FRED ABRAHAM: Uninformed opinions about economics troubling | Columnists

It’s frequently troubling to me when I read the Letters to Editor on the Courier op-ed page. I am a strong supporter of the First Amendment and believe people have the right to express their opinions on just about any issue. However, the troubling aspect of this is when the opinions are so inaccurate. Many times they are little more than rants against some evil, usually a perceived one, that is not necessarily real or accurate.
As you might imagine, I am most frustrated by the opinions spouted about economics. They are usually contrary to what economists have discovered and use to predict economic behavior.
For example, we have been hearing a lot about inflation lately and blaming president Biden for it. The reality is unless presidents can control Congress and the Federal Reserve (called the Fed), they have extremely limited impact on the economy.
Economists identify several causes of inflation and seldom mention presidents in our models. To be clear, economists don’t have complete agreement on how the economy works. Economics is complicated. We understand the overall picture but struggle with the details
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Inflation can be a function of several things. Massive government spending when an economy is close to having everybody who wants to work employed could cause it. An overly loose monetary policy of the Fed is probably the biggest concern. But also, what about supply chain issues? What can the president, or indeed anyone, do about oil refineries that shut down or produce less gas? Very little. And food shortages can have an enormous impact on prices. Further, we don’t have much control over what happens on the international scene and that has a big impact on our prices. Computer chips are in short supply world wide and we use millions of them.
So what can we do? We recently passed the Inflation Reduction Act designed to curb inflation. However, it’s misnamed. The law will have almost no effect on inflation but it will have a large impact in restructuring tax policy, environmental issues, and energy concerns.
The Fed is probably the most effective entity against inflation. By causing interest rates to rise, spending is reduced and inflationary pressures eased. The Fed will be meeting next week and will probably raise its interest rate target to cool inflation. As a reminder, recall that the Fed is a pretty independent organization, answering to almost no one.
My concern is so few people understand what and who can affect inflation. Blame becomes highly political and far removed from the actual economic causes. Those stickers you saw on gas pumps that said “Thanks Biden” were entirely political and made no sense. Just another ill-advised and stupid political criticism having nothing to do with inflation or the president’s role in its cause.
If someone wants to criticize an elected official, they have that right. But if they intend to criticize leaders for poor or misguided economic policy, they should understand economics and not rely on lunch or barroom conversations. Maybe take an economics course at one of our local colleges before going down that path. Or call me and we can discuss it.
Photos: Preps to Watch Sept. 14, 2022
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Columbus Catholic defenders Carson Hartz (23) and Nick Merrifield (6) bear down on Dike-New Hartford’s Jerek Hall during second quarter action Friday in Dike.
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Columbus Catholic’s Carson Hartz pins AGWSR’s Clayton VanLoh Thursday in Waterloo.
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Columbus Catholic junior Carson Hartz and senior Carter Gallagher attempt to force Vinton-Shellsburg senior Kale Schulte out of bounds on Friday in Waterloo.
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Denver’s Anna Curtis fires an attack over the net as Columbus Catholic’s Isabelle Noland defends Thursday in a North Iowa Cedar League match at Oppold Gymnasium.
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Denver’s Anna Curtis runs the anchor leg of the 4X100 meter relay during the Lady Simons Relays at Dike-New Hartford High School on Tuesday.
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Denver’s Anna Curtis (3) celebrates a point scored over Boyden-Hull during the Class 2A state quarterfinals volleyball match at Alliant Energy PowerHouse Tuesday, Nov. 2, 2021, in Cedar Rapids.
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Denver’s Anna Curtis, left, and Tiffani Wright dig against Boyden-Hull on Tuesday at the state volleyball tournament.
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Waterloo West sophomore Jada Smith leaps to make the block at the net against Waterloo East on Thursday at East High.
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Don Bosco junior Myles McMahon dives as a ground ball gets past his glove during a Class 1A district game on Tuesday at Traer.
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Don Bosco junior Myles McMahon delivers a pitch against New London on Tuesday in Norway.
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North Tama’s Josh Dostal reaches for an errant throw as Don Bosco’s Myles McMahon dives back to first safely in the first inning Monday of an Iowa Star baseball game in Traer.
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Hudson’s Karter Krapfl competes against Don Bosco’s Myles McMahon during the Keith Young Invitational at Cedar Falls High School on Saturday.
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Don Bosco’s Myles McMahon looks to get past GTRA’s Max Hough in first-half action Friday in an 8-player playoff game in Gilbertville.
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Don Bosco junior Myles McMahon runs the ball for yardage against Gladbrook-Reinbeck earlier this season.
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Don Bosco’s Myles McMahon controls North Tama’s Cale Bradley in a 113-pound bout during Saturday’s Class 1A sectional tournament in Winthrop.
Dike-New Hartford vs Central Lyon girls state basketball

Central Lyon’s Desta Hoogendoorn tries to pass around Dike-New Hartford’s Jadyn Petersen (3) and Taylor Kvale during Dike-New Hartford vs Central Lyon Class 3A championship action of the Iowa girls basketball tournament played Saturday, March 5, 2022, at the Wells Fargo Arena in Des Moines.
Dike-New Hartford vs South Central Calhoun girls state basketball

Dike-New Hartford’s Jadyn Petersen pulls down a rebound under pressure form South Central Calhoun’s Sayer Steig during Class 2A quarterfinal round action of the Iowa girls basketball tournament Tuesday at Wells Fargo Arena in Des Moines.
State Volleyball Finals DNH 7

Dike-New Hartford sophomore Jadyn Petersen goes for the kill against Western Christian during the championship round of the state volleyball championships at the Alliant Energy Powerhouse in Cedar Rapids.
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Dike-New Hartford’s Jadyn Petersen (8) celebrates a point scored against the South Hardin during the Class 2A state quarterfinals volleyball match at Alliant Energy PowerHouse Tuesday, Nov. 2, 2021, in Cedar Rapids.
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Dike-New Hartford’s Jadyn Petersen (8) bumps against the South Hardin during the Class 2A state quarterfinals volleyball match at Alliant Energy PowerHouse Tuesday, Nov. 2, 2021, in Cedar Rapids.
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Dike-New Hartford’s Jadyn Petersen watches her attack glance off the hand of Denver’s Reese Johnson (10) during their match Tuesday in Denver.
Dike-New Hartford distance medley exchange
Dike-New Hartford’s Addy Sohn begins her 400-meter leg after taking the baton from Jadyn Petersen in the Class 2A distance medley. The Wolverines placed eighth in the event.
Dike-New Hartford vs Denver state volleyball
Dike-New Hartford’s Jadyn Petersen hits past Denver’s Reese Johnson during Dike-New Hartford vs Denver Class 2A championship action of the Iowa high school state volleyball tournament played Thursday, Nov. 5, 2020, in Cedar Rapids, Iowa.
Fred Abraham is professor emeritus at the University of Northern Iowa. The opinions expressed in this article are those of the author, and do not reflect those of the university.