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In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. We have printed so mu

In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. We have printed so much money, the only solution is to... print more? It's almost like it is all a sneaky backdoor to letting the government redistribute wealth without real oversight...

groby_b 4y ago
Given that California can't print money, why do you think those checks are "printing money"? And no, it's not a "sneaky backdoor". It's the government doing what it should do, tighten financial inequality gaps. And preventing unnecessary suffering. We're still a society, we occasionally take care of the weaker people amongst us. (Frankly, not often enough) And "without real oversight" is... you're aware this is going through the normal process of fund allocation, is reported widely in the press, and is part of the data that voters can take into account next round, no? It has just as much oversight as any other government spending. (Arguably more than some federal programs) I get that fiscally conservative folks might disagree with this, and we can certainly debate merits. But "printing money" and "without oversight" are empty slogans without basis in fact.
- petilon 4y ago
  They may not be printing money, but they are propping up inflation by giving people free money for compensating for inflation.
  - anon291 4y ago
    Right. One way to combat inflation is to save money. The fed encourages this by increasing the interest rate. If california truly wanted to reduce inflation, it would simply retain those $1000 checks. Taking money out of supply reduces inflation.
    - groby_b 4y ago
      California doesn't want to reduce inflation. (It would be of at least questionable legality, too. Because monetary policy lies with the federal government - Article 1, Section 8) What California does want to do is ensure poorer people aren't bearing the load disproportionately. Also, while we can certainly argue if this is the best use of those funds, a quick reminder that the size of the US money supply is almost 22 trillion. We're about $6T above 2019 levels. California retaining $10B is not going to have any measurable impact on inflation.
  - bigyikes 4y ago
    Yes, people are ignoring the second-order effects. Just because California can’t directly print money doesn’t mean they aren’t contributing to the macroeconomic factors leading to the Fed feeling the need to print more money.
  - imtringued 4y ago
    They can spend the money on things that don't inflate. A tax rebate can only be spent on energy which makes the problem worse.
- commandlinefan 4y ago
  > the government doing what it should do, tighten financial inequality gaps No, that’s really, really not what the government should be doing.
  - andrekandre 4y ago
    what should it be doing?
- imtringued 4y ago
  Nowadays everyone prints money, didn't you read internet comments. If I loan you five dollars I have printed five dollars because the contract we signed counts as a certificate of deposit in the minds of these people.
jedberg 4y ago
It should be noted that California cannot print money. It is simply redistributing what it's residents already have.
wins32767 4y ago
California doesn't print money, the Federal Reserve does. California is required to balance its budget by law, like every state but Vermont. Nearly every state has more money than normal right now (some of it from high tax revenues due to nearly full employment, some due to federal stimulus), so they're finding ways of getting rid of the money. This is a second order effect from the much too large stimulus in 2020/2021.
- Negitivefrags 4y ago
  You would think that there would be something more useful to do with the money, like fixing the infrastructure.
  - pkaye 4y ago
    Any excess taxes above some budget threshold has to be refunded to the public due to some proposition.
  - abstrctComp 4y ago
    Why is stabilizing human beings economic anxiety not useful? What theory of science dictates infrastructure is the best place to spend it? If the answer is none, it’s a purely social policy and you’re spewing politically correct memory. That infra spend is not an immutable law of reality means there are options other than “poison the sky with expansive vanity projects.” Even then, there’s plenty of money for both, and human agency available for both. We can stop pretending money is what drives human invention and discovery. It’s politically correct spoken tradition since it’s not an immutable law; how we feel about other economic choices is a range of possibilities, not just the ones we have been raised to speak of
  - xorfish 4y ago
    Fixing infrastructure is not always useful. Infrastructure for low density suburbs is a money pit that bankrupts cities. Here is a good playlist that explains why this is the case: https://www.youtube.com/watch?v=y_SXXTBypIg&list=PLJp5q-R0lZ0_FCUbeVWK6OGLN69ehUTVa https://www.youtube.com/watch?v=y_SXXTBypIg&list=PLJp5q-R0lZ...
jelliclesfarm 4y ago
yes. even though technically california doesnt 'print money'. people are more important than economy. the 'redistribution' is happening to help the most vulnerable and that's exactly what surpluses should be used for..seems like a good use of money to me.
- buscoquadnary 4y ago
  I hate it when people make it seem like the economy and the people are two different things. The economy is the aggregate capability of a society to provide goods and services to people, if the economy collapses the goods and services that are being provided cease to be as well and people are worse off. Short sighted statements like "people are more important than the economy" is a feel good virtue signaling that is indicative of an inability to think clearly about the consequences of actions and a substitution of emotional reasoning over rational thought.
  - RichEO 4y ago
    This use of the word “economy” in this expression means, “the economy, as commonly measured by GDP”. The economy might be the aggregate production of society, but the distribution of the fruits of that production are not meaningless. Nobody is proposing a return to subsistence farming, but some of us are willing to trade off a higher GDP for more equal distribution.
  - jelliclesfarm 4y ago
    I wasn’t virtue signalling. Over supply of money will make inflation worse, but constriction would bring down spending. A labourer making daily wages and supplemented by govt dollars will spend all of it. A millionaire with a few millions in the bank is not going to spend any of it. Especially during an overheated inflationary period. It’s better spent to the most vulnerable to pay for their food, gas and utilities. This is exactly what needs to be done to keep spending going. It’s spending from a healthy and happy middle class that keeps the economy going. Can’t freeze them out. Not implementing measures like this would collapse the economy. An economy with hopeless disenfranchised hungry poor majority is exactly the first ingredient in the recipe for revolts and revolutions. Also..it’s heartless to not share a surplus to people who are suffering. We are a rich country. No one died because someone else got a little extra money to pay their electricity bill or gas.
