer goods.
    Photo By Fotolia/durango2010

  • The U.S. economy and the high cost of consumer goods.

MOTHER's analysis of the U.S. economy as of December 1977 includes information on the high cost of consumer goods.

This column first appeared back in MOTHER NO. 34 (July-August 1975). And the feature was started because a lot of little people (you and me, for instance) had been and were still being hurt.

Hurt by addled politicians and Keynesian economists who placidly told us that all was well . . . while we squandered our national wealth on a futile war . . . while we watched the high cost of consumer goods nearly double and the value of our dollars shrink almost by half . . . while we plunged into the biggest financial depression since the 30's . . . while taxes were piled on us until our knees buckled . . . while the gold backing was officially removed from the last of the world's major currencies, leaving the value of everyone's money resting only on the slim foundation of political expediency . . . while the planet's supplies of fuel and food and other raw materials were turned completely up-side down . . . while the stock market plunged, climbed, and then plunged again . . . while . . . but then, of course, you know what we've all been through.

Nor were the economic storms we passed through during the past 10 years the last ones we're likely to see before we sail into clear weather once again. Far from it.

Western Europe's economic recovery has stalled. As has Japan's. As has Canada's. As ours will shortly (according to most leading indicators, the very few rational and honest economists among us, plain ole common sense, and the most rudimentary and provable facts about the life spans of business cycles).

The world's less industrialized "free" nations, of course, are in even worse straits. Straits so bad, in fact, that most of them would be thankful if they had just an economic recovery to stall. But they don't. Instead, they're largely in one stage or another of a permanent, ever-deepening, and perhaps fatal financial depression. They already owe the banks of the developed countries 190 billion dollars that they have virtually no way of (and, in some cases, no real interest in) repaying. Furthermore, their birthrates are almost universally so high that merely to maintain their generally wretched current standards of living-they must switch their import/export balance of payments from massive deficits to massive credits and at least double their real gross national products during the next 25 or so years. And — thanks to the escalating prices they're now paying for food, fuel, and manufactured goods combined with the plunging prices that they receive for their raw materials and commodities — there is flatly and absolutely no way that can be done.

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