Dr. Martin Hash Podcast

Politics & Philosophy by Dr. Martin D. Hash, Esq.

77 Inflation


U.S. government debt cannot be reconciled. The Debt itself, ~$18 trillion, isn’t nearly as impossible as government pension obligations which are $24 trillion, Medicare which is $42 trillion, and Social Security, another $21 trillion. There are 116 million American households and about half pay taxes so each taxpaying household is on the hook for approximately $2 million dollars, a lifetime of earnings for most people. The only obvious solution is inflation: 1000% over 3 years, about 7% per month, and if it was a gradual increase, it wouldn't catch people by surprise. Also, during that time of upheaval would be an opportunity for political action, including a Balanced-Budget Amendment, and making taxes more progressive.

Who gets hurt by high inflation? Companies that loan money, high-end pensioners, and people with cash in the bank. Inflation is essentially a transfer of wealth from those who lend money to those who borrow it, while the poor are mostly unaffected. Social Security & healthcare are indexed to inflation, so those people will be safe. Retirees would be the biggest losers but by definition, they consume more than they produce, and retirees are usually the people who benefited from the debt in the first place so inflation consuming their savings is somewhat karmic. America has many mechanisms to delay the onset of inflation, but it's not a matter of if, only a matter of when?

Categories | PRay TeLL, Dr. Hash


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