RickJWagner 4y ago
Distributing more money is almost certainly unproductive. During Covid large checks were mailed out. Reddit was full of 'casual investors' throwing money at meme stocks that explained it was 'covid money' and thus didn't matter much to them. Student loan debt forgiveness is the latest madness. The end result? Those with the least money (the poor, and those on fixed incomes) are totally hosed. If you can't afford rent at $800, you surely can't afford it at $1400. More handouts only make the problem worse. The Fed's response (raising interest rates) will make cars and houses out of reach for many. Vote for politicians of any party who pledge fiscal responsibility. As a litmus test, judge their reactions to government handouts.
- lmm 4y ago
  > The end result? Those with the least money (the poor, and those on fixed incomes) are totally hosed. If you can't afford rent at $800, you surely can't afford it at $1400. More handouts only make the problem worse. That's absurd; while a one-off is nowhere near as good as a basic income, a flat "handout" benefits the poor for obvious reasons (at the expense of the rich; there's no free lunch). > The Fed's response (raising interest rates) will make cars and houses out of reach for many. Buying cars and houses with money you don't have and hoping you can make up for it in the future is something we never should've normalised. Someone preaching "fiscal responsibility" should see this as a good thing.
  - imtringued 4y ago
    How do you expect fiscal responsibility in an economic system where money both embodies purchasing power which is a stock and liquidity which is a flow? Liquidity is a costly service provided by the public, every open shop and business provides liquidity and operating a business even with no customers costs money. This means anyone holding onto money can force others to spend money on providing expensive liquidity which completely eradicates the concept of fiscal responsibility because the holders of money aren't responsible for paying for the liquidity they benefit from.
    - lmm 4y ago
deleted 4y ago
[deleted]
unity1001 4y ago
> In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. Its not. Its happening in Europe too. Its a way to try to get people through the winter and avoid the energy crisis impacting ordinary people. That's what a government should do - take care of its people during extraordinary times.
- stingraycharles 4y ago
  Yeah in the grand scheme of things, this doesn’t impact inflation all that much, but it does help the people that need it most. Just like increasing the minimum wage to keep up with inflation does. Over the past year businesses have increased their prices all over the board, you can’t then just simply say “but inflation!!” when you want to help the people with some amount of compensation for this.
  - vladimirralev 4y ago
    If you take it just one step further, the people "that need it most" really only need it in order to instantly donate it to the megacorps with pricing power at ever-increasing prices. The handouts help only in that instant and at the very next clock cycle that money is now in the hands of the megacorps. Printing money and handouts only help the top of the top in the pricing power hierarchy. If you want to actually help people you'd be doing taxes on excess. Everything else ends up in gigantic accumulation of wealth at the top in just a few steps down the game.
    - stingraycharles 4y ago
      From that perspective, anything always ends up in the top of the top of megacorps, and I find it not a very compelling argument to not help people just because they’re at the mercy of megacorps. You want to tax these megacorps additionally yes, especially if they’re profiting from the current situation. But at the same time, it’s also important to redestribute that wealth towards those who have the biggest problems right now.
beebmam 4y ago
Wealth is redistributed all the time, it's called taxation.
fulafel 4y ago
Income transfers generally don't imply printing money, they can be funded by eg taxes from a higher income part of population.
deleted 4y ago
[deleted]
abeppu 4y ago
Elsewhere in this subthread I pointed out that California is not printing money; it's spending surplus from 2021. California cannot print money bc we use US dollars and not CA dollars. But I think a more interesting aspect of this is the cynical way language around the same idea has changed. The Franchise Tax Board is calling them a "tax refund", though your "refund" is based on your income being low, rather than your tax bill having been high. But the press has certainly been cooperative in calling them "inflation relief" recently, though the program was planned before inflation rose to the top of so many people's list of concerns. Politically, Newsome wants as much credit as possible for handing back a windfall of taxpayer money that came in mostly because of economic conditions he did not create and taxes that he did not introduce. https://www.ftb.ca.gov/about-ftb/newsroom/middle-class-tax-refund/index.html https://www.ftb.ca.gov/about-ftb/newsroom/middle-class-tax-r...
- 0xy 4y ago
  In this case they're using debt, because while they may have had a surplus in a single calendar year, they're still over $150bn in debt. So it isn't spending surplus, because they're massively underwater and a "profit" is meaningless.
  - KptMarchewa 4y ago
    They are just not overpaying debt, which makes no sense when the rate of outstanding debt is way below inflation.
- gjs278 4y ago
grecy 4y ago
We have printed so much money, the only solution is to... print more? Yes. Once you start printing money to fix problems, you fall into the pit of always needing to print more. See Zimbabwe’s $100 trillion dollar bill. I have one, it makes a great placemat.
Aeolun 4y ago
Giving people a one-time bonus never made sense to me. They’ll feel rich, spend it all, and be back in their previous situation next month.
- atq2119 4y ago
  Sounds like a decent recipe for boosting the economy, assuming the supply side capacity is available: injects a bunch of demand, but at the same time, precisely by being a one-time measure, discourages price hikes.
- m0llusk 4y ago
  Limited available evidence shows that people are extremely conservative with spending windfalls with much of it going to pay down debt.
  - andrekandre 4y ago
    to that point: https://www.reuters.com/article/us-usa-economy-credit-idUSKBN2A52TT https://www.reuters.com/article/us-usa-economy-credit-idUSKB...

