Thread by @JWMason1

Unless I'm misreading the numbers (a possibility!), essentially all of the above-target price rises right now are in two sectors, oil and cars. If you're talking about "inflation" right now, that's the phenomenon you're referring to.

So if you are using "rising inflation" as an argument for anything, it's worth pausing and checking if the argument still works if you substitute "higher oil prices" and "more expensive cars."

It's not clear to me why either of those facts, on their own, would be arguments for scaled-back infrastructure spending, or curtailing unemployment benefits, or raising interest rates. But they are not, they still aren't when you call them "inflation."

You could go a step further. Suppose you support a carbon tax (many people do). What is that tax supposed to accomplish? Presumably, higher prices for fossil fuels and fossil-fuel based transportation. If that's not the goal of the carbon tax, what is?

So if you wanted to bring about those kinds of price changes thru legislation, why be unhappy when they come thru market prices? Shouldn't you see it as a good thing? If you want less driving and think prices can deliver it, you should want more of our current "inflation".

(This has nothing to do with NGDP paths or forward guidance or making more space for negative real rates or any other arguments for higher inflation in general. The point is there is no inflation in general, just rising prices of particular things, in this case oil and cars.)

Now some people might say that yes, they support a carbon tax, but that it should include some kind of compensation for those who bear the cost of it, which rising market prices don't offer. That's fair enough.

But the kind of steps you might take to offset burden of carbon tax - direct income supports, investment in low-carbon alternatives - are exactly the opposite of the standard remedy for "higher inflation", which is to reduce people's income and invest less.

*if* they are not