1. “CHINA TAKING AMEICAN JOBS”
It is really American companies that have outsourced production of most consumer goods to cheaper and, for them, more profitable locations in China and other countries. These companies do not bring all their profits back home to the United States and avoid paying US taxes.
2. UKRANIAN WAR is the cause of the steep price increase at US gas pumps.
Only partially true. The USA fortunately is the least dependent on Russian oil or even Middle Eastern oil compared to its European allies, Japan, India, or China. Any type of disruption in supply from any source can push worldwide energy prices up but the increase in US gas prices is disproportionately high. It is not an accident that the oil companies are having record profits and the economic boom is back in Dubai and surrounding OPEC countries.
3. THE WHOLE WORLD is supporting Ukraine.
It is true if you define the world as Western Europe, Australia, and a few Asian countries. In fact, the two most populous countries in the world– India and China – have been silent. Together they are about 40% of the world population. It is also ironic that the traditional allies of the United States in the Middle East like Saudi Arabia and Israel – on whose security America has spent billions over the years – have not even publicly condemned Russia.
4. INFLATION is BAD for EVERYONE.
Not true. When you pay a higher price, always remember that someone is benefitting from that – certainly, whoever is selling you the higher-priced product and service. Those who are in debt benefit during inflation since they pay back with devalued/cheaper money. Most economists will also tell you that a moderate rate of inflation could help economic growth.
5. ECONOMIC SANCTIONS RARELY SUCCEED
This is factually true if the intent of the sanctions is to bring about a change in government or their policies. Tough economic sanctions have not worked in the cases of either North Korea or Iran. The general population in those countries has suffered but the ruling elite is unaffected. Economic sanctions have impacted the Russian population, but the disruptions have also raised the price of oil and gas. The “net” impact on a major oil/gas exporting country like Russia is not necessarily all negative. Some of the USA’s allies (e.g., Saudi Arabia) and adversaries (e.g., Iran) are benefitting from the higher price of oil. Two of the USA’s biggest trading partners – China and India – are not observing the US-EU-UK-initiated economic sanctions on Russia and its allies.
Sadly, the average voters in most countries including the United States are neither educated on economic issues nor well informed about geopolitics. It is unfortunately easy for politicians to manipulate and influence people’s minds.
Author:
Faisal M. Rahman, Ph.D.
Founding Dean and Professor
The Graham School of Management
Saint Xavier University
Chicago, IL 60655, USA Email: rahman@sxu.edu
It is all about power struggle between the Democrats and the Republicans and we consumers are caught in the middle. It is not only the gas prices going up, what about the interest rate? We had seen historic low’s in 2020 and now we are seen historic highs in 2022. Hopefully, we are not heading towards another recession.