Vox publishes long piece on inflation centered on misunderstanding of inflation
March 29, 2022
The United States is suffering a burst of inflation. If we knew what caused it, we might be able to reverse it and stop the inflation. Why not turn to Vox who, as they say, can explain the news to us?
Well, the reason might be that it published a long piece that manages not to use the standard economic explanation of inflation. This is a bit of a failed attempt to explain the news.
There are, as Vox points out, temporary things increasing prices. Disruption to both shipping and computer chip supply as a result of the pandemic and lockdowns. Some argue that there’s been a new outburst of greed among corporations.
But that just plain old standard economics says that if we print a lot, a lot lot, of money, then prices will rise. Just because there are more pieces of money chasing the same number of goods and services. This is what Milton Friedman meant when he said “Inflation is always, and everywhere, a monetary phenomenon”.
This isn’t even controversial. Back when that quantitative easing started the Federal Reserve insisted it was to try to create a little inflation to stop the economy from falling apart. Eight trillion dollars of money printing later, here it is: the inflation.
As we’ve said Vox markets itself as “explaining the news.” It’s in the top 100 of news outlets in the United States and gains some 24 million visits a month from being there. There’s also a substantial YouTube operation to add to that.
This might sound picky but when trying to explain inflation it might be useful to outline the standard scientific explanation for it – even if only then to refute or reject it – which is exactly the thing that Vox doesn’t do. So much for explanations then. As to why, well, there we can only speculate. Some might be unhappy at the idea that inflation arriving does mean government can’t just print money and spend it on whatever.