kalm wrote: ↑Mon Nov 27, 2023 4:36 pm
UNI88 wrote: ↑Mon Nov 27, 2023 11:25 am
So are recessions. If we search your posts will we find that you gave Dubya as much grace for the 2008 recession?
Inflation, recessions, etc. happen but fiscal and monetary policy can alleviate or exacerbate the ups and downs. The oxymoronic Inflation Reduction Act exasperated a problem a blind man could see coming.
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And the New Deal and Interstate Highway Plan put us in a hole we never climbed out of.
Did the IRA cause inflation in rent or real estate? How about college tuition and healthcare costs?
And since you’re feeling conkish today, that blame is shared across both parties and obviously multiple administrations.
OMG, stop being so obtuse. This was the clearest case of government-induced inflation maybe ever.
To recap again - we were coming out of COVID and the significant government-induced cessation of parts of the economy. The economy was looking pretty good and things were sorting themselves out. Government decided that people liked getting something (i.e. money, benefits) for nothing and wanted to keep doing that. First, Trump, during his lame duck period when he wasn't calculating how to defy the Constitution, thought an unnecessary COVID relief package would be a good thing. We didn't need it, but people weren't going to turn down the largesse from the government. After Biden took office, he didn't want Trump to take any credit for relieving us of the burden of COVID, so he came up with a significantly bigger COVID relief package about four months later. Mind you, contemporary economists were already criticizing the earlier, smaller Trump bill as being wholly unnecessary and potentially inflationary as the economy was already recovering well. Alarm bells starting going off during Biden's push to get even more government money out to the populace as the economy was clearly recovered and now needed people back to work (a portion of this COVID relief bill carried unemployment benefits out through the summer, multiple months later). Economists were warning of significant inflation that could be the result of this huge increase in the money supply. Coupled with all of this, was the Fed, completely asleep at the wheel and continuing the way-too-long period of easy money by keeping interest rates at near record lows. In the face of rising inflation, which the Biden team brushed off as "transitory", Biden kept pushing even more government spending. The urge to forgive student debt (with no plan on how to stop future student debt) kept being pushed to the forefront, and then to push further government spending through we had to call it "inflation reduction" even though it did the exact opposite.
Inflation has receded over the past several months simply because we've stopped tremendously increasing the government spending that was the precipitating factor in that inflation. As inflation has tempered, businesses and investors are more able to accurately predict where the economy will be several months down the road and, knowing better where costs will be, have quieted down price increases that were a secondary factor extending inflation after the initial government-induced surge. Of course, there are and will always be nefarious profit seekers who take advantage of periods of rampant inflation, but again, don't leave the barn doors wide open and those horses don't get out of the barn in the first place. We're in the aftermath now of the reckless inflation, where the average American is now worse off than they were before - real incomes since Biden took office are still lower than they were before he took office, and that's almost entirely due to his historically bad management of inflation.
kalmie likes to bring up anything to distract attention from the very real and obvious immediate causes of the rampant inflation we saw in the 2021-2023 period, but they are red herrings. Inflation is always a money supply problem, and the causes of the increased money supply were very clearly rampant, excessive government spending, a little under Trump, and then mostly under Biden, coupled with an inattentive Fed that bungled interest rate management through this. Blaming Bush or Clinton, or even Reagan, for the most recent inflationary period is ignorance at best, and intentionally dishonest at worst. I prefer to think kalmie (and houndy) are the former - I'd hate to think they're intentionally the latter.
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