3 ms·
As others have pointed out, not hyperinflation. Hyperinflation requires a pathologically broken central government. One of the things that prevents that from ha
by wahern 8y ago
As others have pointed out, not hyperinflation. Hyperinflation requires a pathologically broken central government. One of the things that prevents that from happening in the U.S. is that the Federal Reserve is a quasi-public institution with a fixed mandate--low unemployment, moderate inflation. (Why moderate? Because a small amount of inflation incentivizes investments and consumption by preventing people from sitting on cash.) But it would be naive to say that the U.S. could never get there.
The bulwark that protects the Federal Reserve has been steadily attacked from the right since the financial crisis. The GOP almost revolted against Bush for the bail-out, and because the government was slow to respond and did so anemically the Federal Reserve stepped into the void with massive infusions of cash. This resulted in cries for the Federal Reserve's independence to be diminished. Such opponents were never forced to reconcile with the fact that the Federal Reserve saved our bacon.
Elsewhere, on both the left and right, you have the constant reminders that fiscal debt can be "fixed" by inflating away the debt. If our political culture continues to internalize that notion then at some point when things become more dire we may actually attempt it. But in as much as it's a viable approach, it could only possibly work from a position of fiscal and monetary strength, a position we would surely not be in were we seriously contemplating it.