The price of gasoline reached 5$ per gallon on the 11th of this month in the United States. This is a 14-year high, according to the American Automobile Association (AAA), breaking the previous record set in July of 2008, when the country was also grappling with high inflation figures.
The summer always sees higher gasoline prices because of increased demand, especially around Memorial Day weekend. However, the prices seen on Saturday are much higher than in previous years.
The War in Ukraine and the subsequent sanctions on Russia, a significant oil producer, have increased oil prices worldwide. To mitigate this, attempts have been made to increase supply by increasing US oil production. President Biden has also ordered a release from the Strategic Petroleum Reserve last month when prices hit $4.20 a gallon.
Inflation has also been steadily increasing, reaching an 8.6% increase in consumer prices in the last 12 months, making necessities like food and energy inaccessible to many.
Most sectors of the US economy are seeing very high inflation figures. This has prompted the United States Federal Reserve to raise rates by three-quarters of a percentage point, making it increasingly difficult for consumers and businesses to take on loans.
This aggressive rate increase is the biggest since 1994 as the United States is expected to face an economic downturn and rising unemployment.
Inflation now affects virtually every aspect of the economy and increases the likelihood of a recession. Basic necessities and proper living conditions will likely become increasingly inaccessible to many Americans in the coming months.
Current inflation levels are often attributed to rising demand and increased government spending. Also, the most common solution proposed is rate hikes by the Federal Reserve, making it more difficult for Americans to access much-needed loans and mortgages in already struggling labor and housing markets. However, the causes and the efficacy of the solutions put in motion by the White House and the Federal Reserve are subject to much debate and criticism.
For Instance, when asked, the Green Party of the United States warned that “Raising interest rates will put pressure on workers while doing nothing to address what’s driving inflation.”. Contrary to the mainstream narrative, the Greens believe that current inflation levels are due to “the breakdown of global supply chains from the pandemic and the war in Ukraine.” and “Both of those catastrophes were aggravated by the U.S. and other governments prioritizing corporate profits over people, planet and peace.”
To counter the effects of inflation and prioritize people’s wellbeing, the Green Party proposes “price freezes and taxing excess corporate profits” and putting in motion “initiatives like an ecosocialist Green New Deal to eliminate our dependence on fossil fuels while revitalizing public services through an Economic Bill of Rights.”.