Without saying who is to blame, we do know that the enabler in the subprime disaster has been the Federal Reserve Board and former chairman Alan Greenspan. Now his successor, Ben Bernanke, may make the mess even worse.

Greenspan supplied the air for the housing bubble by helping to make money so cheap and available that bankers were skulking around shopping malls sticking knives in people's ribs until they agreed to sign up for a loan they could not afford to repay.

Besides having created the mortgage-liquidity nightmare, Greenspan and the Fed can also chalk up another accomplishment: inflation. Inflation is so serious that it has more than wiped out any income gains coming to the majority of families in the past seven years.

The New York Times reports that "Americans earned a smaller average income in 2005 than in 2000, the fifth consecutive year that they had to make ends meet with less money than at the peak of the last economic expansion, new government data shows. While incomes have been on the rise since 2002, the average income in 2005 was $55,238, still nearly 1 percent less than the $55,714 in 2000, after adjusting for inflation, analysis of new tax statistics show."

In fact, the inflation damage for most families is worse than these average numbers suggest, since, as the Times says, "the growth in total incomes was concentrated among those making more than $1 million. The number of such taxpayers grew by more than 26 percent, to 303,817 in 2005, from 239,685 in 2000. These individuals, who constitute less than a quarter of 1 percent of all taxpayers, reaped almost 47 percent of the total income gains in 2005, compared with 2000."

For any individual or family, such figures translate into harsh facts at the checkout counter. Just in the last year the price of oranges and eggs has risen almost 20 percent. Milk is up more than 13 percent, chicken 10 percent, even potatoes are up more than 5 percent.

The McClatchy newspapers, where readers often get information others do not print, reports this alarming development: "The Labor Department's most recent inflation data showed that U.S. food prices rose by 4.2 percent for the 12 months ending in July, but a deeper look at the numbers reveals that the price of milk, eggs and other essentials in the American diet are actually rising by double digits. Already stung by a two-year rise in gasoline prices, American consumers now face sharply higher prices for foods they can't do without. This little-known fact may go a long way to explaining why, despite healthy job statistics, Americans remain glum about the economy."

The richer you are or the more strategically placed you are, the less you will be hurt by inflation. Members of Congress and many other high federal government personages have built cost-of-living adjustments into their pay packages; Social Security recipients have COLAs that are never bestowed on most working people so that even when they get raises they do not, as the numbers show, catch up with what inflation has already taken from them.

With a bit of luck inflation may help you. Homeowners with mortgages get a break because the money they are using to pay back their loans is worth less every year. That may not be of assistance to some people--those trapped in subprime loans, for example--who may have taken out mortgages they cannot afford.

For those of you with ever larger bills to pay with an ever smaller dollar, there is little relief in the offing. Bernanke and his Fed are under enormous pressure from the big guys to put yet more money in circulation to help the large financial institutions and distressed hedge funds get through the subprime crisis of their own making.

Thus they want him to lower interest rates, which will bring on more inflation and higher orange juice prices. But do not despair. Even during inflation some prices go down, thanks to a glut of one kind or another.

So with the news that Afghanistan has come through with a bumper opium crop, all you heroin junkies should soon be enjoying your favorite substance at less cost per toot. If you drink milk, you're outta luck.

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