Joe Biden has a new explanation for inflation

Joe Biden has a new explanation for inflation:

He was massively ratioed on Twitter for being an ignoramus. It was so bad even Jeff Bezos weighed in and it wasn't pretty:

Shortly before that, Biden was blaming oil companies for high inflation in the economy, which clocked in at 8.3% in April on a CPI basis over the year earlier. Produce prices, a measure of price hikes coming down the pike, have gone even higher, at 11%.

According to PJMedia:

“Oil and gas companies shouldn’t pad their profits at the expense of hardworking Americans,” Biden said in a tweet in March.

“While families are struggling to pay higher prices at the pump, oil and gas companies are recording record profits,” House Speaker Pelosi claimed earlier this month.

And according to Matt Margolies at PJMedia:

In the course of a year, we’ve gone from “inflation will be transitory,” to “inflation is a good thing,” to “inflation started under Trump,” to “it’s Putin’s price hike.” Polls show that no one was buying the blame-Putin strategy, so Biden and the Democrats are now accusing oil companies of price gouging.

Well, now it's companies not being taxed enough, or companies taking advantage of tax loopholes, which have been in place since Joe occupied the Senate and had the power to do something about it -- and didn't.

In any case, it's junk economics. Brian Wesbury, a prominent economist explained where inflation comes from:

That basically explains economist Milton Friedman's most important statement, that inflation is "always and everywhere a monetary phenomenon..." It's not oil. It's not Putin. It sure as heck isn't the tax rate in an economy that has had those tax rates for years. 

Here are a few useful real-world economics responses to that tweet that got Biden skewered:

Inflation can be cured in two ways -- through interest rate hikes, which the Fed has begun to do, or huge tax hikes -- which would drain the excess money out of the system, but the government would not be allowed to spend it. Does anybody think Joe's got that kind of restraint for that one?

In reality, with this much daily shape-shifting on inflation, Biden makes Jerry Ford and his "Whip Inflation Now" program look useful. At least Ford stuck to his story, as errant as he was in his analysis that if people bought fewer goods at higher prices, the problem would end.

Biden isn't doing anything like that. The rapid-flipping answers he's putting out suggest that he has no idea where inflation comes from. Worse still, he's no longer even trying to find out.  

Image: Marco Verch Professional Photographer, via Flickr // CC BY 2.0

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