Rick Perry has no idea how economics works
Energy secretary, former Dancing With The Stars contestant, and hmm — what’s that third thing? — Rick Perry does not understand how economics works.
In a speech at a West Virginia coal plant on Thursday, Perry attempted to offer the crowd a little lesson in supply and demand.
“Here’s a little economics lesson: supply and demand.” Perry said. “You put the supply out there and the demand will follow.”
Unfortunately for Perry, that’s not how it works. Since the 1930s, economists generally agree that supply follows demand, and excess supply leads to supply gluts and not more demand.
Put simply, if you mine a bunch of coal it does not mean people will suddenly want more coal.
Ironically, this is one of the central tenants of global energy policy. An increase in the global supply of oil without commensurate increases in global demand decreases the price of oil, forcing international organizations like the Organization of the Petroleum Exporting Countries to try and restrict supply in order to raise the price.
Perhaps Rick Perry should have taken a few more economics classes. After all, he did get a D in “Meats.”