Tag: inflation

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Accountability folly national politics & policies political economy

Whip Producers Now

inflation, shock

The Biden administration is siccing agencies like the Federal Trade Commission, Department of Agriculture, and the Federal Maritime Commission onto the producers of stuff who have recently dared to raise prices.

Stuff like gas. Higher prices at the pump must be an oil-company conspiracy.

It has nothing to do with (and don’t even think it!) governmental actions that impede production, including shutting down the Keystone oil pipeline on Biden’s first day in office or calling a halt to new oil leases on public lands. Etcetera.

Nothing to do with mammoth expansion of the supply of money and credit to facilitate trillion-dollar government spending sprees.

In case you hadn’t noticed, meat costs more, too. So obviously that must be the fault of malicious meatpackers. Rest assured that beef price inflation is utterly unrelated to pandemic-policy-induced labor shortages and delays.

Or to any recent increase in efficiency-impairing trucking regulations.

Same with sundry supply-chain problems, like the ships and crates piling up at ports. Greater consumer demand, new pandemic-induced screening protocols, union rules that prevent ports from operating 24/7 or improving automation — all irrelevant.

Must be. That’s the script from 1600 Pennsylvania Avenue, anyway.

But if companies can hike prices at will, ignoring whether regulations ease or obstruct production, why doesn’t the meat industry, for example, charge a thousand dollars per pound of flesh?

Well, we know why. 

Demand for a pound of ground beef would slide to zero, or close to it.

If only the government people knew! 

Or would stop pretending they don’t know. 

A consistent recognition of the laws of economics would sure make a great gift — in any season. Instead of bullying and making things worse, government could get out of the way.

This is Common Sense. I’m Paul Jacob.

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deficits and debt folly national politics & policies responsibility

Biden Blames Business

inflation, cash, money, fire

Inflation’s up, and President Joseph Robinette Biden, Jr., thinks he knows why.

Economist Bruce Yandle, famed for his “Bootleggers and Baptists” theory of regulation, reports in Reason that the aging president blamed “the country’s three largest meatpackers” for contributing to July’s CPI rate of 5.4 percent, and the fuel industry for its part in August’s 5.3 percent annualized rate. 

Profiteering!

I’ve always wondered how anyone can get away with this tired old accusation. Businesspeople aim to profit at all times and in every place. Profit is why they go into business. Are they making too much inflation-adjusted profit during an inflationary period but not when inflation is low? Seems unlikely.

But Biden’s looking into it! “There’s lots of evidence that gas prices should be going down,” the prez claimed, “but they haven’t.”

What evidence? Biden presented none. 

After throwing so much money into the economy to “stimulate” it after the big hit commerce has taken from state-perpetrated lockdowns, what could we expect but rising prices? “Inflation is always and everywhere,” a great economist has said, “a monetary phenomenon.”

Bruce Yandle is on that same page. Referring to Mr. Biden’s bizarre blame game, Yandle suggested that maybe — just maybe — Biden “should look inside the halls of the West Wing.”

Specifically at all the spending, like the current “$3.5 trillion spending package.” The puppet masters pulling Biden’s strings must, Yandle asserts, “be aware that calling for more spending to calm inflation is like pouring gasoline on an already smoldering fire.”

The real problem is “too much printing-press money” backing deficit spending.

Blaming excess profits? A distraction.

A big lie.

This is Common Sense. I’m Paul Jacob.

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national politics & policies responsibility

The Accelerators

tax, spend, inflation, bankruptcy

“We can do $10 trillion,” declared Rep. Alexandria Ocasio-Cortez (D-NY) last week.

“I know that may be an eye-popping figure for some people,” explained the photogenic pop-eyed pol, “but we need to understand that we are in a devastating economic moment, millions of people in the Unites States are unemployed, we have a truly crippled health-care system and a planetary crisis on our hands, and we’re the wealthiest nation in the history of the world.”

In other words, the sky is falling . . . and we still have checks.

The Bronx congresswoman, described as “one of the most influential members” by MSNBC’s Rachel Maddow, trumpeted that tidy sum in response to last week’s “go big” proposal by President Joe Biden to spend a special new $2.2 trillion under the loose label of infrastructure, which AOC argued “is not nearly enough.”

This new two-tril spending bill is “a follow-up to the $1.9 trillion stimulus approved in March.” And just Part 1 of a two-package infrastructure and other stuff Biden plan. 

“The White House is reportedly willing to spend $4 trillion across the two packages,” Business Insider reports, “a sum that would bring recovery spending under his term to nearly $6 trillion.”

Biden’s term has been only 76 days.

A couple trillion here, a couple trillion there and pretty soon you’re talking real money . . . except under Modern Monetary Theory, which Ocasio-Cortez embraces. The idea being: government can print as much money as politicians want to spend. 

While this road to bankruptcy has been paved with the partisan political intentions of big spending politicians of both major parties, right now it is the Democrats hitting the gas.

