Why Inflation is Running Rampant

A must-read post at GetLiberty.org, the Web site of Americans for Limited Government, about how misguided government policies are driving up the price of all essentials for Americans. Things would get much worse of Barack Obama gets his way on higher taxes and more government control of the economy.

From GetLiberty.org:

Now, in Economics 101 we all learned that taxing a good will increase the cost, and thus lower the incentive to produce, which in this case would effectively decrease the oil supply to Americans further. As for subsidies, basic microeconomics states that by subsidizing an industry, that industry has its costs decreased, while still being able to charge the going price, thus driving out any competitors. Basically, Barack Obama is proposing to increase the price that Americans pay for energy even more.

To add further insult to injury, the subsidization of corn has ramifications that extend to the entire Consumer Price Index. Corn and its by-products are a main component of just about every food good imaginable—how many things have corn syrup in them? In addition, corn is a main component of beef and milk production, and the price increases of corn we have been seeing in the commodities market are directly attributed to the subsidies.

Read the full article, "And We Wonder Why Inflation is Running Rampant…," by clicking here.