You are buying the same things this week that everyone buys this week: ground beef, buns, strawberries, something for the cooler. A national headline has good news for you - "July Fourth cookouts are cheapest in 10 years after inflation" - and the White House is taking a bow for it, with spokesman Kush Desai crediting the administration for "limited price increases" and promising "Americans are set to see more economic relief." [1]
Now look at the survey that headline is built on. The American Farm Bureau Federation priced this year's cookout for ten people at $73.82. That is up $2.90 from last year, a 4 percent jump, and the highest cost in the survey's history, going back to 2016. [2] The two pounds of ground beef in that basket cost $14.06, up 5.5 percent - the highest beef price the survey has ever recorded. [2]
THE CLAIM "Farm Bureau: July Fourth cookouts are cheapest in 10 years after inflation"
- The Washington Times, headline, June 26 [1]
What the basket actually did
The Farm Bureau's own release is titled "Cost of Fourth of July Cookout Reflects Inflation Increase," and the line items tell you why: pork and beans up 13.8 percent, strawberries up 12.4 percent, hamburger buns up 7.7 percent, ground beef up 5.5 percent. [2] Overall food inflation is running 3.1 percent, and overall inflation 4.2 percent, for the twelve months ending in May. [2] Fox Business read the same survey and headlined it the way your receipt will: "Fourth of July cookout prices hit record high." [3]
Data
| Pork and beans | 13.8% |
|---|---|
| Strawberries | 12.4% |
| Hamburger buns | 7.7% |
| Ground beef | 5.5% |
| Overall food inflation, 3.1% | 3.1% |
The trick is the denominator
Here is how a record-high number becomes "cheapest in 10 years." You take the grocery basket, which rose 4 percent, and divide it by overall inflation, which rose 4.2 percent. Groceries went up slightly slower than everything else, so in "real" terms - after inflation - the cookout looks like a relative bargain. [1][2]
The arithmetic is real, and economists use inflation-adjusted prices for good reasons. What the arithmetic cannot do is put money back in your pocket. Your cookout costs more dollars than it ever has; it only looks cheap because your rent, your insurance, and everything else you buy rose even faster. [2] Calling that "economic relief" gets the direction backwards: the burger is a bargain only by comparison to a bigger squeeze.
THE RECEIPTS
- $73.82 to feed ten - the highest cost in the survey's history. [2]
- $14.06 for two pounds of ground beef, up 5.5 percent - the highest beef price the survey has ever recorded. [2]
- Overall inflation 4.2 percent - the denominator that turns a record into a "bargain." [2]
- Even Fox Business headlined the same survey "record high." [3]
THE BOTTOM LINE The cookout hit a record in the dollars you actually pay. "Cheapest in a decade" is what a record high looks like after you divide it by everything else going up faster.
The register does not take ratios. It takes $73.82. [2]
