STEVE FORBES ON HIGH OIL PRICES,

Commodities like oil are priced in dollars. So when the dollar becomes weak, the dollar price of commodities goes up. And when the greenback is strong, the dollar price of commodities goes down.

In 2004 Alan Greenspan, Chairman of the Federal Reserve, made a fateful miscalculation. The maestro, as he was then affectionately called by an adoring media, miscalculated the strength of the U.S. economy. He thought it weak. He was fearful that prices would collapse in America as they did in Japan during the 1990s and the early part of this decade. So to goose the economy, Greenspan created excessive amounts of money. Interest rates were kept artificially low.

But the economy was not weak. In fact, between 2003 and the summer of 2007, the growth alone of the U.S. economy exceeded the entire size of the Chinese economy. In other words, we grew the equivalent of the economy of China in little more than four years.

Yet Greenspan made sure the Fed's printing presses worked overtime. Thus for the first time since the 1970s and early 1980s, we are faced with a serious inflation problem. Thanks to Greenspan's blunder, all commodities shot up -- oil, cooper, lumber, steel, even the price of mud.

While Greenspan begat the inflationary blunder, Ben Bernanke, the maestro's successor, perpetuated it. In 2003 the price of oil was around $25 a barrel. A year ago when the credit crisis hit, oil was around $70. Then Bernanke ginned up the printing presses again, this time to deal with the fallout of the busts of sub prime mortgages and other exotic financial instruments and the threats they posed to the banking system. The U.S. economy has crawled to a virtual halt since August 2007 and yet the price of oil has almost doubled. That's not supply and demand, that's classic inflation.