Friday, November 12, 2010

Why the Move to Jump-Start the Economy With Inflation Now

Is there, in fact, going to be a massive inflation of the currency?

Well, if you believe Sarah Palin, yes.

But, of course, she's a dummy, isn't she?  Where could she have possibly gotten that idea?

From the newspaper of the reporter questioning her understanding and knowledge of economics, of course.

I think this is what my son would call a Boo-Yah! moment.

But, why would inflation be such an unmitigated disaster for the American public.

On this, I have some expertise.  I lived through the inflation of the 1970s.  It was dreadful.  It eroded buying power, and made strikes near-constant.  Why?  Because the unions' members couldn't manage on  wages previously adequate.

The higher wages resulting from those strikes led to higher prices - and, inevitably, to calls for increased wages.  For union members, it was a cycle without end.  For those who didn't belong to a union, it was a nightmare - our bosses had trouble meeting wage demands of unions, and they did so by keeping our wages stagnant.

So, is the solution to join a union?

Please.

I've belonged to several unions, and each was more inefficient, more top-heavy with either corruption or socialists (sometimes, sadly, both) than any Kremlin politbureau.  I always looked at the deduction taken out of my paycheck as wasted money.  At that time, I worked for "closed shop" businesses.  Either join, or pay almost the same, but without membership - it made little difference.

Inflation does increase the value of homes, it's true, but at a terrible cost - savers find their efforts to be a waste, and retirees find that the value of their pension shrinks to almost nothing.  An inflationary economy encourages over-spending, going into debt, and living for today.

None of those are admirable character traits.

All of those traits developed in the generation that reached adulthood in the 1970s; those would be baby-boomers.  Is it any wonder that so many are "adults" of little personal character?



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