Perry’s ‘Little Economics Lesson’ Gets Supply and Demand Backward on Visit to Failing Coal Plant
The Interwebs were at their withering best last week, after U.S. Energy Secretary Rick Perry tried to deliver an Economics 101 lesson during a visit to Morgantown, West Virginia to defend his country’s collapsing coal industry.
“Here’s a little economics lesson: supply and demand,” Perry said, according to S&P Global Market Intelligence reporter Taylor Kuykendall. “You put the supply out there and the demand will follow.”
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Perry’s magical thinking—the mirror opposite of the way market economics actually work—triggered immediate memories of a line from Field of Dreams, Kevin Costner’s iconic baseball movie: “If you build it, they will come.”
Unfortunately for Perry, “the same logic does not hold true for the most basic and fundamental of economic theories: the law of supply and demand,” Newsweek notes. “Even the vast majority of people who have never stepped foot inside an economics class will know that simply increasing the supply of coal will not lead to an increase in demand.”
In fact, as oil producers are learning in the midst of a sustained supply glut, it’ll just drive down prices.
The response online was fierce and hilarious.
“That’s what I said at the opening of my buggy whip factory,” tweeted @danablankenhorn. “Put out supply and demand will follow. Right, Secretary Perry?”
“Nice to know Soviet economic theory is thriving somewhere,” commented Kasparov63. “Now just order everyone to use that coal and the command economy will take off!”
“Perry must have taken his Econ class at Trump U,” suggested @Jgoldie2393.
The Longview coal plant, where Perry was speaking, was an odd place to deliver his backward economics lesson, ThinkProgress notes. “The plant, which went online in 2011, went bankrupt in 2013. At the time, the Wall Street Journal blamed low natural gas prices for the plant’s economic woes.”
And the talk took place “just days after West Virginia University released a report that echoed numerous recent analyses in stating coal demand will not be coming back,” writes climate reporter Samantha Page. “The report attributed the long-term outlook for coal production to low demand overseas, declining productivity in West Virginia’s mines, and a decrease in U.S. coal-fired power plants — which, again, is tied to low-cost natural gas prices as well as increased emissions standards and more economical clean energy.”