Brad DeLong has some fun with Senator Pat Roberts, who has gone from praising Janet Yellen in August to denouncing her as a dangerous inflationist now. So the senator is willing to say whatever the Tea Party wants him to say; big surprise.

What remains notable, however, is just what all Republicans are obliged to say: Ron Paul monetary theory has become obligatory:

Vice Chair Yellen will continue the destructive and inflationary policy of pouring billions of newly printed money every month into our economy, and artificially holding interest rates to near zero. This policy has been in place far too long.

So, the Fed began rapidly expanding its balance sheet when Lehman fell — more than five years ago. Here’s the result of that “destructive and inflationary” policy so far:

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It’s not often that you see an economic theory fail so utterly and completely. Yet that theory’s grip on the GOP has only strengthened as its failure becomes ever more undeniable.

Incidentally, small nerdy note. Some people argue that the concept of the monetary base has lost its relevance now that the Fed pays (trivial) interest on reserves. I disagree. Reserves and currency are fungible: banks can turn one into the other at will. But the total of reserves and currency is fixed by the Fed — nobody else can create either. That, as I see it, makes them a relevant aggregate — and anyone who believes that all those reserves are sitting idle because of that 25 basis point reward is (a) silly (b) ignorant of Japan’s experience, where the BOJ sharply increased the monetary base without paying interest on reserves, and what happened looked exactly like our own later experience.

Back to the evidence versus the orthodoxy. I can, in a way, understand refusing to believe in global warming — that’s a noisy process, with lots of local variation, and the overall measures are devised by pointy-headed intellectuals who probably vote Democratic. I can even more easily understand refusing to believe in evolution. But the failure of predicted inflation to materialize is happening in real time, right in front of our eyes; people who kept believing in inflation just around the corner lost a lot of money. Yet the denial remains total.

I guess it’s a matter of who you’re gonna believe — Ayn Rand or your own lying eyes.

Oh, small announcement: I’m traveling tomorrow afternoon and all day tomorrow, then IMFing the rest of the week. Blogging should be light to nonexistent.