groby_b 4y ago

Given that California can't print money, why do you think those checks are "printing money"? And no, it's not a "sneaky backdoor". It's the government doing what it should do, tighten financial inequality gaps. And preventing unnecessary suffering. We're still a society, we occasionally take care of the weaker people amongst us. (Frankly, not often enough) And "without real oversight" is... you're aware this is going through the normal process of fund allocation, is reported widely in the press, and is part of the data that voters can take into account next round, no? It has just as much oversight as any other government spending. (Arguably more than some federal programs) I get that fiscally conservative folks might disagree with this, and we can certainly debate merits. But "printing money" and "without oversight" are empty slogans without basis in fact.

petilon 4y ago
They may not be printing money, but they are propping up inflation by giving people free money for compensating for inflation.
- anon291 4y ago
  Right. One way to combat inflation is to save money. The fed encourages this by increasing the interest rate. If california truly wanted to reduce inflation, it would simply retain those $1000 checks. Taking money out of supply reduces inflation.
  - groby_b 4y ago
    California doesn't want to reduce inflation. (It would be of at least questionable legality, too. Because monetary policy lies with the federal government - Article 1, Section 8) What California does want to do is ensure poorer people aren't bearing the load disproportionately. Also, while we can certainly argue if this is the best use of those funds, a quick reminder that the size of the US money supply is almost 22 trillion. We're about $6T above 2019 levels. California retaining $10B is not going to have any measurable impact on inflation.
- bigyikes 4y ago
  Yes, people are ignoring the second-order effects. Just because California can’t directly print money doesn’t mean they aren’t contributing to the macroeconomic factors leading to the Fed feeling the need to print more money.
- imtringued 4y ago
  They can spend the money on things that don't inflate. A tax rebate can only be spent on energy which makes the problem worse.
commandlinefan 4y ago
> the government doing what it should do, tighten financial inequality gaps No, that’s really, really not what the government should be doing.
- andrekandre 4y ago
  what should it be doing?
imtringued 4y ago
Nowadays everyone prints money, didn't you read internet comments. If I loan you five dollars I have printed five dollars because the contract we signed counts as a certificate of deposit in the minds of these people.

jedberg 4y ago

It should be noted that California cannot print money. It is simply redistributing what it's residents already have.

wins32767 4y ago

California doesn't print money, the Federal Reserve does. California is required to balance its budget by law, like every state but Vermont. Nearly every state has more money than normal right now (some of it from high tax revenues due to nearly full employment, some due to federal stimulus), so they're finding ways of getting rid of the money. This is a second order effect from the much too large stimulus in 2020/2021.

