Dear Editor: Rising prices and lowered incomes are inevitable; here is how to adjust


“[…] The spread of Covid-19 has disrupted households and businesses in the form of reduced economic activity which has affected wages and revenue. This disruption leads to a lowered standard of living/poverty, or price increases to prevent business losses which then results in inflation…”

The following Letter to the Editor on combating rising prices and lowered incomes resulting from Covid-19 disruptions was submitted to Wired868 by Antonio Decklan Ross:

Image: A satirical take on life during the Covid-19 pandemic.

The basic fact is that, in a capitalist system, the goal of an individual/business is to increase wages/revenue in order to offset cost of living/expenses, so as to improve standard of living/save/make a profit.

Every person/household/business carries costs (fixed and variable). Fixed cost is constant and therefore does not change regardless of what you do. Variable cost depends on the activities carried out within a specific period of time in a home or business.

Wages/revenue are used to offset costs. Depending on your form of employment or business, wages/revenue are either fixed or variable.

Efficiency in a household or business is a situation where little to nothing is wasted. Inefficiency is a cost. Depending on the nature of a business, idle equipment is considered ‘waste’ because it carries a fixed cost but does not generate revenue.

The spread of Covid-19 has disrupted households and businesses in the form of reduced economic activity, which has affected wages and revenue. This disruption leads to a lowered standard of living/poverty, or price increases to prevent business losses, which then result in inflation.

Image: A satirical take on the predicted economic backlash to the Covid-19 pandemic.

This logic can be applied in the case of the taxi/taxi-driver as well as a bakery.

A taxi-driver with a fixed cost at home and an increasing cost of living due to inflation can only offset this by increasing earnings through a hike in the taxi fare.

A taxi carries fixed and variable costs. Its operating cost will increase due to the raised cost of parts and repair labour, which again can only be offset by increasing taxi fares. And consider too the cost of inefficiency due to reduced capacity caused by Covid-19 regulations.

(I deliberately separated taxi-driver from taxi because those are two different ‘business entities’.)

In the bakery, there is the disruption of the labour force due to Covid-19 illness, reduced sales by small/medium/large vendors due to the lockdowns, which lead to reduced revenue and idle equipment while still carrying fixed costs such as bank loans. And there is the increased cost of raw materials used to make finished products for sale as well as increased distribution cost.

Image: A customer reacts to high prices.
(Courtesy FinanceTwitter)

What can YOU do to battle loss of wages/earnings or inflation?

  • Do a WRITTEN budget
  • Be creative and industrious
  • Utilise your time wisely by converting it into money
  • Swallow your pride and engage in economic activity that you may have previously considered to be beneath you
  • Reduce your cost of living and that of your household.
  • Seek out and utilise more government subsidised services, such as buses, public healthcare, social services, etc
  • Ask for HELP

Please note, I am not making a case for price increases but merely trying to explain—from a layman’s perspective—how you can overcome them.

More from Wired868
Dear editor: Farewell to a true Gens de Arime—everybody loved Raymond Morris

    “[…] A true Gens de Arime, Raymond was loved and appreciated for his kind and generous spirit. “He Read more

Orin: The potential cost of UNC’s civil war

“[…] Ever since she ran in 2015 on a leader-centric election marketing campaign that sold the virtues of Kamla The Read more

Noble: Get tough on Crime Talk—T&T must address roots of criminality

If you had a leak at your home, what would you do? Will you buy a mop and then a Read more

Dear Editor: Calypso Fiesta should be only road to Big Yard—not Tobago Monarch!

“[…] It is totally unfair to all semi-finalists that a calypsonian who won a competition in Tobago months before, under Read more

Dear Editor: Why was Thomas-Felix moved? Industrial Court owes T&T transparency

From the onset I wish to indicate that I hold no brief for either the outgoing office holder or the Read more

Dear Editor: Senator Richards must prove allegations against Alexander, or apologise!

“[…] Dr Paul Richards is not only an independent senator, but also a very experienced journalist. He ought to know Read more

About Letters to the Editor

Want to share your thoughts with Wired868? Email us at editor@wired868.com. Please keep your letter between 300 to 600 words and be sure to read it over first for typos and punctuation. We don't publish anonymously unless there is a good reason, such as an obvious threat of harassment or job loss.

Check Also

Dear editor: Farewell to a true Gens de Arime—everybody loved Raymond Morris

    “[…] A true Gens de Arime, Raymond was loved and appreciated for his …

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.