mexican food prices are up

If you are already here in Mexico, you have most likely encountered the phenomenon -- either in restaurants or at the grocery. If you are not yet here, but intend to be, you probably have heard the chatter on Facebook.

And it is true. Food prices in Mexico have increased noticeably. On almost everything. The increases are not small. The government claims food prices have increased by only 4%. But government spokesmen are obviously not housewives.

Margaret Thatcher would often ask her cabinet ministers if they knew the prices of specific grocery items. She always did. Because she took pride in her connection with British housewives.

You may notice that I have avoided the use of the word "inflation." Politicians and journalists (as well as certain popular encyclopedias) lazily use the term to describe the increase in the cost of living -- food, being a very visible essential, is usually a common target.

Economists use the term differently. When the cost of food increases, it is a price increase, and it is often amalgamated with other costs to determine a "cost of living index."

"Inflation" is a different, but related, phenomenon. To a economist (or as I was taught in high school while the earth's crust was still cooling), inflation is the decline of purchasing power of a given currency over time. The cause of inflation is one of those topics that economists love to debate, but most agree that inflation (and its nasty twin deflation) are caused by an increase (or decrease respectively) in a nation's money supply.

Rising food prices are, thus, an effect of infection of inflation, not the cause. That is why politicians who talk about price contriols are essentially saying that boiling water can be described as cold if you use a broken thermometer.

No one will dispute, though, that buying a bag of groceries this year on the Costalegre will cost far more than it did last year. Certainly more than 4%. I talked with two grocers who have increased their prices up to 40% on some items -- especially those that are imported.

A perfect example is the chicken dinner in the photograph. One of my favorite meals in Mexico is grilled chicken -- with all of the trimmings imaginable.

When I moved here in 2009, the price of a full chicken meal could be had for 100 pesos. Over the years, the price has edged up as Mexico experienced moderate price increases.

I have a special order at my favorite chicken place. The woman who runs it sees me coming and starts bagging up my full (rather than cut-up) bird. And because I stop by often, on my last visit, I had my pesos in hand for the dinner -- along with a healthy tip.

For some reason, I asked her the price. I hope I did not look too shocked as I quickly dug in my pocket for another peso note simply to pay for the chicken. This week's price was 180 pesos. It is still a great deal, but the increase reflects the price increases I have seen at the butcher shops.

Some of the increases have been caused by the international supply-chain problems. But even locally-grown products are just as expensive. Because that is how the market system works. Prices are set by supply and demand. Unfortunately, once prices ratchet up, they seldom ratchet back down.

Now and then, I run into people who claim the prime reason they moved to Mexico was to save money. I do not quite understand the argument, but I have no reason to dishonor another person's reason for living here. After all, most people did move here in the hopes of encountering nearly-insurmountable problems each day. That is my narrative. 

Are the price increases onerous? To my neighbors they are. Stretching the budget was difficult for most of the Mexican families I know before this recent round of price increases. And there will be some tourists who will feel a similar budget crunch.

If you have come to Mexico to save money, I am willing to bet it will still be a relative bargain compared to your homeland. The current inflation rate and price increases in Canada and America are not comforting.

But Schadenfreude is not the most likeable character trait.

No matter how much it costs.