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Politicians CAUSE Inflation; They Don’t Cure It

We are big fans of Mark Perry an economist at the American Enterprise Institute who writes the must-read Carpe Diem blog. His recent analysis of price trends is a classic. As we’ve argued many times on these pages, the two industries with the most inflation are health care and education. Those happen to be the two industries that government regulates and controls the most and are supposed to make MORE affordable. Gee, the politicians are doing a great job of it, aren’t they?

Perry has updated the numbers through the end of 2021 and sure enough: health care and k-12 education are still growing by leaps and bounds faster in price than any other industry or product line.

Anyone still believe that the Biden Build Back Better proposal to subsidize and regulate child care and pre-kindergarten will LOWER costs?

What is also interesting is to focus on the products that are falling most in price: Computers, software, and information services. But Biden’s regulators want to break up these tech companies for anti-consumer behavior. How can an industry that is slashing prices through increased efficiency be hurting consumers? Food prices have fallen in real terms over the last 20 years and have only risen since Biden entered office. But Biden is investigating the meat industry.

Other industries with falling prices include consumer items such as toys and clothing which are subject to international trade. Free trade increases competition and lowers prices.

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