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Why shouldn't inflation be considered a tax? It's a major reason for lack of social mobility, i.e. keeping the poor poor without them even knowing it. The end r
by throwaway3699 5y ago
Why shouldn't inflation be considered a tax? It's a major reason for lack of social mobility, i.e. keeping the poor poor without them even knowing it. The end result is the dollars end up in government pockets, so what's the difference?
- vmception 5y agoInflation has a mixed effect on the governments too. Municipal governments are affected the same as you are. And the federal government which issues the currency is also mostly adversely affected while marginally helping it (and all borrowers) defer paying off its debt. The additional money in its coffers is from its own creation* and doesnt help it purchase more (for long) as it has the same purchasing power and liquidity in the global market. Its revenue sources, which are mostly tax these days, are distinctive from inflation. *us treasury issues USD bonds, fed buys USD bonds from everyone including the us treasury creating new USD at the moment of transaction. Sometimes the US treasury is the recipient, other times the other investors are