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Exactly! And inflation is just another form of taxes.

bitumen 9y ago
A very pernicious form which disproportionately harms the middle and lower classes. I’ve never understood hard left thinks this kind of thing is a good idea. I understand wanting to change gross inequality and reject runaway capitalism, especially the rigged cronyism we see today. Choosing to change things by engaging in failed alternatives though seems crazy. I’m not being rhetorical, I don’t understand. If someone can explain it to me, or point me to some good explanations I’d appreciate it.
laurencerowe 9y ago
Inflation is a tax on wealth but not income (which rises with inflation.) As such it’s a progressive tax since wealth is so unequally distributed. Close to two decades of low inflation in the US and Western Europe has greatly increased inequality. Hyperinflation is destructive and must be avoided but there’s a strong progressive case for increasing the 2% inflation targeted by most central banks.
- giggles_giggles 9y ago
  5% of the value held in the bank account of a poor person is worth more to that person than 5% in the account of a wealthy person, even if the absolute amount is less. Inflation is one of the most regressive taxes.
  - pjc50 9y ago
    For less well off people the effect of inflation matters far more in terms of cash flow - pay and expenses - than cash holdings.
- conanbatt 9y ago
  Grotesque. Inflation is a tax that is first spent by the government, from the government to governments interests. Its a terrible tool of wealth distribution, and to the extent that it behaves like one it redistributes from everyone into the pockets of those who get the money first.
- lainga 9y ago
  >income (which rises with inflation) At least up here in Canada, inflation-adjusted wage growth has been negative in the past two years.
- prostoalex 9y ago
  > Inflation is a tax on wealth Part of wealth that's stored in cash or fixed-rate debt instruments. Most other assets - real estate, equities, floating-rate debt instruments - adjust accordingly.
- tzahola 9y ago
  Lol. Inflation is taxation only for those who can’t afford to invest their “wealth” in assets like real estate. How progressive!
- ucaetano 9y ago
  > Inflation is a tax on wealth but not income (which rises with inflation.) Not really. Inflation is a tax on those who don't have access to inflation-adjusted returns. If inflation is steady, wealth isn't taxed. But unexpectedly increasing inflation is a tax on wealth.
- deleted 9y ago
  [deleted]
- danans 9y ago
  More specifically, unanticipated inflation is a "tax" to creditors (usually wealthier) who have invested loans and a benefit to their debtors (usually less wealthy). From https://www3.nd.edu/~cwilber/econ504/504book/outln13c.html https://www3.nd.edu/~cwilber/econ504/504book/outln13c.html "One important redistribution of income and wealth that occurs during unanticipated inflation is the redistribution between debtors and creditors. a. Debtors gain from inflation because they repay creditors with dollars that are worth less in terms of purchasing power."

A very pernicious form which disproportionately harms the middle and lower classes. I’ve never understood hard left thinks this kind of thing is a good idea. I understand wanting to change gross inequality and reject runaway capitalism, especially the rigged cronyism we see today. Choosing to change things by engaging in failed alternatives though seems crazy. I’m not being rhetorical, I don’t understand. If someone can explain it to me, or point me to some good explanations I’d appreciate it.

laurencerowe 9y ago

Inflation is a tax on wealth but not income (which rises with inflation.) As such it’s a progressive tax since wealth is so unequally distributed. Close to two decades of low inflation in the US and Western Europe has greatly increased inequality. Hyperinflation is destructive and must be avoided but there’s a strong progressive case for increasing the 2% inflation targeted by most central banks.

giggles_giggles 9y ago
5% of the value held in the bank account of a poor person is worth more to that person than 5% in the account of a wealthy person, even if the absolute amount is less. Inflation is one of the most regressive taxes.
- pjc50 9y ago
  For less well off people the effect of inflation matters far more in terms of cash flow - pay and expenses - than cash holdings.
conanbatt 9y ago
Grotesque. Inflation is a tax that is first spent by the government, from the government to governments interests. Its a terrible tool of wealth distribution, and to the extent that it behaves like one it redistributes from everyone into the pockets of those who get the money first.
lainga 9y ago
>income (which rises with inflation) At least up here in Canada, inflation-adjusted wage growth has been negative in the past two years.
prostoalex 9y ago
> Inflation is a tax on wealth Part of wealth that's stored in cash or fixed-rate debt instruments. Most other assets - real estate, equities, floating-rate debt instruments - adjust accordingly.
tzahola 9y ago
Lol. Inflation is taxation only for those who can’t afford to invest their “wealth” in assets like real estate. How progressive!
ucaetano 9y ago
> Inflation is a tax on wealth but not income (which rises with inflation.) Not really. Inflation is a tax on those who don't have access to inflation-adjusted returns. If inflation is steady, wealth isn't taxed. But unexpectedly increasing inflation is a tax on wealth.
deleted 9y ago
[deleted]
danans 9y ago
More specifically, unanticipated inflation is a "tax" to creditors (usually wealthier) who have invested loans and a benefit to their debtors (usually less wealthy). From https://www3.nd.edu/~cwilber/econ504/504book/outln13c.html https://www3.nd.edu/~cwilber/econ504/504book/outln13c.html "One important redistribution of income and wealth that occurs during unanticipated inflation is the redistribution between debtors and creditors. a. Debtors gain from inflation because they repay creditors with dollars that are worth less in terms of purchasing power."