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Published On: Tue, May 29th, 2012

Paranoia, Democrats, and the Speculators

Now that a Democrat is in the White House, I find it interesting that near-record gasoline prices somehow have nothing to do with Barack Obama. When gas prices four years ago went up under the Bush White House, Democrats quickly claimed that it was Bush’s fault.

Not surprisingly, Paul Krugman continues the partisan line that anyone who thinks that Obama’s policies have anything to do with the pain at the pump is being paranoid. This is quite rich, especially given that Democrats en masse are claiming that it all is the work of those dastardly speculators.

And even though Krugman the economist should know that blaming speculators is like blaming wind for a tornado, we see that he keeps silent, which makes me wonder if he really believes this nonsense — or if he is being cynically quiet. Either way, it seems that he is endorsing paranoia, or at least paranoia that is partisan in nature. (Gee, what happens when oil prices fall? Does that mean that speculators are taking a day off?)

Of course, what is a Krugman column that does not make excuses for Obama? During the campaign, Obama said that policies he wanted to put into place would cause energy policies to “skyrocket.” Krugman says that the term was “unfortunate,” although I doubt he would be so gracious to a Republican or to someone like Ron Paul.

Then there is the matter of Obama’s energy secretary, Steven Chu. This is the same Steven Chu who before taking office declared:

“Somehow we have to figure out how to boost the price of gasoline to the levels in Europe”

Chu conveniently claims he does not believe that now, although I doubt he is telling the truth. Like so many other Progressives, Chu believes that Americans should be forced into a lifestyle that people like Chu, Krugman, and Obama have no plans of adopting for themselves.

Then there is the small issue of the dollar and the fact that oil prices worldwide are denominated in that currency. The Ben Bernanke Fed is showering the world with dollars (although Krugman believes not enough dollars), so we should not be surprised that when the Fed deliberately engages in inflationary policies, that energy prices — and other commodity prices, for that matter — are going to go up.

Not surprisingly, Krugman calls all of this “paranoid.” When people take Obama and his administration at their word that they want to force Americans out of fossil fuels (which Obama has vilified), and then the results create real economic pain, then suddenly we are supposed to believe that whatever Obama and his minions have said is irrelevant.

Once again, we see Paul Krugman abandoning economics for partisan rhetoric. No, we should not be surprised. Remember his claim that because Grover Norquist had once said that we should reduce government to a size where it can be “drowned in a bathtub,” therefore all Republicans are wanting to do the same? Yes, the Bush administration was trying to reduce government. And I have a bridge in Brooklyn to sell to Krugman.

Check out the “Krugman in Wonderland” posts here on The Global Dispatch – click here


William L. Anderson is an author and an associate professor of economics at Frostburg State University in Maryland. He is also an adjunct scholar with the Mackinac Center for Public Policy as well as for the Ludwig von Mises Institute in Alabama.

Read more at “Krugman-in-Wonderland”

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About the Author

- William L. Anderson is an author and an associate professor of economics at Frostburg State University in Maryland. He is also an adjunct scholar with the Mackinac Center for Public Policy as well as for the Ludwig von Mises Institute in Alabama.

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