Negitivefrags 4y ago
You would think that there would be something more useful to do with the money, like fixing the infrastructure.
- pkaye 4y ago
  Any excess taxes above some budget threshold has to be refunded to the public due to some proposition.
- abstrctComp 4y ago
  Why is stabilizing human beings economic anxiety not useful? What theory of science dictates infrastructure is the best place to spend it? If the answer is none, it’s a purely social policy and you’re spewing politically correct memory. That infra spend is not an immutable law of reality means there are options other than “poison the sky with expansive vanity projects.” Even then, there’s plenty of money for both, and human agency available for both. We can stop pretending money is what drives human invention and discovery. It’s politically correct spoken tradition since it’s not an immutable law; how we feel about other economic choices is a range of possibilities, not just the ones we have been raised to speak of
- xorfish 4y ago
  Fixing infrastructure is not always useful. Infrastructure for low density suburbs is a money pit that bankrupts cities. Here is a good playlist that explains why this is the case: https://www.youtube.com/watch?v=y_SXXTBypIg&list=PLJp5q-R0lZ0_FCUbeVWK6OGLN69ehUTVa https://www.youtube.com/watch?v=y_SXXTBypIg&list=PLJp5q-R0lZ...

jelliclesfarm 4y ago

yes. even though technically california doesnt 'print money'. people are more important than economy. the 'redistribution' is happening to help the most vulnerable and that's exactly what surpluses should be used for..seems like a good use of money to me.

buscoquadnary 4y ago
I hate it when people make it seem like the economy and the people are two different things. The economy is the aggregate capability of a society to provide goods and services to people, if the economy collapses the goods and services that are being provided cease to be as well and people are worse off. Short sighted statements like "people are more important than the economy" is a feel good virtue signaling that is indicative of an inability to think clearly about the consequences of actions and a substitution of emotional reasoning over rational thought.
- RichEO 4y ago
  This use of the word “economy” in this expression means, “the economy, as commonly measured by GDP”. The economy might be the aggregate production of society, but the distribution of the fruits of that production are not meaningless. Nobody is proposing a return to subsistence farming, but some of us are willing to trade off a higher GDP for more equal distribution.
- jelliclesfarm 4y ago
  I wasn’t virtue signalling. Over supply of money will make inflation worse, but constriction would bring down spending. A labourer making daily wages and supplemented by govt dollars will spend all of it. A millionaire with a few millions in the bank is not going to spend any of it. Especially during an overheated inflationary period. It’s better spent to the most vulnerable to pay for their food, gas and utilities. This is exactly what needs to be done to keep spending going. It’s spending from a healthy and happy middle class that keeps the economy going. Can’t freeze them out. Not implementing measures like this would collapse the economy. An economy with hopeless disenfranchised hungry poor majority is exactly the first ingredient in the recipe for revolts and revolutions. Also..it’s heartless to not share a surplus to people who are suffering. We are a rich country. No one died because someone else got a little extra money to pay their electricity bill or gas.

RickJWagner 4y ago

Distributing more money is almost certainly unproductive. During Covid large checks were mailed out. Reddit was full of 'casual investors' throwing money at meme stocks that explained it was 'covid money' and thus didn't matter much to them. Student loan debt forgiveness is the latest madness. The end result? Those with the least money (the poor, and those on fixed incomes) are totally hosed. If you can't afford rent at $800, you surely can't afford it at $1400. More handouts only make the problem worse. The Fed's response (raising interest rates) will make cars and houses out of reach for many. Vote for politicians of any party who pledge fiscal responsibility. As a litmus test, judge their reactions to government handouts.

