Lately, it is common for conservatives and Republicans to cite federal spending as the cause of the massive inflation that threatens to destroy the American economy.
While it is certainly true that this reckless spending is the driver of our economic woes, I challenge the concept’s validity.
This assertion suggests that the problem begins with overspending and that inflation is a byproduct of overspending.
Inflation has been successfully redefined to be the relationship of resources to goods and services.
This ignores the true or original understanding of the meaning of “economic inflation.”
I have a Funk & Wagnalls New College Standard Dictionary, CR 1950
In the definition of “inflation” it says in the related portion;
“3. Expansion or extension beyond natural or proper limits or so as to extend normal or just value; specifically, over-issue off currency, or the state resulting therefrom; also, increase of price levels arising from general increase in expenditures without corresponding increase in commodities.”
In the last phrase of this definition, we see represented the concept propounded by Milton Freedman as to the common understanding of inflation.
This suggests that inflation is a product of the free market, even though Freedman himself often said that “only government can cause inflation.”
This is unfortunate since the preceding section of definition #3 tells us that it is the expansion of currency, or fiat currency, that “IS” inflation. Even this definition ignores that the reason that fiat currency IS inflation is that it sanctions the theft of wealth from the producers by “money changers.”
This definition was once widely known and commonly understood, leading to its representation in Article I, sections 8 & 10 of the US Constitution.
The statements, “Federal spending leads to inflation,” and “We must cut federal spending to reduce inflation,” are products of the misconception that fiat currency is not the embodiment of inflation.
If America is ever to bring federal spending under control, it will only be through the elimination of fiat currency.
Elon Musk and the DOGE are doing great work revealing the exploitation of fiat currency, but without eliminating the “carrot,” no “stick” will ever be successful in the elimination, or even control of inflation.
The last part of definition #3 is a function of the “free market.” It will always police itself. The natural laws of economics are like gravity, they need no oversight. It is the incentive of “free money” that enables and incites bad behavior and uncontrolled federal spending.
Read more on inflation at my SubStack:
https://daveclandry.substack.com/p/inflation-21c?utm_source=publication-search
God bless you, Dave
“Any power that government takes from the people, it will never return voluntarily.
Every power that government takes will ultimately be abused to the maximum extent possible.
Nobody ever complied their way out of totalitarianism, the only thing we can do is resist.”__Robert Kennedy jr.