‘Inflation psychology’ at work

I have been “making market” at the Chaguanas market for 25 years. On July 29, I purchased my regular items; on August 12, I was taken aback at the prices of some of these same items. During this two-week period the price of cabbage moved from $2.50 to $6-7 per lb; baighan from $1.50/$2.00 to $5.00 per lb; sweet pepper from $5.00 per lb to $12.00 per lb. For some reason christophene has been quite high.

Usually, $2.00 can purchase a large one; now it is selling at $12.00 per lb. The price of tomatoes has remained very high, selling for between $7.00 to $12.00 per lb according to size. This is reminiscent of the last boom period. Potato (alloo) which I purchased for just $1.50 per lb on July 29 sold for $3.00 per lb. One can go on and on.

An indication of the inflationary spiral is reflected in the price of the favourite “doubles”. Within a short period of time the price escalated from the established $1.00 to $1.50 to $2.00. There is an inflationary psychology at present.

There is price fixing among vendors at the Chaguanas market. I have witnessed one vendor passing around and telling other vendors at what price to sell items.

They all stick to pre-arranged prices — there is the absence of competition. Now an inflationary psychology is added.

The responsibility for this has to do with the Government expenditure. This more than any other factor is responsible for the situation. These prices are the same ones experienced during the last boom period (1973-1983).

History is repeating itself. We seem to have learnt nothing from our past experience.

Now it is being suggested that trade unions must refrain from making demands for wage increases consistent with the price of foodstuff and inflation.

We are in a vicious cycle. Clearly, the government must curtail its expenditure to bring some kind of control over inflation.

K P SINGH

Carapichaima