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Elsewhere, Texas Governor Rick Perry announced what he called his "1-1-1" plan:
“Every American gets 1 percent tax, 1 mandatory vaccination, and 1 execution.”
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From the article, Ron Paul says, “And it’s the only plan being offered that tries to reign in the Federal Reserve and get inflation under control.” Anybody know what inflation problem he is talking about?
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"reign in"? Good heavens.
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Inflation fears maybe.
Those "fears" have been around since the economy "turned around" two years ago or whenevr the Fed claims it turned around.
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Well, the structural fear of inflation now is more severe, because the interest rates have been synthetically held VERY low for a long time. Since we ARE in an inflationary environment, it's just inflation of prices, not wages (much). Net wages are still dropping in this country, but net prices are increasing.
I remember the early 80's, and how.. difficult it was. I was just starting out then, and man... it was difficult. 18% mortgage, anyone ?
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Inflation is real, it's just disguised a bit more cleverly and thus never hits to books. A country cannot go through a fuel increase of the sort we have without trickle up effects.
A typical food basket today (adjusted for both inflation and packaging shrinkage)
University of Southern California analysis
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RgrF wrote:
Inflation is real, it's just disguised a bit more cleverly and thus never hits to books. A country cannot go through a fuel increase of the sort we have without trickle up effects.
A typical food basket today (adjusted for both inflation and packaging shrinkage)
University of Southern California analysis
That graph does not appear to be based on actual data for an actual period of time, much less the present - it seems to be a generic hypothetical made up to show that inflation fluctuates and that there is an upward trend line in inflation over time. But even in low inflation times the inflation rate fluctuates and goes up over time. Even though the general trend is for the value of the dollar to depreciate - which has been the general trend for a couple of centuries - that does not imply that inflation is a problem now.
In the year before the last presidential election (spanning Nov. 2007 to Oct. 2008) the average inflation rate was 4.3%. It went to over 5% in June, July and Aug of 2008, but I don't recall inflation being mentioned as a big problem. The inflation rate is 3.8% now and we are in the middle of the worst recession since the great depression and yet we are being asked to accept that we simply must do something about inflation now. I don't buy it.
I do grant that increasing oil costs is a problem. But it is going to be a problem no matter what the state of the economy is. There simply is more demand than supply. Economic conservatives seem to think that we can deal with this problem by drilling more, but more drilling can only mitigate the problem a little bit at the periphery. We are at the point where if we keep trying to do things much the same way as we have for the last few decades that the demand for oil will always be greater than the supply and the costs will escalate. So the solution is ultimately going to have to involve having less demand for oil. Now we can have less demand if we tank the economy by having the fed raise interest rates because we are afraid inflation may be a problem. Or we can use oil more efficiently and switch to alternate energy sources. We could borrow money at an extremely low interest rate (interesting how low interest rates are for federal borrowing even though so many people are convinced that inflation is about to take off) and invest in using energy more efficiently and developing alternative energy sources. That would put people back to work now and strengthen the infrastructure for the future. Instead we are being bombarded with the notion that the federal government must go into an austerity routine that will make unemployment worse now AND we are told that even though inflation isn't that bad now that the fed must act to keep in it check - even though that would also make unemployment worse now and would do next to nothing to address the supply/demand problem with oil over the long run. Guess which alternative most economic elites favor.
