The root causes on 1970s stagflation are complicated. There was a massive increase in money going to the poor from the Great Society. There was massive military spending in Vietnam. There was a decline in worker productivity growth. There was also, perhaps most importantly from my point of view, the rolling energy crises of the '70s.
Energy is a massive part of the cost of everything you buy and when gas prices spiked that increased the price of shipping just about everything and that led to price increases.
Today, as Krugman lays out, we are faced with a new energy crisis centered on electricity. Because we have an AI and crypto bubble forming, we are building out massive amounts of data processing that consume huge amounts of electricity at precisely the time that Trump is killing renewables, because reasons.
I'm quite obviously not Paul Krugman, but I understand supply and demand. Demand is up and Trump is killing the cheapest form of supply.
This is going to hit people in their budgets in ways that will lead to backlash, even if Trump isn't 100% responsible for it.
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