Rick Perry on supply and demand economics: Supply it, then demand will follow
Secretary of Energy Rick Perry sparked disbelief on Twitter Thursday after he tried to offer an economics lesson while touring a coal plant in West Virginia.
"Here's a little economics lesson: supply and demand. You put the supply out there and the demand will follow," Perry said, responding to a question about a shale gas boom in comments captured by S&P Global Market Intelligence reporter Taylor Kuykendall.
"The market will decide which of these — they're going to pick and choose," Perry continued at Longview Power Plant. "I mean, that's really pretty simple. All too often, you have in the last eight years, you have an administration that was over here putting its thumb on the economic scale as well as the technology scale because they said this is where we want to go."
A reporter attempted to ask a follow-up question about the prevalence of shale gas, which Perry called a "good thing," before West Virginia's Democratic Sen. Joe Manchin took over the question.
It isn't entirely clear what Perry meant -- and the Department of Energy did not respond to a request for clarification -- but Perry's definition of supply and demand does not match the long-held economic theory that describes the interaction between the supply and the demand of a product or service. The gist of the theory is, if the supply for a product is low but its demand is high, the product's price is likely to increase. If a product's supply is high and the demand for a product is low, however, the product's price is likely to drop.
Perry may have been referencing Say's law of markets, an economic theory that argues supply is the origin of demand.
Perry's stop at the power plant was a part of a tour of energy production and research sites in West Virginia, his first official visit to the state Mr. Trump won by the largest margins.
