Opinion: Every time I think the inflation discourse can’t get dumber, I’m proven wrong
By Catherine Rampell
Corporate greed. The cancellation of an oil pipeline that didn’t yet exist. A secret plot to cancel Halloween.
Every time I think the inflation discourse can’t get dumber, I’m proven wrong.
To be fair: The forces behind inflation, like many economic problems, are complicated. Economists can’t fully explain what determines current pricing behavior and inflation expectations in the real world, much less precisely predict where prices will land in a few months. New waves in the pandemic aren’t helping, either.
Most inflation predictions that top forecasters made in the spring turned out to be much too low. Elite academic economists, when surveyed about the risks of prolonged inflation, candidly acknowledge a lot of uncertainty.
All of which means there’s a lot of room for reasonable error on this issue, even among experts. But lately partisan factions have concocted new, unreasonable sources of error, too. Some of this rhetoric has been impressively creative; it’s basically like inflation fan fiction.
The left, for instance, has been demagoguing about how “corporate greed” is responsible for high inflation — implying that corporations have only just remembered they’re supposed to be greedy after having been very altruistic for several decades, and especially last year. (Inflation was super-low by historical standards in early 2020.)
The right, meanwhile, has been spinning its own increasingly ludicrous tall tales about inflation. That’s because Republicans see high inflation as valuable political fodder heading into the midterms.
“This is a gold mine for us,” as Sen. Rick Scott (R-Fla.) recently put it.
As Scott presumably knows, presidents have extremely limited power to affect prices, especially prices set by global markets (as is the case for, say, oil). But voters don’t really understand this, and many are eager to blame the president whenever they’re unhappy about the rising costs for gas or groceries. The GOP has decided it should take advantage. Strategists are working overtime to exploit voters’ economic ignorance by proposing ways that Democrats might have swelled prices.
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