Beef
There are lots of reasons for rising costs. And, some of those are completely out of everyone’s control. For example: beef prices are going up, because it’s been a “bad year” for cows. Really, the actual number of beef cows in the United States is the lowest since 1951 (MarketWatch). Sure, there are global reasons: climate change, drought and such. And we can talk about the political ramifications of that. But the bottom (round) line is this: there are fewer beef on the market, and the market is way, way bigger than it was seventy-four years ago.
Supply and demand: that’s the central factor in determining cost. If the supply is lower, and the demand is higher, then the cost (price) will go up. There’s less beef, with a much greater demand today. So, Pataskala Kroger’s is charging $19.99 a pound for a ribeye, $6.99 a pound for 80/20 hamburger. Remember how upset everyone was with the Covid meat price hike. My goodness, 80/20 hamburger went up to $6.00 a pound. We’re past that now.
Little Blue Vans
Here in Pataskala, we have a “micro-market” that sets the price for gasoline. The demand for gas is higher here than in the neighboring communities. That’s because of an Amazon distribution center (I think there’s seven giant buildings, including the “Fulfillment Center”). And from one of those buildings, there’s a swarm of little blue vans that go out, every day.
That’s Amazon fulfilling their bargain, swift product delivery to your door. And all of those swarming little vans have to fill up at the local gas stations, BP, Kroger, UDF, Sheets, Shell, and the rest. And because of that increase in “demand”, the cost of gas in Pataskala is often $0.20 higher than nearby Reynoldsburg or even closer Kirkersville. Want to buy gas at UDF around the corner? There’s a price to pay for the convenience.
Eating Taxes
And we can look forward to the impact of the Trump Tariff policies. Like it or not, in the long run most businesses will find a way to distribute the new costs of tariffs (import taxes) to the consumer. Sure, right now, some are absorbing the tax costs to avoid the political ramifications, but that’s not going to last.
Any business has a primary goal: to make profit for their owners (usually the shareholders). That’s what Capitalism is all about. While in the short term, reducing profits by “eating” the additional taxes may make good business sense, in the final analysis, the “owners” are in it for the money. The costs will get passed along to the consumer. Tariffs are just another consumer tax, and, as often is the case, they will have a greater impact on those with lower incomes.
Energy
As for the rising cost of energy, it’s a good time to be an energy company shareholder. The second quarter of 2025 AEP (American Electric Power) declared a $1.2 Billion profit, almost four times greater than 2024 (ABC). And, as any AEP Ohio consumer can tell you, the price of electricity is going up. It’s not just the actual cost of electricity, it’s all of the associated costs: delivery fees, existing infrastructure upkeep, new infrastructure development. That does make sense, at least, around here in Columbus, Ohio. The whole region is expanding, and more and more power is needed to reach out to the developing industries and residences.
And it’s even more than that. Unlike cows, there’s more energy generation going on in Central Ohio than ever. But the demand is increasing far beyond the existing supply. It’s not just the stalled Intel Chip plant a few miles north of here. Industry is booming all through Central Ohio. What used to be fields in Pataskala, or Ashville, or Marengo (all twenty plus miles outside of downtown); are now solar panel factories, or an advanced military drone plant, or giant distribution centers. All of that means more power is needed.
Regulation
Back to supply and demand: the demand for power is exponentially increasing, and the supply is far behind. So the cost of electricity by the kilowatt is going to go up.
Should the power companies “eat” that cost, especially with the incredible profits they’re making? Maybe; they are publicly regulated monopolies here in Ohio. While I can buy a different provider for my power, it’s still coming in on AEP’s lines. The problem, of course, is the Public Utility Commission of Ohio, the “regulator”, is made up of five members all appointed by the energy industry friendly Governor, Mike DeWine. Some have long “experience” in the energy industry. The foxes are in charge of the chicken coop.
The pressure is on the consumer. Because if prices go up, either consumers find ways to cut (reduce the demand) or they find more income (increase their personal supply of money). It’s a balancing act, especially for those with “fixed” incomes. With all of the other political craziness in our world, this issue is still likely to be the most important factor in determining who gets elected.
So while many of us, including me, think that the Trump Administration represents an existential threat to the American Democracy, it might all still come down to the price of 80/20 hamburger, or kilowatt hours, or the price of eggs. Right now they’re $3.59 a dozen at your friendly, Pataskala Kroger’s. By the way, Kroger made a 4% increase in profit over last year, $10.57 Billion in the first quarter of 2025.
