Dow Chemical Price Increase Is Sign Inflation Is Coming

May 28, 2:21 PMGlobal Warming ExaminerJohn Ryden

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Dow Chemical Company announced that it will raise its prices up to 20% to offset soaring energy prices. Dow provides raw materials used in many everyday products including plastics, detergents, paints, cars and most other products. Just a sign that inflation is starting to work its way from the producer price index into the consumer price index.

Dow Chairman and Chief Executive Andrew Liveris made the following statement:

“For years, Washington has failed to address the issue of rising energy costs and, as a result, the country now faces a true energy crisis, one that is causing serious harm to America's manufacturing sector and all consumers of energy. The government's failure to develop a comprehensive energy policy is causing U.S. industry to lose ground when it comes to global competitiveness, and our own domestic markets are now starting to see demand destruction throughout the U.S.”

I totally agree with his statement that the failure of our government to enact a comprehensive energy policy is going to cause a lot of pain. Incomes won’t rise enough to cover the increase in prices. It is particularly harmful to people on fixed incomes. It represents a real reduction in living standard.