As Inflation Rises, Prepare for Crime | SchiffGold
Inflation breeds desperation, and desperation breeds crime.
As central banks in Europe and Canada cut interest rates, and expectations remain that the Fed will wait to cut until at least September if it cuts this year at all, our endlessly-wise global central bankers, the benevolent all-knowing stewards of the global economy, can’t seem to agree on what steps are needed to cool inflation back down to reasonable levels.
But with no hope of ever setting interest rates truly high enough to properly tame price increases and stop the debasement of their ever-depreciating fiat currencies, inflation is set to keep ripping upward no matter what they decide. And when an increasing number of people can’t afford basic necessities, it isn’t rocket science (and doesn’t require a PhD in economics) to figure out what comes next.
From the early 90s to 2022, crime drastically decreased — something that police chiefs, political candidates, and the FBI love to boast about. But the real picture is quite a bit more complex. For example, while the US murder rate in 2020 was still much lower than it was in the early 90s, murder also saw its most dramatic single-year increase ever recorded in that same year. It isn’t hard to see how during the pandemic response — which turned the world into a fishbowl of terror, isolation, confusion, upheaval, and chaos — murders skyrocketed.
While the pandemic was a unique Black Swan event, and the murder rate has normalized and come back down since that very murderous year, economic crises lead to similar conditions of desperation, loneliness, and general despondence. Currently, most forms of violent crime are down in the US in comparison. But from 2019-2023, for example, car thefts rose by an astonishing 28.5%.
In 2022, instead of declining after the smoke had cleared from COVID lockdowns (and the “stimulus” checks had all been spent), property crimes like larceny and car theft went up almost 7%.
U.S. Property Crime Rates 2005-2022
Data Source: Federal Bureau of Investigation, compiled by USA Facts
During that same period (2020-2022), the official CPI numbers from the Bureau of Labor Statistics saw inflation go from about 1.4% to 6.5%. The average inflation in 2020 was reported as 1.2%, and in 2022, the average was 8%. While correlation alone doesn’t prove causation, it seems logically silly to think there’s no connection between rising crime and rising prices for basic needs and a higher resale value for stolen goods.
Plus, those crime numbers only count what was reported to the police. In addition to data coming from an incomplete set of participating law enforcement agencies, around 70% of property crimes are never reported to the police at all. A large number of crimes like larceny, petty theft, embezzling, and robbery don’t get called in for one reason or another.
Inflation doesn’t just increase crime because people are naturally more desperate when they can’t afford food and gas. It also makes certain types of crime, like theft of building materials and copper, more attractive. Car thieves can fetch higher prices for stolen auto parts, and jewelry thieves can get more cash for their loot. The list goes on.
Inflation incentivizes thieves to set their sights on materials that are part of important infrastructure, costing troubled towns and cities millions, disrupting real estate projects, and threatening the functioning of basic services that are dependent on cell towers, car chargers, and electrical station equipment.
As central banks scramble to contain a monster of their own making, shifting numbers on computer screens that move and shake the real lives of actual people, expect the bankers to fail — and expect crime to increase as one of many unfortunate real-world results.
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