Affordability Crisis? You Betcha!

Here’s one of the greatest certainties facing every household in America beyond the proverbial prospect of death and taxes: Namely, the monthly electric bill, as it arrives like clockwork either in the mail or by auto pay. And, according to Grok 4, there are approximately 143 million customers getting a metered bill each month.

Needless to say, the political hot potato of “affordability” does very much come to mind when you take a gander at the CPI electricity graph below. On a nationwide basis, electric bills rose by +6.7% during the first twelve months of the Donald’s second term, and that was just more of the same punishment to household budgets that has been underway since February 2020.

In fact, the average increase since then has also been 6.7% per year, meaning that there has been no deceleration during the past year; and that the contrast with the longer-term trend prior to February 2020 has not been lost on the voting public.

That is, the CPI for electricity rose by just 1.1% per annum between December 2012 and February 2020, bolstering the impression of very low steady-state inflation for basic home utilities. But owing to the abrupt climb since then, the December electric bill for 143 million households came in 40% higher on average than in February 2020.

Needless to say, that’s the part which is top of mind for hard-pressed households. In effect, they voted in November 2024 for relief from the high cumulative inflation depicted by the electric bill CPI below, not merely for a reduced rate of price increase, which in this case didn’t happen, either.

CPI for Electricity, 2012 to 2025

The above chart offers a powerful insight as to why the MAGA talking point about the rate of inflationary increase slowing down doesn’t resonant with the electorate. In case after case of recurring cost of living purchases, household budgets remain impaled on the high price levels for everyday goods and services which have erupted since 2020.

https://davidstockman.substack.com/p/affordability-crisis-you-betcha