Voters: Beware magical thinking
| October 27, 2022 12:00 AM
Republican ads routinely claim that inflation is Democrats’ fault: vote Republican and inflation will disappear. Inflation is a serious problem for us all, so let’s take a closer look.
First, inflation in September – bad as it was – ran 22% higher in Europe than here, and was only slightly lower in Canada, Australia, and New Zealand. If Republicans are correct, how did Democratic policies cause inflation everywhere else?
Assuming that Democrats cause inflation everywhere else is magical thinking. In truth, as economists know, our current inflation is a worldwide phenomenon caused primarily by lingering supply chain issues.
And what solutions do Republican’s offer? Increased production of fossil fuels? Putting aside the damage more carbon emissions will do to our children, more drilling only increases supplies a few years into the future, after inflation will long since have declined. And because oil is traded internationally its price is insensitive to production amounts here.
Republicans call for lower taxes (who could be against that?). But inflation is caused by too much money chasing too few goods. Even ignoring the fact that Republican tax reductions invariably benefit primarily the wealthiest, tax reductions are more likely to exacerbate than cool inflation. And few candidates pushing lower taxes tell voters what services will have to be cut as a result.
Voters: be wary of candidates who misconceive problems and offer for solutions only magical thinking.