12 November 2021

Inflation is being greatly exaggerated in its import

I make no pretense of being an economist, but it seems really obvious to me regarding the current roughly 6% rate of inflation:

  1. It is skewed. Meat, some imported goods, autos (including used autos) and several other sectors are at a high rate, but most services are little affected.
  2. It's primarily driven by shifts in the economy related to COVID which have spiked demand. Thus it is not actually a sign of weakness in the economy, and will likely work itself out in a year or two, with some things that are driven by global trade slowdowns also caused by high demand taking longer to work out.
  3. Unemployment is virtually nonexistent, which means wages are rising, too, making inflation much less of a worry. Inflation actually indicates that demand is high, people have money, and the economy has foundational strength. Very unlike the recession that followed the Financial Crisis of 2007-2009.
In my opinion, the continuing political crisis caused by massive disinformation and one party doing literally everything it can to terminate the small-r republican principles that are supposed to underly our system of government (i.e., majoritarian representation, as opposed to oligarchy), is far more of a concern than the economy right now. Democrats need to get a whole lot better at conveying the message that they're the ones who stand for stability, fairness, and the kind of balanced government support that we used to have in this country from roughly 1932-1980, while the Republicans stand for corporatist and super-rich power over representative government that takes the views of the majority into account. In comparison, the relatively minor economic disruption caused by the pandemic pales.

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