Brace Yourself
If stagflation is back, we can expect to see crackpot economics to go with it:
Price increases will be attributed to greed. (I didn't know businessmen were so generous in the 1980s and 1990s.)
Price increases in exported goods will be blamed on perfidious foreigners buying them up.
Price increases in goods in the domestic economy will be blamed on immigrants.
Price increases in imported goods will be attributed to either evil foreigners we must declare war on or oppressed peoples we must be especially nice to so they will give us discounts. (Both sides in this controversy will claim anybody who disagrees with them is in cahoots with the other bunch of crackpots.)
The Malthusians will claim high commodities prices prove they were right after all. They will also claim unemployment is due to population growth outrunning job growth. (Isn't it amazing how they only seem to be right immediately after lots of funny money has been printed?)
Some conservatives will blame unemployment on people not wanting to work.
Space advocates will claim space materials will relieve commodity shortages and thus stagflation in general.
3 Comments:
No one will blame unemployment on the fact that people are paid to not work.
You forgot the dumbest and most pernicious crackpot theories, such as the "natural rate of unemployment," or NAIRU, by which it is claimed that people are unemployed because wages are too low, unemployment benefits too high and unions too powerful.
Of course, in reality, unemployment is caused by a deficiency of demand, and can be solved by the simple expedient of unrestricted fiscal defense of full employment.
(No, this would not be inflationary, and even if it were inflationary, inflation is not a bad thing.)
- Jake
Bah, should learn to proofread. The NAIRU nonsense claims that wages are too high, of course. It was, after all, developed by intellectual prostitutes, who come to the conclusions that pay best for them.
- Jake
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