Does Taming Inflation Necessarily Bring Unemployment?
Reader Robin forwarded short piece in Axios Macro entitled “Powell Pain - “This is gonna hurt.” It analyzed and attempted to predict the effects of Jerome Powell, head of the Federal Reserve Board, continuing to raise interest rates, lately by 3/4 of a percent (75 basis points)—and signaling more prime rate hikes to come. She asks three questions:
- Should the Fed acted faster?
- Is it acting in a meaningful way; and
- Will raising interest rates equally share the burden among different U.S. classes/interest groups?
- banned additional oil leases on federal land, canceled Keystone XL, and almost instantly turned us from net energy exporter to an importer, thus exposing us to the inflationary shocks of world oil prices. BIDEN DID THIS DELIBERATELY.
- Biden mandated higher CAFE standards, and outright moves to electric cars—when Europe now is proving wind is worthless (viable, DC not AC like the grid, so you have to waste power on alternators or flywheels); and it would take solar panels (I calculated a decade ago) the size of Wyoming even to make a dent in our needs (and solar, like wind both is variable and DC, not AC). BIDEN DID THIS DELIBERATELY.
- The shut down was a long time ago: inflation dropped in the last year of the Trump Administration.
- Bush’s saving of some, not all, Banks is close to the line, but was not inflationary—it prevented the inflation a bank run would have caused. Trump’s PPP loans were designed only to keep small businesses employing people—and by all accounts that worked. Again, the data show it wasn’t inflationary. Both programs were narrowly focused.
- The Inflation Reduction Act is nothing but pork spending to please constituents: unions, eggheads (“Biden forgave $10,000 in student loans. In unrelated news, colleges raised tuition by $10,000), and ridiculous non-petroleum energy subsidies. BIDEN DID THIS DELIBERATELY.
- If two Republican Administrations, and one Democratic Administration can get through 20 years with out inflation, the next, inflationary Administration IS DOING SOMETHING DELIBERATELY WRONG.