Baby formula isn’t something I expected to write about or have ever written about before. But you never know where bad government policy will take you.
A nationwide formula shortage has brought panic-buying (and simple panic) to those with infants to feed. Store shelves are empty, as they have been with other products for two COVID years. The crisis is getting worse, and there is no sign of relief.
Naturally, there is also a scandal; while Americans can’t find formula, the federal government is shipping plenty to the southern border for illegal immigrants.
The Biden administration, knowing public dismay and anger are bad for Democrats in the midterm elections — they weren’t worried when formula supplies began running out five months ago — says it’s “doing everything in [its] power to ensure there is adequate product available.”
But it isn’t — just as it isn’t doing all it can to cut energy prices or, as President Joe Biden recently claimed, just as his top priority is not beating inflation generally. His top priority is to make excuses for failure and to spend more of your money, which makes inflation worse.
But back to formula. What caused the shortage? Several things. One was a February recall of tainted formula made in Michigan. Another is that manufacturers were unprepared for hoarding during the pandemic.
But it’s also because they can’t find workers, and raw materials and commodities are getting more expensive. These are due to Bidenflation — producer prices are 11% higher than a year ago — and the Democrats’ unnecessary splurge of $1.9 trillion on “COVID relief” last March. That largesse paid people not to work, so they didn’t. Unnecessary lockdowns and falling real wages also drove workers out of the labor force. There are now 11 million unfilled jobs nationwide, some of them at baby formula factories.
Formula is especially interesting not merely because it affects so many people. It’s also because most of us writing about politics don’t think about it often (as I suggested up top) and because it shows how everything is linked to almost everything else by the economy.
Baby formula is connected (to take a perhaps obscure example from the other side of the world) to political violence in Sri Lanka. Pandemic lockdowns, shortages, and inflation, all of which stanch formula supplies in the United States, also crushed Sri Lanka’s tourist industry, drained its foreign currency to zero, and (along with government corruption) drove its people to revolt.
No policy is an island. Each is a stone dropped into a pond, and the ripples splash up somewhere else. If you shut down businesses to appease your political base, if you pay people to stay idle, if you borrow money to look caring and buy votes, and if, in the process, you push up interest rates, there will be unintended consequences, both predictable and not.
Money — the one-word core of inflation, wages, buying power, shortages, jobs, business success and failure — is like water because it seeps into everything. Sometimes, it buoys them up. But sometimes, it sinks them.