The new chair of the House Budget Committee, Representative Paul Ryan (R-WI), held his first hearings today and his first witness was Federal Reserve Chairman Ben Bernanke. It was a learning experience for the young congressman.
Yesterday on CNBC (here), Rep. Ryan commented that he learned economics from Milton Friedman. I'm just going to guess here that what he meant to say was that he read Capitalism and Freedom, one of Friedman's philosophical tracts, because Prof. Bernanke had to correct Rep. Ryan's economics.
Rep. Ryan thinks that commodity market inflation in Egypt is something the U.S. Federal Reserve should be worried about and also thinks that the term structure of interest rates is a measure of inflation. Prof. Bernanke corrected these misunderstandings.
Unfortunately, and here's the embarrassing part for Wisconsin, Rep. Ryan went on to publicly worry about inflation that doesn't exist and the things that might happen when the non-existent inflation starts to hurt us. It's almost as if he wanted the Fed to do something stupid so that economic recovery could be postponed until after the next election. Maybe Rep. Ryan should stick to conservative philosophy where he is clearly a shining beacon of hope for the Republican Party.
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