Tags: Food Price | Inflation | Wages | Pay

Market Strategist Colas: Food Inflation 'Far Greater' Than Government Admits

By Dan Weil   |  

Wages aren't keeping up with food inflation, creating a problem for American families.

While consumer prices overall have risen 6.4 percent since 2011, chicken has jumped 18.4 percent, ground beef 16.8 percent and bacon 22.8 percent, CBS News reports.

"Food inflation is far greater than the government thinks it is," ConvergEx market strategist Nick Colas told CBS.

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At the same time, median income has gained only 1 percent a year, CBS reports. That makes it difficult for parents to save for their children's college expenses. College tuition has increased 6 to 8 percent a year for the last five decades, according to CBS.

While some economists see the overall economy in fine shape, "middle-class families are quietly struggling," writes CBS correspondent Michelle Miller.

Colas is concerned. "The disconnect is severe, because it's the economists that make policy but it's the people who have to live with the outcome of that policy, and that disconnect is growing to the point where I think it has to break soon," he said.

Meanwhile, former White House economic adviser Lawrence Summers says that if we don't correct our gaping income inequality soon, the results won't be pretty

"The share of income going to the top 1 percent of earners has increased sharply. A rising share of output is going to profits. Real wages are stagnant. Family incomes have not risen as fast as productivity," he writes in the Financial Times.

"The U.S. may well be on the way to becoming a 'Downton Abbey' economy." Downton Abbey is a U.K. TV show which chronicles a wealthy British family and its servants in the early 20th century.

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