Guest Posts on County 10 are provided by contributors and the opinions, thoughts, and comments within are their own and may not necessarily reflect those of County 10.
A load of four-hundred-pound steers rolled onto the floor of the Riverton Livestock Auction a couple of weeks ago. Buyers and sellers were equally shocked as the selling price blew past three dollars, then four dollars before the gavel hit a seemingly astronomical price of $5.05 per pound. That equates to a little over $2000 per calf.
If you’re not interested in cattle prices, oh well, you will soon when you head out to buy hamburger, steak or roasts. It is an extraordinary omen of what is about to happen with food prices in the United States.
Americans like to complain about the price of everything, it is only going higher. That’s true when you consider the price you pay at the pump for gasoline, at the grocery store, or for any other retail item. Inflation is a real problem, and it is destroying the economic power of the dollar.
I started my teaching career in Lusk in 1980. The starting salary was $13,000 a year, with an additional 10 percent added on since I coached football, basketball, and track, and served as Student Council, Close-Up, and sophomore class sponsor.
The $14,300 I earned seems trivial today, but a dollar in 1980 buys $3.83 worth today. My salary was a decent $54,769 in today’s dollars, not bad for a single 23-year-old with no college debt. Niobrara County was the lowest paid district in the state at the time, so my colleagues starting out made even more.
The car I drove, a 1978 Ford Fairmont, cost just $5800; I paid $200 a month for rent, utilities included, and spent the rest on savings, food, hunting, and entertainment (in that order.) In retrospect, it was a great life for a 20-something.
Is that possible today?
The short answer is yes. If you’re willing to work, buy sparingly and don’t overindulge, but society doesn’t want that, and retailers definitely don’t. That’s why the average American now has almost $9000 in credit card debt alone.
Revolutions begin over food prices. The French, Russian and Chinese Revolutions all began over food shortages.
When Marie Antoinette flippantly lost her head with this offhand remark, “Qu’ils mangent de la brioche” and then her actual head to the guillotine a short time later, she displayed the out-of-touch arrogance of the elite with the plight of the common man. “Let them eat cake,” was her smartass response to news that the French people were starving and couldn’t afford bread. The masses dealt with the one percent of their day with torches and pitchforks. But at the end of the French Revolution, they lived under a dictatorship.
A century later, the Russian people were starving while their leaders, the Romanovs, lived lives of extravagant luxury.
Czar Alexander II was blown up by a bomb in 1881, but that didn’t stop his heir, Nicholas II from ruling with the same detached indifference to the suffering of the Russian people. Add to the Czar’s unpopularity was a constant series of wars the Russians lost in Crimea to England, in Siberia and off the coast of Vladivostok to the Japanese, and then the slaughter by Germany in World War I.
The Russians killed Czar Nicholas’ entire family, and you guessed it, replaced him with a dictator, Lenin.
In 1919, Germany signed an Armistice and then faced the indignation of the Versailles Treaty which essentially blamed them for the damages of World War I.
At first, there were no assassinations, just a ground-roots movement started by an obscure Austrian corporal in a beer hall in Munich in 1923.
Hitler found support because the German people couldn’t afford food. Inflation was the worst in human history, with grocery sacks of German currency necessary to buy just a loaf of break. In January 1923 a loaf of bread cost 250 Marks, by November the cost was 200,000,000. In 1924 the Germans printed a one-trillion Mark note, worth about $4.20 in American currency of the era.
Yes, largely because they couldn’t afford food, the Germans voted in the world’s most sinister dictator in its history.
The world wasn’t quite finished. In 1949, somewhere between 25 and 50 million Chinese people starved to death. The famine led to yet another revolution, ending with yet another dictatorship, this one by Mao Zedong.
What do any of these events have to do with us today?
“It’s the economy, stupid,” Democratic strategist James Carville said during the election battle between Bill Clinton and George Bush in 1992. It was enough for Clinton to win the election. In creating 23 million jobs, raising taxes on the wealthy, cutting welfare and military spending, Clinton was the only president in recent history to reduce the national debt and create a strong rising economy.
Jump ahead 30 years and it’s the economy again.
The COVID-19 Pandemic destroyed America’s economy. It created shortages, and as we all know, shortages raise prices. It’s simple supply and demand.
The price of bread, a metaphor for groceries overall, increased dramatically in the last three years. The increase was enough to swing support for economic change. The Biden administration foundered helplessly against the perceived inflation.
Yet the spending during the 2024 Christmas season was one of the highest ever recorded. Where was the money shortage? Supporters of incoming president Trump claim it’s all based on confidence, detractors note that the economy had grown stronger under Biden over the last four years. Who knows?
What we do know goes back to that cattle auction earlier this month.
Riverton is a small dot on the overall cattle market, but it accurately reflects the state of the market unerringly.
If buyers are willing to drop two grand on a newly weaned calf, they expect the market to grow.
Getting that 400-pound calf to a market ready 1200 pounds takes a year in the best case, and a bit more with lower quality cattle. It will take about six tons of hay at about $900 total and another $100 or so in corn and oats to have that calf reach market quality. At $3 a pound, there isn’t much wiggle room for producers after transportation, facility costs, veterinary and other expenses, unless the price at your local meat counter reaches $30 a pound for T-bones, and $12 a pound for hamburger.
Wait for it, it’s coming.
The upcoming tariffs on Argentinian, Brazilian and Australian beef will be reflected in increased domestic beef prices. It’s boom time for ranchers, but not so much for consumers. The buyers paying $5+ per pound for calves are banking on this.
Trump promised he would lower grocery costs the minute he was elected. After he won, one of his first statements was that lowering grocery prices was too hard, there wasn’t much he could do.
Oh well, politics as usual.
You get what you vote for and we’re about to rediscover for the dozenth or so time what tariffs do to consumer prices.
English Prime Minister Benjamin Disraeli famously said. “Assassination has never changed the history of the world,” in 1865 in response to the news of Lincoln’s murder. Disraeli was right, assassinations accomplish nothing.
Revolution rarely brings what the revolutionary hopes for, assassination fails even more miserably.
Change takes careful forethought, not violence or ignorance.
It starts at home with wise financial decisions and not buying what you can’t afford. It ends with state and federal policies that help citizens, not only corporations.
Hang on for the upcoming ride.