My congressman and our Louisiana senators are gripped with absolute delirium about inflation and claiming Biden should be able to single-handedly stop it. But many if not most of the factors are beyond his control unless you were to propose some tax structures to change it. Such as a windfall profits tax on oil with direct credits for restarting capacity that was mothballed during the pandemic.
And that’s reason one. The major oil producers not only shut down operating Wells reducing capacity by maybe 10%, they also shut down refineries. And they see no reason to pay someone to start up a well again or bring a refinery back online when they’re making record profits from the status quo.
According to the Texas oil and gas attorney blog “there is a substantial lead time to bring wells back online and into production.” And he’s not some environmental loony. He says oil companies don’t trust “the dementia-fueled irrationality of Biden.” So, it’s not just as my argumentative Facebook pal Thad suggested in another place as simple as turning a valve. Depending on how long the well’s been active they might actually have to bring in a drilling rig to clear out the borehole. Restarting a refinery (undamaged) after a hurricane shutdown can take up to a month. I can’t find good data on what it might take after two years offline, but the Energy Information Administration says it can take months after a prolonged shutdown. It’s no a “throw a switch” thing.
Reason number two is that production of American consumer goods was shifted overseas by Reaganomics (with disastrous domestic economic consequences). Then along came the plague and people shifted a lot of their purchasing to online much of which is produced overseas. The nine companies that control ocean-borne commerce in the world raised the prices to move a container by a factor of 12 during and after the pandemic. These are multinational companies. Does Biden just end imports? This is entirely out of Us control.
Point number three is not an inflation thing but is directly tied to Reaganomics which no Republican member of Congress will vote to overturn making it impossible to put any changes through the slavers Senate. Formula production like much of us industry is concentrated in a very few companies. Abbott Laboratories neglected or refused to replace aging drying equipment used in the manufacturer of powdered formula in spite of FDA warnings about it. (They did manage to find $3 billion dollars laying around for a stock buyback). And then two babies died from contamination. And the FDA shut their major production plant down. Oh, and Trump’s NAFTA replacement put terrace on imported baby formula including formula from Canada so nobody was importing formula. So given that Trump looking faction in the Senate how quickly do you think that could restore more rigorous regulation of human consumables like baby formula? Or renegotiate the trade deal?
This brings us to 4, food costs. Those monster waving Looney socialists at the US Chamber of Commerce say these are the reasons for high food costs: Labor shortages. Supply chain disruption. Higher energy prices. Much of farm labor is done by immigrants regardless of their paper status. Closing the border was basically cutting off the labor supply for agriculture. Thanks trump. Supply chain disruption was largely a result of the plague. Should have nationalizing the transportation companies are putting them under military control I don’t know how Biden fixes that. Higher energy prices we’ve already discussed.
So when our legislative delegation is ranting about Biden’s inflation I don’t presume they’re ignorant. Steve Scalise has a college degree in computer programming that he never used but his ruthless political acumen suggests he is not an idiot. U.S. Senator Bill Cassidy is an MD and Senator John Kennedy has a juris doctor from Oxford University in England in spite of his Foghorn Leghorn routine. They’re just trying to score political points against the Democrats and to bury the Reaganites and Trumplicans large roll in creating the conditions that are leading to inflation. Enter score those points they use a ton of voice usually associated with shouting fire in a crowded theater.
I am reminded of the quote attributed to Huey Long. After accusing a political opponent of lying a reporter asked him how do you know when he’s lying? And long supposedly reply when his lips are moving he’s lying.