lmm 4y ago
> The end result? Those with the least money (the poor, and those on fixed incomes) are totally hosed. If you can't afford rent at $800, you surely can't afford it at $1400. More handouts only make the problem worse. That's absurd; while a one-off is nowhere near as good as a basic income, a flat "handout" benefits the poor for obvious reasons (at the expense of the rich; there's no free lunch). > The Fed's response (raising interest rates) will make cars and houses out of reach for many. Buying cars and houses with money you don't have and hoping you can make up for it in the future is something we never should've normalised. Someone preaching "fiscal responsibility" should see this as a good thing.
- imtringued 4y ago
  How do you expect fiscal responsibility in an economic system where money both embodies purchasing power which is a stock and liquidity which is a flow? Liquidity is a costly service provided by the public, every open shop and business provides liquidity and operating a business even with no customers costs money. This means anyone holding onto money can force others to spend money on providing expensive liquidity which completely eradicates the concept of fiscal responsibility because the holders of money aren't responsible for paying for the liquidity they benefit from.
  - lmm 4y ago

deleted 4y ago

[deleted]

unity1001 4y ago

> In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. Its not. Its happening in Europe too. Its a way to try to get people through the winter and avoid the energy crisis impacting ordinary people. That's what a government should do - take care of its people during extraordinary times.

stingraycharles 4y ago
Yeah in the grand scheme of things, this doesn’t impact inflation all that much, but it does help the people that need it most. Just like increasing the minimum wage to keep up with inflation does. Over the past year businesses have increased their prices all over the board, you can’t then just simply say “but inflation!!” when you want to help the people with some amount of compensation for this.
- vladimirralev 4y ago
  If you take it just one step further, the people "that need it most" really only need it in order to instantly donate it to the megacorps with pricing power at ever-increasing prices. The handouts help only in that instant and at the very next clock cycle that money is now in the hands of the megacorps. Printing money and handouts only help the top of the top in the pricing power hierarchy. If you want to actually help people you'd be doing taxes on excess. Everything else ends up in gigantic accumulation of wealth at the top in just a few steps down the game.
  - stingraycharles 4y ago
    From that perspective, anything always ends up in the top of the top of megacorps, and I find it not a very compelling argument to not help people just because they’re at the mercy of megacorps. You want to tax these megacorps additionally yes, especially if they’re profiting from the current situation. But at the same time, it’s also important to redestribute that wealth towards those who have the biggest problems right now.

beebmam 4y ago

Wealth is redistributed all the time, it's called taxation.

fulafel 4y ago

Income transfers generally don't imply printing money, they can be funded by eg taxes from a higher income part of population.

deleted 4y ago

[deleted]

abeppu 4y ago

Elsewhere in this subthread I pointed out that California is not printing money; it's spending surplus from 2021. California cannot print money bc we use US dollars and not CA dollars. But I think a more interesting aspect of this is the cynical way language around the same idea has changed. The Franchise Tax Board is calling them a "tax refund", though your "refund" is based on your income being low, rather than your tax bill having been high. But the press has certainly been cooperative in calling them "inflation relief" recently, though the program was planned before inflation rose to the top of so many people's list of concerns. Politically, Newsome wants as much credit as possible for handing back a windfall of taxpayer money that came in mostly because of economic conditions he did not create and taxes that he did not introduce. https://www.ftb.ca.gov/about-ftb/newsroom/middle-class-tax-refund/index.html https://www.ftb.ca.gov/about-ftb/newsroom/middle-class-tax-r...

0xy 4y ago
In this case they're using debt, because while they may have had a surplus in a single calendar year, they're still over $150bn in debt. So it isn't spending surplus, because they're massively underwater and a "profit" is meaningless.
- KptMarchewa 4y ago
  They are just not overpaying debt, which makes no sense when the rate of outstanding debt is way below inflation.
gjs278 4y ago

grecy 4y ago

We have printed so much money, the only solution is to... print more? Yes. Once you start printing money to fix problems, you fall into the pit of always needing to print more. See Zimbabwe’s $100 trillion dollar bill. I have one, it makes a great placemat.

Aeolun 4y ago

Giving people a one-time bonus never made sense to me. They’ll feel rich, spend it all, and be back in their previous situation next month.

atq2119 4y ago
Sounds like a decent recipe for boosting the economy, assuming the supply side capacity is available: injects a bunch of demand, but at the same time, precisely by being a one-time measure, discourages price hikes.
m0llusk 4y ago
Limited available evidence shows that people are extremely conservative with spending windfalls with much of it going to pay down debt.
- andrekandre 4y ago
  to that point: https://www.reuters.com/article/us-usa-economy-credit-idUSKBN2A52TT https://www.reuters.com/article/us-usa-economy-credit-idUSKB...