Matt Yglesias, world-bestriding colossus of political pontification, still says there's no inflation. I'm surprised Yglesias "“ who takes special meetings with Treasury Secretary Tim Geithner and is able to repeat Federal Reserve wish lists with remarkable specificity, down to Chairman Ben Bernanke's fond standing request for an official inflation target "“ hasn't gotten the new talking points: Even Bernanke admits that notable price inflation is real but "transitory."
Yglesias, however, won't even give that inch, urging increasingly hamstrung Americans to eschew food and just consume high tech. Here's his rebuttal of Niall Ferguson's argument that you can't actually eat an iPad:
But you also can't send email from a banana or watch streaming video on a bag of rice. When electronics, communication technology, and entertainment get cheaper then you have more money left over for bananas.
Also resolved: Yglesias is lactose intolerant and walks to work. Now are you convinced?
By singling out Ferguson (who last I heard of him was urging America to act more like an empire and would, I think, be a natural ally to a beltway bright boy) for abuse, Yglesias misses some of the value in his own example. Mobile phones are almost a textbook deflationary widget. But focusing on the cost of devices (which falls rapidly "“ a pattern common in hardware not supported by the U.S. government) while ignoring how much money is being paid on data plans (which since 2004 have increased substantially in terms of carrier revenue and share of total carrier revenue), is stacking the deck.
This doesn't mean users on balance are paying more for the same or less for mobile telephony now than they were in 2004, for the simple reason that a 2011 phone adds value that didn't exist back when watching video on a phone was still uncommon. (In my experience it's not really an everyday thing even now, outside of TV commercials.)
But those damn Americans, it turns out, almost never respond to stimuli the way the models said they would. As a recent Fed study noted, most people haven't even made big changes to their real and financial holdings since the correction began in 2008. Two-thirds of U.S. mobile users are not using mobile internet at all. You can condemn anti-Stakhanovite consumers for not grabbing the real benefits of the substitution effect. But the purpose of CPI voodoo is to get an accurate measure of the cost and value experience of the average American.
Whoever the average American may ultimately turn out to be, the substitution effect favors people who can afford to swap out items in the basket, including the one item many people prefer to swap out right now: The Dollar. Some of Yglesias' commenters have noted his argument's intellectual bias against lower net worth people "“ and thank Zoroaster some lefties still believe their loyalty is to the poor.
But I propose a wider definition of the problem: CPI is voodoo. To believe WashingYork can get an accurate measure of price experience that is meaningful to any American, let alone every American, is to believe in a flat earth. And only Thomas Friedman still believes in that. Where's Thornton Melon when we need him?
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Not only does Yglesias know nothing about inflation, he doesn't the first thing about Kurt Vonnegut.
Should have asked Robert Ludlum.
Matt Yglesias?
Isn't he the smug prick that Lillian Rearden invited to her parties to piss off Hank?
No, that's Dana Milbank.
Speaking of Dana's - Dana Wynter died this weekend at 79, of heart failure. For those who may not know, she was the female lead in the original version of The Body Snatchers.
I thought it was Paulie Krugnuts.
-jcr
Progressives love inflation. Being economic illiterates and functional inumerates they really "grok" the idea that full employment can be attained through monetary policy.
I thought it was the end of poverty that could be achieved through monetary policy.
Poverty will never end as long as there is a lowest 20th percentile!
Well, let's renounce the term "lowest 20th percentile" - POOF! Poverty eradicated - AGAIN, on Obama's watch, for the record.
That guy is SO gutsy....
we've reached the point where virtually no one in America willing to work is poor by the historical standard of not having food to eat or a roof over their head. "poor" now is, at least for guys, about not being able to purchase enough in the way of status symbols to have access to better pussy. the consequence of being in the lowest 20th percentile is mainly in who you get to bang, not in being hungry or getting rained on because there's no roof over your head.
I missed four meals last week. I'm not starving, but money is very much an issue and if I couldn't go to work (for being sick) it would be really bad, as I'm paid hourly. In fact, part of the reason why it took six months for me to get out of the hole I was stuck in because I was unemployed was because I got sick four times. I attribute this to stress, since, being marginally employed is pretty stressful. Usually I'm not getting sick all that much.
(oh, right, I should probably mention that I missed those meals because my bank account sat at zero)
also I am almost certainly not getting top quality pussy anymore, but that's because I moved from DC to Man Diego, and the competition is fiercer.
And you're reading Hit &Run; on the computer down at the public library, I assume.
no, I have a job now. I'm reading it from work. I'm a libertarian, not a hipster, so, public libraries are out. Drink!
of course, they aren't paying me to be an academe. It's a good thing I'm not a liberal, because I would call this off-clocking business you see in the science enterprise "wage slavery".
s/an academe/here on the weekend/
"Poverty" will never end as long as someone has a dollar more than someone else - under the Progressive view anyway.
come on, only a monocle-and-tophat libertarian would ignore that Gini in the US has been getting worse. the question is why? And what is the remedy.
No, the question is who has any right to care? Equality doesn't matter in a system without a fixed quantity of wealth.
http://www.youtube.com/watch?v.....re=related
your right to care ends when you reach the bottom of your wallet.
About forty-odd years ago I actually knew a libertarian who sported a monocle - no top hat though. :-)
SomeWHERE over the Phillips curve, full employment will be, a WPA ditch crew on a road to Somalia away.
Worst Dorothy spoof evar!
Yeah, but I was going for Annie there, so that some how makes it even worse.
Something tells me we aren't in Kansas anymore, Toto.
The goalposts shift to "income inequality" when poverty is reduced or eliminated.
Funny how the self-styled champions of the poor vigorously defend an institution whose stated goal is to reduce peoples' purchasing power and discourage them from saving "too much"* money.
*What "too much" means is up to a committee of enlightened bureaucrats, of course.
Not too mention that the stated goals of said institution benefit government, banks, and the wealthy. They really put the "idiot" in useful idiot.
Yes but poor people are in debt, and the inflation will make the real value of their debt go poof!
Right. You have to think of the horrors that would be unleashed if everyone acted like a little capitalist, instead of a little consumer. Poor people might actually be able to grow their net worth instead of being little mouths designed to consume.
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