Dishonesty or Stupidity?

CNN is running a story today explaining how the presidential candidates do not understand economics. My first mistake was deciding to read the article. The reporter, Charles Riley, has cobbled together a series of quotes from professors who disagree with the policies of the various candidates, but these views are all presented under the umbrella of a charge that the candidates themselves no longer understand economics (if they ever did). Instead of writing an article about policy disputes, Riley pens his piece about how stupid and uneducated the candidates are. The sad thing, however, is that Riley is the one who does not understand what he is talking about.

Here is a good example: Riley takes on Michelle Bachmann for her promise to bring back $2.00 gasoline. According to the professor that Riley consulted, that cannot happen. But this only reveals the lack of knowledge of the professor and Riley. In 2008, oil fell from $140 per barrel to under $40 for the same amount. The price of a gallon of gas went below $2.00. Now no one wants to go through another big recession to get the price of gas down, but the point is that such a reduction is certainly possible. Further, were the USA to actually cut the need for imported oil in a major way and increase domestic production, the world price of oil would likely fall by quite a bit. If the cut in oil imports were big enough, gas prices could fall to the $2 area.

Another instance where Riley and his professor buddies do not know what they are talking about came in the discussion of Mitt Romney's call to take on China for its undervalued currency. Riley just says that such a move could lead to retaliation. This is supposed to be a statement of economics, but, of course, it is just an argument as to the politics of such a move. Indeed, Riley does not even bother to address the possibility that the Chinese might decide that cooperation and negotiation was better than confrontation. China has a lot to lose in a fight with the USA. Riley simply assumes that the Chinese will confront us and that enormous damage will happen. But none of that is economics.

The truth is that Riley and CNN are just using the typical structure of the left. Some "expert" professor says that the GOP does not know what iti si talking about. The truth, however, is far, far from what Riley is writing.