"The Hidden Impacts of Inflation"

Inflation impacts more than what people see at the grocery store. In this conversation, we discuss how rising costs affect government services, roads, public investments, retirees on fixed incomes, and the everyday lives of West Virginians. From state budgets to long-term financial responsibility, this segment explores the hidden impacts inflation can have across communities

Transcript

SPEAKER_00 0:07

How do you how do federal financial policies like interest rates or debt management affect how you manage West Virginia's finances?

SPEAKER_01 0:17

Well the interest uh in f first of all, I think inflation impacts government as much as it inf impacts uh individuals. Okay. Um so the cost of providing government services uh is is continuing to go up. And so we've had an extraordinary amount of inflation over the past few years and it seems to be really sticky. Uh we know what that's done to households, right? The the the price of gasoline, the price of medical care, the price of food, I mean just whatever you want to talk about, price of electricity. Uh but it's also really impacting the state. There's some places inflation kind of helps the state, but overall it's really been tougher. I mean, just paving a mile road is probably twice as much as it as it was five years ago. Uh buying an ambulance is I think maybe three times as much as it was a few years ago. So, so you know, inflation is is caused by the federal government, uh, but when when when they cause inflation to federal government level, it costs all of us, uh without a doubt. So just trying to figure out how to how to um react, how to how to manage through that, uh we're much better if we get inflation down to around one and a half, two percent. Uh, but this this this three and four is really making it hard to do that. And just think if you're a you're a pensioner, so you're a pensioner, the way West Junior works, with your pensioner, when you retire, you get it whatever your number is. And so say it's $3,000 a month. But there's no uh cost of inflation deal. So it's ten years from now, it's still three thousand dollars a month. So we really hurt our retirees, it's really hurting our retirees. And even my my mother's 86, and she she said a few weeks ago, she said, do you realize how hard people pay work to pay their pay the taxes? Right. So she's reminding me that people work really, really hard to pay their taxes. We need to make sure we spend it more efficiently.

SPEAKER_00 2:01

Yeah, I think that's something that a lot of people don't look at, even statewide, is is the retirement. Yeah, that's so true. Um how where do you see opportunities for better coordination between the U.S. Treasury and the state treasurers like yourself?

SPEAKER_01 2:15

Well, I I think the uh treasure uh the Secretary of Treasurer Bessett, I think he's an absolute rock star, by the way. He's he's I think he's brilliant. And and I I I think I also wish he had more than four years. Uh but I think he he's working really hard to get Washington and I think to get all the different um initial guys up there focusing on what inflation is doing to regular Americans. And he talks a lot about that. So from our from our standpoint, it's listening to what he's putting out, throwing in some input from from time to time. Um but these policies, these these uh where we have the the you know almost a $40 trillion debt, there's a real impact to real people. And so we have this divergence going on where um uh the higher income folks are doing way too well because so much of their wealth is based upon the stock market. Yeah. Uh but then if you're a normal person, right, and West Virginia is made up of normal people, uh, they're not participating in as in much into that deal. So how do we kind of work work through that? Uh he talks a lot about AI and what's the impact of AI going to have on a typical West Virginian. And there's some good parts, but there's possibly some negative parts. So just continuing to talk about it, uh, continue to communicate, continue to listen. I think one of the interesting things was is you know, the elimination of the penny, that was kind of kind of a excuse me, necessary, but also kind of interesting as well. But you know, in typical government fashion, we stopped making pennies when we finally realize it's costing us, I think, four cents to make a penny. And so when it's three cents wasn't enough, two cents wasn't enough enough, four cents.

SPEAKER_00 3:52

Okay, let's stop.

SPEAKER_01 3:53

This is nuts.

SPEAKER_00 3:54

Yeah. Uh one thing I do want to go back to, um you mentioned the stock market and then you know the debt, uh the 40 trillion that we're in. Do you think that's going to have a way on the market or eventually cause the market to crash?

SPEAKER_01 4:09

I know the causes crash, but it but I do think it causes inflation. Because what's happening is from a federal government standpoint, we're spending much more money than we're taking in. In other words, we're we're we're making dollars just to pay the bills and so forth. And that in itself creates inflation. The easiest way to get inflation down is we we get a balanced budget. So somehow, somehow, we've got to get to this balanced budget. I I think what we're doing to our grandchildren, to our great-grandchildren, you know, my age, is absolutely horrendous, right? So we're spending money that they got to pay back. And at some point, we need to be responsible adults and and and get a handle on this. But you know, Washington's broken. Um we do a lot of uh performative stuff in DC these days. We do a lot of uh talking past each other, but we don't really seem to be able to get together to fix real problems. I mean, we can't they can't even pass a budget, right, to pay the uh some of the homeland security people, right? I mean how how dysfunctional is is that.

SPEAKER_00 5:10

Yeah.

SPEAKER_01 5:10

Uh but at some point it is going to create problems. Uh I mean it's already creating problems. At some point it could very well could create some bigger problems. Nobody knows because we've never had this much debt before. And there's a lot of opinions about where and when. But generally when you have a you know a bad turn, it generally happens quick. Uh, and so we just need to see. But I think best it's trying to get get an answer to it um and trying to get people to start focusing on it. But you know, it's been a long time so since anybody's ran for Congress, ran for Senate, and said, Let me let's talk about the budget. Right. Yeah, yeah. So maybe so that when we start seeing people running for that, we'll know that it's it's risen enough in the polls that people care about it. But right now, I think uh we just don't have it focused on that at this point.