Inflation Risk is the Wrong Recession Lesson

This might be the most dangerous economic assertion circulating today: the high inflation from 2021-2023 was caused by government stimulus. The talking point on the right goes: the third COVID-era stimulus checks landed in March 2021, prices took off, case closed. Of course reality is more nuanced. And most serious estimates pin only a point or two of the inflation peak on the bill; the rest was supply chain chaos, a global chip shortage, and the Ukraine war. The pandemic caused the worst job loss on record — and the response produced the fastest labor-market recovery we've ever had, because policymakers went big. The danger is that they remember the inflation and forget the recovery.
Chapters:
00:01:14 Announcements
00:03:24 Retcon: Q1 GDP Revised
00:04:50 Terms & Conditions: Output Gap, NAIRU, "The Long Depression"
00:11:49 Big Pilcrow: Is Recession Recovery Getting Blamed for Inflation?
00:42:14 Executive Orders: Parallel parking licenses, FIFA ticketing ban
00:45:52 Spiritual Sponsors: Small hardware stores, handwritten letter to OE

• Support Optimist Economy: optimisteconomy.com/donate

• Video-curious? Watch the Optimist Economy YouTube channel⁠⁠ (youtube.com/@optimist_economy). We’re also on Instagram at ⁠⁠@optimist_economy (instagram.com/optimist_economy) or TikTok at ⁠⁠tiktok.com/@optimist_economy. Or search for us on Facebook.

• Chat with Optimists on Substack. (substack.com/chat/4604257?utm_source=pub-nav-bar)

• Hats, tees and totes: merch.ambientinks.com/collections/optimistecon…

• Reach us at: optimist.economy@gmail.com