Thursday, March 1, 2012


Does everything seem more expensive? Do you notice your paycheck ending before the bills get paid? Have you heard on the news the line that "The Consumer Price Index, excluding the volatile food and fuel sectors, rose .2% this month, indicating that inflation is being held in check."

Sure. The CPI includes the price of a new home too, so if you buy new homes monthly and can get by without eating or driving, things are just peachy. CBS (!) is noting that if you eat and drive to work, and avoid binge buying of homes, the inflation rate is closer to 8%.

Contributing to this is the administrations attitude toward gasoline prices. The official position is that when the gasoline and oil disappear, we will adopt clean, renewable energy sources that are currently being developed by contributors to the administration.
“We agree there is great suffering when the price of gasoline increases in the United States, and so we are very concerned about this,” said Chu, speaking to the House Appropriations energy and water subcommittee. “As I have repeatedly said, in the Department of Energy, what we’re trying to do is diversify our energy supply for transportation so that we have cost-effective means.”
Stephen Chu, Energy Secretary.
So he agrees that we're suffering, but believes it's good for us. Not only does he know nothing about energy, he knows nothing about economics.

To be cost-effective, an alternative energy source must compete on a cost per unit basis with the incumbent sources, be they nuclear fusion or refined unicorn farts. If a source is uncompetitive, the solution is generally NOT to raise the price of the existing source and subsidize the challenger. In the end, the consumer simply winds up paying more for the same kilowatts, btu's or whatever.

2012, It's not just an election, it's a cease-and-desist order.

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