This is Common Sense. I’m Paul Jacob.

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Accountability folly free trade & free markets general freedom moral hazard property rights responsibility too much government

Poison Is Poisonous

poison, inflation, Venezuela, socialism, free markets, capitalism

Venezuela’s socialist economy has been collapsing.

No big mystery. If, out of hostility to capitalism, a society keeps destroying everything that production, trade, and prosperity depend upon, the economy suffers. The benefits of markets don’t flow no matter what.

One assault has taken the form of hyperinflation — runaway printing of currency, done in part to dissolve government debt. Many Venezuelans are resorting to barter. It’s easy to understand why.

Or is it? A Reuters reporter says that economists say that “the central bank [of Venezuela] has not printed bills fast enough to keep up with inflation, which . . . reached an annual rate of almost 25,000 percent in May.”

So go faster!?

Dude. Dude. The massive expansion of Venezuela’s money supply is what’s causing massive jumps in prices. Just like any other economic good, the medium of exchange is subject to the laws of supply and demand.

Other things being equal, enormously increasing a supply of a good will enormously lower its market value or price. Money, too, has a price — in terms of the non-monetary goods being bought. If the pre-hyperinflation price of a dollar in terms of bread is one loaf and the post-hyperinflation price is one bread crumb, you won’t reverse the decline by printing even more dollars or bolívars even faster.

If you’re ingesting poison, you can’t fight the effects by being poisoned more and harder. The very first thing to do is stop ingesting the poison.

This is Common Sense. I’m Paul Jacob.

 

 

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Accountability folly ideological culture nannyism responsibility

Venezuela’s New Firing Squad

Maduro, Venezuela, socialism, collapse, illustration

We’ve watched Venezuela’s big-daddy socialism descend into dystopia:

  • Arbitrary arrests of political opponents;
  • An economy managed by government decree, in which inflation “may top 700 percent this year” and toilet paper, food and medicine are in terribly short supply;
  • The once oil-rich country has become “the worst performing economy in the world,” with hundreds of thousands of Venezuelans clogging border crossings with Colombia;
  • Meanwhile government workers “enjoy” a two-day work-week to save electricity, avoiding the wasted hours caused by daily blackouts;
  • And President Maduro has decreed that citizens can be conscripted — drafted into service — for 60 days, forced to pick crops.

“Venezuela brings back fedual [sic] serfdom to try to alleviate food shortages,” read one online headline. (Don’t laugh, that may be how we spell “feudal” someday.)

Still believing in magic . . . “Maduro ordered a 50 percent increase in the minimum wage last month,” informed the National Post, “but the latest studies show that salaries still fall far short of the amount needed to obtain basic household goods and food.”

Socialism has failed, again, and in doing so demonstrates something more than economic shortcomings. As the late President Ford warned, “A government big enough to give you everything you want is a government big enough to take everything you have.”

The Venezuelan people have the right to recall the president enshrined in their constitution, a particularly popular right at present . . . but the Maduro dictatorship refuses to take prompt, lawful action to facilitate the recall.

Not to mention unjustly arresting citizens circulating the recall petition or telling high government ministers to fire any government worker who signs.

So much for the socialist revolution . . . now tyrannically blocking a real revolution.

This is Common Sense. I’m Paul Jacob.     

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Maduro, Venezuela, socialism, collapse, illustration

 

Categories
folly nannyism national politics & policies

Doom Fails to Arrive on Schedule

DOOM

Doom is not always bad. I’d appreciate the doom of nonsensical doomsaying, for instance. . . although I doubt that that glorious day will dawn anytime soon.

Equally unlikely is an apology from ABC and Chris Cuomo for pitching, back in 2008, a muddled ABC special, “Earth 2100,” about all the disasters expected to arrive by 2015, among other years.

The idea? Forecast the harm inflicted by allegedly man-made global warming and collateral calamities, via the scientific methodology of being safely vague or just making stuff up. One way the network secured data was to ask viewers to pretend they’re in the future and then “report back.” (Well, it was 2008, a more primitive era. They did things like this back then.)

Here’s a sample of what ABC purveyed as possibly impending:

  • “Temperatures have hit dangerous levels.” (Time for air conditioning and/or heat!)
  • “We’ve got more people, less and less resources. That’s a recipe for disaster.” (Let markets be fully unfettered so we can be sure to get more and more instead!)
  • “It’s June 8, 2015. One carton of milk is $12.99.” (Unless that’s a big carton, no. Try $3 or $4 a gallon.)
  • “We’re going to see more floods, more droughts, more wildfires.” (Good work, Nostradamus!)

We still get storms. (Always had ’em; always will.) And inflationary Fed policy and other bad governance still swirl on the horizon. So let’s have shelter, fire departments, umbrellas, and market-friendlier policies; and let’s not reside on hurricane-prone beaches.

Thanks for the heads-up, Chris.

This is Common Sense. I’m Paul Jacob.

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DOOM