Inflating Ourselves Until We Turn Green

A customer prepares to pump gasoline into his car at a Valero station in Mill Valley, Calif., on July 12, 2021. (Justin Sullivan/Getty Images)

Commentary

Inflation is now at its highest level in 31 years, but the Biden administration would have us believe that higher prices have no connection to its big-government policies, and that the president and his subordinates have little if any influence on the cost of purchasing what we need to live.

President Joe Biden himself passes the buck and claims that high gasoline prices are “because of the supply being withheld by OPEC.” His secretary of energy, Jennifer Granholm, laughs off a query about the administration’s domestic fossil fuel policy because it would take a “magic wand” to influence the global oil market “controlled by a cartel ... called OPEC.”

At least she didn’t encourage the wearing of Gerald Ford’s “Whip Inflation Now” buttons with their implicit message that it’s consumers’ own fault for buying what they liked. Presumably, this administration considers it a coincidence that the energy independence we enjoyed before Biden came into office went hand-in-hand with low costs at the pump.

It would be political suicide to encourage Americans to learn to stop worrying and love the boom in the prices of their food and fuel, but despite this White House’s rhetoric, the notion that “inflation is good” is far from new as a principle of class warfare. And global warming fanaticism makes it all the more attractive to the left.

For instance, the late Marxian journalist and “Secrets of the Temple” author William Greider, whom Rolling Stone magazine enlisted to make taxes and spending look as cool as the free market was cruel, believed that higher prices have “a redistributive effect from those who have accumulated financial wealth to those who are borrowers.”

And probably no one’s work has been used to justify big-spending, inflationary policies more than that of the most influential economist of the 20th century, John Maynard Keynes. As conservative economist Thomas Sowell has noted, “In the heyday of Keynesian economics, many economists believed that inflationary government policies could reduce unemployment, and early empirical data seemed to support that view.”

Yet Keynes himself, in “The Economic Consequences of the Peace” in 1919, warned that inflation is a favored weapon of collectivists—including communists—to damage or even destroy the free market.

“Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency,” Keynes pointed out over a century ago, during the infancy of the Soviet Union. “By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. ... Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency.”

In the 2020s, “saving the planet” provides a powerful new rationale for overturning the basis of the free world’s society. In the United States, gasoline prices have been among the lowest in the world for decades, an obstacle to making alternative forms of energy prices competitive. We may not hear Democratic politicians call for big increases in fuel prices, but such calls are to be found under the radar in the work of the academics and other thinkers of deep thoughts who provide the intellectual foundation of Democrats’ policies. Higher gas prices are euphemistically referred to as “Incorporating the real costs of health, carbon and resource degradation into fuel pricing.”

During the Obama administration, one green scholar cited the work of a German transportation economist to advocate massively increasing gasoline taxes in the United States by “more than $7.62 a gallon.” This was deemed necessary so our country would be ”fully corrected for the social costs of car reliance,” in spite of the admitted fact that doing this “would upend life as Americans know it.”

Oil brings food from farm to table, gets us to work and back, takes those in danger of death to the emergency room, and warms us in the winter months. When fossil fuels get more expensive, it can’t help but exacerbate inflation in the general economy.

We may live in a democratic republic, not a totalitarian tyranny, but as inflation rages, it’s worth appreciating what Keynes recognized to be up the sleeve of the founder of the Soviet state over a century ago: that government, “secretly and unobserved,” uses inflation to confiscate the wealth of its citizens as a sure, if subtle, means of upending a society based on economic freedom.