Media Crib Notes On Inflation From Jen Psaki - FAIL Economics

P. Gardner Goldsmith | October 24, 2021

"Inflation" is not what US Press Secretary Jen Psaki and many – or most – politicians and reporters appear to think that it is.

Even if one were to work on the periphery of economics, some fundamental and unchangeable facts come to the fore.

The first is that valuation is subjective, implying that any outside mandate on market choices of others is not only unethical, it is economically unworkable.

The second is that resource information is dispersed, and utilization of information for markets must be left up to individuals who apply their own valuations by engaging in voluntary exchanges, adjusting prices based on demand and supply, and driving conservation and productivity -- all, leading to lower prices and greater prosperity for vast numbers of people.

The third is that, like the observation that value is subjective; the medium of exchange that one offers, or accepts, is something that should not be dictated to us by politicians. Each person must be free to decide for himself if a medium of exchange is worth his or her use. By doing so, the money gets market-tested, and is allowed to be revealed by users as valuable and long-lasting.

The fourth is that any connection of politics to that medium of exchange is unethical, tyrannical, anti-economic, and disastrous, always leading to inflation.

We often are told – with schoolmarm haughtiness, in the case of Psaki  – that inflation is a "price increase" in a government-listed set of consumer goods, the implication being that the prices have risen due to increased demand or decreased supply.

That is not inflation.

Inflation is an artificial increase in the money supply – be it created by a government or a central bank cartel given a monopoly on the issuance of money.

This increase in the money supply leads to the higher prices that the politicians and media ignoramuses CALL inflation. Those more numerous units of money bid up prices, or, to offer the reciprocal, the increased money supply pushes DOWN the buying power of each unit of money chasing the goods. As a result, since the creation of the Federal reserve in 1913, the buying power of the US Dollar has been weakened by an average 2.5 percent, compounded, each year.

And not only does Jen Psaki exhibit elitist dismissal of this fact, there seems to be a concerted effort in Biden-friendly pop media to fool Americans about it.

Recently appearing on with Jake Tapper on CNN’s “The Lead”, Psaki ascribed the problem of higher prices to a fantastical notion that employment was skyrocketing and leading to higher consumer spending.

As Pam Key reports for Breitbart, Tapper said:

Inflation is skyrocketing as I don’t need to tell you. The prices for home heating costs, cars, groceries, furniture, rent, gasoline are hitting Americans right in the wallet. The White House response has been generally to say, ‘Hey, inflation shows we’re coming out of the recession. It’s a good sign.'

To which Psaki responded, in part:

People weren’t buying goods because they didn’t have jobs. Now more people have jobs. More people are buying goods. That’s increasing the demand. That’s a good thing.

Which misses the mark on employment and indicates a profound lack of understanding about supply, demand, and price increases caused by inflation.

Next time he welcomes Psaki to spout such nonsense, perhaps Jake Tapper will exhibit the fairness to invite a guest such as California Assembly member Laurie Davies, who correctly noted for The Press-Telegram that, on the jobs front:

Under the Biden administration, the U.S. has lost 180,000 workers in September, women have lost 26,000 jobs last month, and September marks the second consecutive month with less than half of the expected jobs added to the economy. The one statistic President Biden touted, that unemployment is down from 5.2% to 4.8%, is even a farce. The Hill reports that ‘the steep decline is largely due to millions of jobless workers remaining on the sidelines.’ Yet President Biden calls it steady progress?

And then there is the “stay home” lucre that the feds have showered on the population:

Many small business owners have been struggling to replace employees that were laid off during the pandemic. Hostile working conditions coupled with unemployment benefits that continuously roll in, provide little incentive to get people back to work.

And a close look at that “we politicians can’t tax enough to redirect all this cash to people, politically favored businesses, state governments, and to federal employees, so we’ll borrow it from the Federal Reserve” mindset directly leads us to the inflation and price-increase problem. It’s a problem that has plagued the US since the creation of the central bank – and that means not only the Federal Reserve, but also the earliest US government banks pushed by conniver Alexander Hamilton, all of which led to massive inflation of the money supply, just like we suffer, today.

More recently, one can look at the $16.8 TRILLION “TARP” (Troubled Asset Relief Program) bailout of late 2008, into 2009, the tragically-titled $840 BILLION Obama-era “American Recovery and Reinvestment Act”, the $2-PLUS TRILLION Trumpian CARES Act, the additional $104 BILLION in additional “caring” Trump and Congress inflicted on us, and the $2 TRILLION Biden “American Whatever” Act (actually titled “American Rescue Plan,” as if that’s not a bleak joke) he, the Dems, and the RINOs passed earlier this year, not to mention all the other profligate spending the feds typically do every danged budget cycle – ya know, to fund extrajudicial drone strikes and unconstitutional viral research and jab creation.

The US government could not tax us enough for that, so it floated bonds, bonds that that the Federal Reserve invented money to buy, and bonds which future generations will be forced into tax slavery to pay off. And as the latest phase of money-creation ratcheted up, circa 2008, even folks in Russia and China recognized that the buying power of the Dollar was going to die, so they dropped large shares of their long-term US debt instruments and avoided acquiring more, opting, instead, to acquire hedges against inflation: the hard-to-inflate gold and silver.

If politicians are prompting the Fed to create TRILLIONS – just over the course of the past year, alone – even as they pay people to stay out of the workforce and screw up the supply chain, thus increasing costs for employers and consumers, the inflation of the money supply will lead to higher prices, and those higher prices will be made WORE by shortages in labor as well as shortages in the materials and services the labor would provide. This is self-evident, stemming from a fundamental understanding of supply and demand, and some free market writers on economics (this writer, included) predicted that this would happen.

Yet Psaki thinks this is a manifestation of “a good thing,” and leftist Bloomberg recently published a completely nonsensical, narrative-backing piece by Karl W. Smith calling for HIGHER inflation, because, in part, he claims it would make personal debt “easier to manage,” and it would allow the Fed and politicians to offer “stimulus.”

And Biden's Chief of Staff, Ron Klain, re-Tweets a claim that skyrocketing prices and supply chain breakdowns are "high class problems."

And Psaki snarks about shortages being "the tragedy of the treadmill delayed."

And The Washington Post publishes a piece by collectivist Micheline Maynard telling struggling Americans that they have been pampered and need to have "more realistic expectations."

Gaslighting epitomized. These aggressors push policies that directly and indirectly harm people's lives and livelihoods, then pose as the innocent victims when the REAL victims criticize them and sound alarms!

I don’t need to write a lot more. You get it.

Politicians like these have been gaslighting people, hard, ever since government claimed the power to tell us what money we can use, and Jen Psaki and her pals haven't the foggiest notion what the inflation-havoc has wrought and the hardship all their meddling will bring.


Related: Sen. Manchin: 'No One Is Talking About Inflation or Debt, and We Should Have That As Part of the Discussion' | MRCTV