by John A. Tures, Professor of Political Science, LaGrange College
At one point during the pandemic, the inflation rate hit its highest levels since the late 1970s and early 1980s. But thankfully, it’s come down significantly. The projections for 2024 look even rosier. But inflation doesn’t strike all of America equally. How is the area around Atlanta faring? And how does North Georgia’s outlook compare to the rest of the country?
As Adam McCann, a Financial Writer for WalletHub notes “The year-over-year inflation rate has moderated to 3.4% in December 2023, which is welcome news to the Federal Reserve as it considers the monetary policy outlook.”
And Matthew Boesler from Bloomberg finds that the news looks even better this year. “US inflation is set to further recede in 2024, ending the Federal Reserve’s 2% target as economic disruptions from the pandemic face further and prices of some goods even decline.”
Professor Michael Meeropol from Western New England University on WAMC says there’s more good news. “For FOUR DECADES lower wage workers have been losing out – but in the last three years, they have gained back 25 percent of what they had lost relative to their more affluent fellow workers. That’s very good news indeed === news that the nay-sayers who have been screaming about inflation for over a year will almost certainly ignore.”
One of the reasons why President Joe Biden may not be getting the full credit he might otherwise be getting for the good economic numbers is that inflation isn’t affecting the country the same everywhere. Certain areas are recovering more slowly than others from the inflation surge.
To determine this, McCann analyzes not only a number of key metro areas, but also standardizes what is being looked at. “To determine how inflation is impacting people in different parts of the country, WalletHub compared 23 major MSAs (Metropolitan Statistical Areas) across two key metrics related to the Consumer Price Index, which measures inflation. We compared the Consumer Price Index for the latest month for which BLS data is available two months prior and one year prior to get a snapshot of how inflation has changed in the short and long term.”
Of the 23 analyzed areas, Atlanta and the surrounding area is twelfth on the list of cities with the biggest inflation problems, and showing high growth compared to a year ago, according to McCann with WalletHub. This may explain why Biden is not doing as well in the Peach State surveys among Georgia voters, as Atlanta is supposed to be the backbone of his Georgia campaign. But there is some good news; Georgia’s Consumer Price Index Change (latest month versus two months before) is heading down, providing some potential for relief.
Other metro statistical areas aren’t doing so well, and many of them are in the Sun Belt, like the Dallas-Forth worth area, Miami area, Honolulu, San Diego area, Tampa-St. Petersburg area, the Houston area, the Riverside-San Bernardino-Ontario area in California. Few frost belt sports are ranked higher for inflation (Detroit and Philadelphia areas are exceptions). You can find some Western spots like Denver area as well as the Seattle-Tacoma area ahead of Atlanta as well for inflation rates.
The biggest decision for the Federal Reserve will be how aggressively to attack inflation with higher interest rates. You don’t want to throw the economy into a big recession by too aggressively choking off the money supply (like the two recessions of the early 1980s) and growth may matter just as much to the president’s reelection efforts. A modest easing of inflation, and keeping a lid on other crises that could affect the supply chain, should do it, for Georgians and the country.
John A. Tures is a professor of political science at LaGrange College in LaGrange, Georgia. His views are his own. He can be reached at jtures@lagrange.edu. His Twitter account is JohnTures2.
