If Alan Greenspan Lived In Huntsville, Alabama!
Why Is It Okay to Set the Price of Money?
AUGUST 01, 2002 by TED ROBERTS
Filed Under : Federal Reserve, Inflation
I wish Alan Greenspan lived here. That way he’d know that there’s a Huntsville, Alabama, grocery chain selling chicken leg quarters for 29 cents a pound. That ain’t exactly a sign of inflation. Consequently, the next time the Federal Reserve Board met:
- Mr. Greenspan and his pals wouldn’t touch the button marked “mash to raise rates.”
- The stock market wouldn’t turn south to Antarctica.
- I might be able to afford that dark blue Camaro my wife says is “too juvenile” for a semi-balding senior citizen whose weight is beginning to affect his gas mileage.
Twenty-nine cents a pound for chicken parts is pretty impressive, but the record low price was struck September 22, 1997, at 8:30 a.m. I was enjoying a cup of coffee (Folgers French Roast, $3.89 a can) as I surfed our local paper. Suddenly, there it was at my feet, half hidden by the Sports and Business Sections, but appropriately illuminated by a sunbeam-the Foodworld ad.
“CHICKEN LEG QUARTERS 19-CENTS A POUND,” it announced. And you don’t even have to pluck the feathers. You did have to buy a ten-pound bag, said the ad. Fair enough. Who wouldn’t want 20 chicken dinners for a buck ninety? At that price it’s cheaper than canned cat food, which goes for almost a dime an ounce. (Remember the United Way ad with the impoverished old lady, who looked just like your grandmother, digging into a can of cat food? Tug at your heartstrings? Well, she could have supped cheaper on drumsticks bordelaise!)
Never in my 20-year-old collection of leg quarter stats had I seen such a bombshell. The previous record (not noted in the news or editorial section of one American newspaper at the time) was 29 cents.
Yes, I’m a leg-quarter freak. I’m out of the pantry and I’m proud. Car loadings, trade balance, warehouse inventories, the Consumer Price Index, and CEO dismissals are intriguing stats for economic algorithms, but give me chicken parts every time as a prosperity gauge. At 29 cents a pound, we can all eat like Henry VIII at his Sunday buffet.
So no matter that 15 million Americans, at bedtime, have difficulty breathing out of both nostrils simultaneously; and of those, two million suffered a gender, ethnic, occupational, or culinary slur in the past two weeks. The stars and stripes are happily streaming in the breeze and bands are playing and children laugh and shout because drumsticks–stewed, fried, baked, or barbecued–are only 29 cents a pound.
And guess what three pounds of chicken for a buck says about the CPI. We’re not talking trivia like popsicles in Peoria or subway fares in Manhattan. We’re talking chicken–a universal filler for American tummies. Can you imagine Mr. Greenspan (who’s probably a devotee of leg quarters stewed down with onions and carrots) raising rates in the face of this deflator? Picture the roll call of the Federal Reserve Board of Governors–each member, hand in air waving a fried chicken drumstick, voting to let the marketplace establish the price of money like it does for leg quarters.
How has this stomach stuffer–this supper staple–dodged that devil, inflation? As a twentysomething husband in the ’50s trying to put chicken on my family table, I can’t recall such a price. And I was at least as sensitive to our grocery bill as I was to my mother-in-law’s birthday. The business of growing, processing, and delivering drumsticks to the consumer has blossomed over those four decades: on a par, I’d say, with that of the computer industry, which has also slain inflation. The tool is the same–technology.
And why is it that every grammar-school student of economics who can make change properly understands the futility of central planning, but nobody trembles when we manipulate the price of money itself–the very oxygen of the economy. If Karl Marx rose from his underworld grave all drippy with slime like some swamp monster . . . if he lurched into the Fed’s meeting and seated himself next to Alan Greenspan . . . if he held up his hand like a polite parliamentarian . . . and upon recognition suggested the Fed set the price of pickles, they would laugh him out of the room. But with money, it’s okay?
A Dash of Imagination
To those careless economic analysts who stroll through life ignoring chicken leg quarters, let me point out that there are “A” and “B” quality quarters. These were “A’s,” explained the Foodworld meat manager, meaning they had more white meat, less back attached to the drumstick. And endearingly amenable to the same treatment as filet mignon, quail, and Long Island duckling. A handful of chopped onions, a clove of garlic, a dusting of flour, a couple soupspoons of cheap red wine, and a little imagination puts you at a Michelin 5-star eatery-without tip and a snooty, palms-up maitre d’. Go ahead–pick any one of the four chairs at your kitchen table. You’ll be the envy of billions of inhabitants of Asia and Africa who get their protein from fish meal or locusts.
When the Federal Reserve Board meets again, whether in D.C. or Huntsville, what if each place at the conference table is graced with a big plate of coq au vin (featuring you know which cut) and a stack of grocery ads illustrated by plump, curvaceous chicken leg quarters. Think they’ll raise rates?
Ted Roberts is a freelance writer in Huntsville, Alabama, who often writes on public-policy issues.