The United States Senate should require a course in economics for its members. Too many of the socialist Democrats in the current majority clearly do not understand basic economic principles or the true lessons of economic history.
This week, Senator Elizabeth Warren attempted to take Federal Reserve Chair Jerome Powell to task in his confirmation hearing over what she stated was “Econ 101.” Reading from a prepared script, the former Harvard Law School professor tried to get Powell to admit that today’s large corporations are to blame for rising prices and inflation.
Powell deftly and politely deflected her strange argument that large American corporations are using the current of higher prices to fatten their profits. Her so called “evidence” was the fact that two-thirds of publicly traded companies have higher profit margins than last year. Well, let’s certainly hope so the year following a global pandemic!
Warren fell back on her faulty “we’re doing Econ 101 here” argument– a class she apparently failed to take— and Powell, like a good teacher to a befuddled student, explained corporate profits are driven by a whole host of forces, the most important of which is consumer demand. I wish he had taken the chance to lecture the Senate Democrats on their unnecessary $3 trillion of partisan spending in 2021.
One of the greatest economists of all time, Milton Friedman, taught that “inflation is always and everywhere a monetary phenomenon.” The Federal government itself could be accused of facilitating the Democrats overspending and over borrowing, but American companies simply can’t be blamed for our current inflation. Senator Warren should look in the mirror to see who is really to blame for inflation and then sign up for Econ 101.