An elitist economist is insulting his readers by doubling down on the much-criticized notion that spiking inflation is only “transitory.”
Princeton University professor Alan Blinder penned an absurd Wall Street Journal op-ed headlined, “When It Comes to Inflation, I’m Still on Team Transitory.” Blinder even conceded in his subheadline that “transitory” apologist Federal Reserve Chairman Jerome Powell “may have retired the term,” but proceeded to claim that “bottlenecks and shortages should be over soon.”
This was the same Blinder who wrote an equally absurd March 15 op-ed headlined: “There’s No Need to Panic About a Little Inflation.” Another Blinder piece in July had the headline, “Don’t Worry Too Much About the Inflation Surge.”
In his latest take, Blinder scrambled to save his reputation on the matter. Even though the Consumer Price Index skyrocketed 6.8 percent in November for the fastest pace in 39 years, Blinder dismissed the measure by saying it “exaggerates the problem.” [Emphasis added.]
Instead, Blinder cherry-picked the year-over-year November core personal consumption expenditures (PCE) price index (4.7 percent), which excludes food and energy due to volatility, as the “better measure” that the Fed uses to gauge inflation. He used the core PCE price index statistic to misleadingly state, “So yes, we have an inflation problem. But 4.7% inflation is a smaller problem than 6.8% inflation.”
Here’s why Blinder’s take about the “better measure” is blatantly dishonest. The core PCE price index rose in November at “the fastest pace for the core reading since a 5.1 percent rise in the 12 months ending in September 1983,” according to The Hill.
In other words, the core index spiked at the fastest rate in 38 years, which makes the statistic a lot worse in its proper context. It’s also unclear why Blinder is lending any credence to the Powell Fed’s gauging powers to begin with, given its serious credibility dilemma on inflation.
Blinder conceded in his lead paragraph that “Inflation was a Grinch this Christmas. Economists on Team Transitory, myself included, should admit that we never thought inflation would go this high.” But then he had the audacity to imply that Biden’s gargantuan $1.9 trillion stimulus bill passed in March was “wise” even though it received blame for “stoking the flames” of the current inflation crisis.
Blinder continued his gaslighting:
In short, there is an inflationary price to pay when you catapult rapidly out of a pandemic-induced recession, and we are paying that price now. But it still looks transitory to me—though that doesn’t mean it will be over in a month or two. It won’t, which is presumably why Federal Reserve Chairman Jerome Powell recently stopped using the word, [emphasis added].
Consulting firm RSM Chief Economist Joe Brusuelas just told The Washington Post that “[r]egardless of how you look at it, inflation is going to be with us for a good period of time.” Blinder even falsely claimed that “High inflation is currently concentrated in things like used cars, airfares and gasoline.”
The Journal itself, where Blinder’s op-ed was published, reported that food manufacturers were hiking prices again for 2022. “The increases follow others that food manufacturers imposed in 2021, and are part of what businesses and economists call the highest inflation in decades.” [Emphasis added.]
Blinder seems to get a kick out of living in complete denial.
Conservatives are under attack. Contact The Wall Street Journal at 1 (800)369-2834 and demand it distance itself from Blinder’s inflation denialism.
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