Inflation

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Political Choices: Backward vs Forward Looking

In American politics, you have two main choices: go back (conservatism); or move forward (liberalism). Neither one is perfect. About 80% of voters are set on their respective views, with about 20% staying independent moving in one direction or the other depending on the feelings of the moment. 

Conservatism is backward looking. The idea is to shape our future based on our past traditions. The problem of such an approach in this country is that if you go too far back you get to our racist and colonial origin. The thought process behind conservatism is completely influenced by Judaism and Christianity.

The conservative perception of reality is that the past was perfect (Garden of Eden), and that the present is a test as we move forward towards the end of the world (Apocalypse). This doom day scenario requires a savior to lead the masses towards salvation. No wonder why the vast majority of Trump supporters see him as a "savior" that can save America from the dooms day of liberalism.  

Liberalism is forward looking. The idea is to shape our future to be better than our past. The thought process is that our past was not so great, and that the present is better, but in need of continuous improvement. Liberalism is heavily influenced by science and the view that we can make progress in life to improve the human condition. The approach is not perfect, and can prove alienating to religious fanatics and conservatives.  

In theory, voters would choose political sides based on their views and preferred problem-solving approach. Should we tackle today's problems looking back to our traditional and historic ways, or should we look forward to new and innovative approaches? The most practical answer would be a combination of both. You would look into the past to capture lessons learned, and move into the future with an open mind for innovative and pragmatic solutions that will most likely be different from our traditions.  

A combined conservative / liberal approach would be a rational approach. However, humans are predominantly emotional animals. That is, emotions come first and reasons follow. For the most part, our "reasons" are just rationalizations for our underlying emotions. When it comes to political affiliation, about 80% of the voters align themselves by group identity rather than by substantive issues. That is, people vote like their "tribe", under an "us vs them" mindset. People identify with a group, and votes like that group without much independent thinking. Humans are primates and instinctively seek to belong to a troop or tribe, and follow the group norms regardless of whether they make sense or not. 

Republicans for example are said to be the party of "law and order". In the context of incarcerating blacks and latinos, Republicans are in fact the party of law and order. However, when their leader is accused of serious felonies, including mishandling of classified Top Secret information, the "law and order" theme fades away quickly. That is understandable because sending blacks and browns to jail is seen as a political victory aligned with colonial tradition whereas sending Trump to jail would be decapitating their own conservative movement.  

Donald Trump is the gift that keeps giving for all Americans and all citizens of the world. Trump is showing that racism is no longer viable in today's world. Trump is showing that fraud and crime do not pay. In prosecuting Trump, the United States will demonstrate that we are committed to ending racism, and that we uphold the rule of law principle that indicates that no one is above the law; not even the MAGA king. 

On the surface, it can be said that the U.S. economy did well during Trump's presidency. However, when you see how much the National debt increased during Trump's presidency, you realize that economic growth was mostly due to a transfer of wealth from public to private hands. In theory it can also be said that Trump's term was relatively more peaceful around the world because Putin had not invaded Ukraine. Yet you can also say that Trump did the legwork for Putin in making him ready to invade Europe. 

Regardless of past opinions about Trump, the fact is that people are concerned today about inflation and about an incoming recession. There is nothing to worry about. Just prepare for it. Liv within your means. Stop wasting and start producing. Is food expensive? Eat less expensive stuff. Lose weight. Is gasoline expensive? Drive less and pollute less. Deal with it. Be smart and prosper. 

Inflation is temporary. Sooner or later, prices will come down dramatically. Prices are high because of COVID lockdowns and COVID stimulus payments. The lockdowns reduced both the production (supply) of goods, and their consumption (demand). At the end of the pandemic, too many dollars began to chase the goods available. 

When demand increases and supply remains low, prices increase. Add to that the effect of Putin's invasion of Ukraine, and you can easily understand why prices have increased. As supply chains increase production, and the world finds substitutes for Russian energy and Ukrainian grains, inflation will collapse and prices will come down dramatically. You can bet on it.

Food for thought. What do you think?

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