Wednesday Wisdom 2/18

Midweek reads full of fun facts to contemplate on inflation, tariffs, healthcare, and my birthday

Feb 18, 2026

In Big News, I review the latest on consumer price inflation and share my outlook. The article round-up includes pieces on who’s paying for tariffs, disturbing demands from the Heritage Foundation, and how to be a helper in this strange American era.

Digital image, bathed in SRR Consulting purple, of a desk near corner windows at sunrise. On the desk is an open laptop, newspaper, and coffee mug with the Sara's Fun Facts skyline. — The laptop shows a scene from One Last Thing (*Sally O’Malley*).

Big News

The BLS Consumer Price Index Summary for January 2026 shows a continued downward trend in annual inflation, which is where the media narrative has focused. And why not? It sounds good. We could use some good news.

Good news: The Fed hiked interest rates and tamed inflation from a peak of 9.0 percent in June 2022 to 2.4 percent year-over-year in January 2026.

After rapid monetary policy actions to bring down inflation in 2023/2024, however, there was an election and the new administration’s policies are pushing inflation higher. Price increases for food, utilities, medical services, and household goods have accelerated since the summer of 2025.

Bad news: Two months — October and November 2025 — of detailed prices by category are missing due to the unprecedented action of freezing federal statistical agency operations during a government shutdown.

We can still see the upward trend in aggregate CPI inflation for all items and core (aka less food and energy). The charts below show the annual CPI trend (left) and monthly trend (right) smoothed to a three-month moving average.

Monthly inflation numbers are smaller, but a trend in the 0.15 to 0.20 percent range yields annual inflation at the Fed’s two percent target. Both the overall and core measures of inflation are trending at a 2.9 percent annualized pace over the last three months.

SRR Consulting line charts. The left shows the five-year trailing year-over-year CPI inflation for all items and core. The right shows monthly inflation on a rolling three-month basis for the past eighteen months. — Click each chart to enlarge.

So what? Inflation will not be tamed in 2026.

Tariff impacts are still filtering consumer prices. From the article round-up below, we know than U.S.-based businesses and consumers are paying most of the tariffs and $3.5 billion of customs bonds for 2025 have not been paid, leaving those goods stuck in port-adjacent warehouses. Beyond tariffs, immigration policy is shrinking the labor force, in some industries, such as medical services, construction, and agriculture, more than others. Shortages also increase prices.

Reads Around the Web

Who Is Paying for the 2025 U.S. Tariffs?, by Mary Amiti et.al., Federal Reserve Bank of New York, February 12, 2026: ”Over the course of 2025, the average tariff rate on U.S. imports increased from 2.6 to 13 percent… using import data through November 2025. We find that nearly 90 percent of the tariffs’ economic burden fell on U.S. firms and consumers… our results imply that U.S. import prices for goods subject to the average tariff increased by 11 percent more than those for goods not subject to tariffs.” [emphasis mine]
Trump tariffs leave importers with record-breaking $3.5 billion U.S. Customs bond funding shortfall, by Lori Ann LaRocco, CNBC, February 12, 2026: “customs bond insufficiencies reached a total of 27,479 in fiscal 2025, with the combined value soaring to almost $3.6 billion… the highest number of bond insufficiencies and the highest total value across insufficiencies ever recorded… with some tariffs increasing from 10%-25% or more for certain products, importers are facing customs bond amounts that now range from the minimum bond amount by regulation of $50,000 to as high as $450 million.”
Makers Are Building Back Against ICE, by Boone Ashworth, WIRED, February 16, 2026: “maker spaces are community centers or warehouse spaces that contain workbenches, 3D printers, laser engravers, power tools, and just about anything somebody might need to build whatever project—digital or analog—they have in mind… also serving as venues for fix-it clinics where folks can get help repairing the damages that occur as people’s tech is broken during protests or after federal agents break doors down while bursting into people’s homes… crafters and makers are preparing for the worst without sacrificing what makes them human.”