Palin Responds to Real Time Economics and We RespondPalin: So, imagine my dismay when I read an article by Sudeep Reddy in today’s Wall Street Journal criticizing the fact that I mentioned inflation in my comments about QE2 in a speech this morning before a trade-association. Here’s what I said: “everyone who ever goes out shopping for groceries knows that prices have risen significantly over the past year or so. Pump priming would push them even higher.”
Mr. Reddy takes aim at this. He writes: “Grocery prices haven’t risen all that significantly, in fact.”
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Now I realize I’m just a former governor and current housewife from Alaska, but even humble folks like me can read the newspaper. I’m surprised a prestigious reporter for the Wall Street Journal doesn’t.
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WSJ: The Nov. 4 Wall Street Journal article noted, in its first sentence, “the tamest year of food pricing in nearly two decades.” It does indeed report that supermarkets and restaurants are facing cost pressures that could push their retail prices higher — but it hasn’t happened yet on a large scale.
If anyone had any doubts that the half-term Governor of Alaska is preparing for a Presidential bid I think this should put them to rest. Does anyone really think she understands the things she is talking about? This seems to be part of a recent PR effort by the right. For example see this recent Media Matters piece:
Glenn Beck might not know what the word "deflation" means. The PR push consists of classic GOP techniques and themes.
1) Anti-Intellectualism
Those point headed types are just so dumb, with all their facts and knowledge and stuff. Us humble average folks can easily see they are wrong.
The issue at hand is the Fed's QE2 program that they are undertaking to battle disinflation and deflation. One can argue about whether it will work or not , but the reality of disinflation (the inflation rate getting smaller and smaller heading toward deflation) is a factual question.
2) Muddy the facts
That we are experiencing disinflation is undeniably true. Inflation rates are at or near historical lows both in measures of core inflation and for food specifically (as the WSJ article points out). While it is true that food prices are increasing more than others
this has always been true and has nothing to do with the overall trend of disinflation. Whether core inflation is high or low food inflation will be slightly higher.
3) Faux and/or misguided populism
So, the take away is supposed to be that those pointy headed types just don't get ordinary people's concerns and are pursuing policies that hurt the average Joe. But, as we've seen, what they are pointing to has nothing to do with any particular Fed policy. This is misguided because, should we choose to ignore disinflation and deflation, the economy will shrink. This means that many of these average Joes will not have money or a job to buy the oh so low priced food.
4) Waving the bloody shirt of stagflation
That was a phrase Paul Krugman used recently to describe how the right uses the stagflation of the 1970's to argue against any and all policies enacted under liberals. Certain liberal policies led in the past to a stagnant economy with rising inflation. And, as we all know, something that was true once under one set of circumstances is always true in all circumstances :sarcasm:. I see this both as a defensive and offensive measure. On the offense it resonates with a 30 year old attack on any and all liberal policies... "INFLATION! BOO! AHHHHHH!" And also it is a defense of those past attacks since the data right now isn't cooperating. "Well, see, our claims of liberal inflation really are true. It is just that those pointy heads haven't bothered to look at food prices."
5) Party of No!
The final theme is the most common one. "We oppose anything and everything that happens under Obama."
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