%22Plant a WIN garden%22 button.JPG
(Image by Wikipedia (commons.wikimedia.org), Author: Author Not Given) Details Source DMCA
In 1974, US president Gerald Ford declared inflation "public enemy number one" and launched a public relations campaign against it. WIN ("Whip Inflation Now") buttons were handed out. The administration suggested various ways of "whipping inflation," such as carpooling and home gardening. It didn't work. Double-digit inflation outlived the Ford administration by several years.
Nearly five decades after Ford's failed PR project, big-time inflation is back, along with the same professed ignorance of its cause from politicians and government officials, and their same obfuscation as to what inflation even actually is.
There's a reason for that professed ignorance: In the United States, at least since 1913, government policy is the cause of inflation, full stop.
The obfuscation usually takes the form of describing rising prices as "price inflation." But rising prices aren't inflation. They're the effect of inflation.
Inflation, simply put, is an increase in the supply of money versus the goods and services available for purchase. When there's more money chasing fewer things to buy, prices go up, just like they do at an auction when more bidders with fatter wallets show up hoping to grab themselves one of Jerry Garcia's guitars.
Yes, it really is that simple.
Inflation doesn't HAVE to be caused by government, by the way. If we were using gold or silver as money and some mining outfit discovered a vein of one of those metals, dug it up, and quickly doubled the amount in circulation, that would be inflation too.
Such concerns were among the reasons cited for creating the Federal Reserve -- a pseudo-private banking cartel -- in 1913. Instead of leaving the supply of money to the seemingly random wanderings of markets, Congress handed its authority to "coin money" and "regulate the value thereof" over to the Fed, which now creates "money" by, essentially, waving a magic wand.
In theory, the Fed balances the supply of money (as "Federal Reserve Notes") with production so as to minimize inflation. But in reality, whenever Congress decides to use its power to "borrow money on the credit of the United States," the Fed waves that magic wand and creates more.
Over the last year or so, a LOT more.
In the last 18 months, the US "M2" money supply (coin currency, physical paper, central bank reserves, demand deposits, travelers' checks, savings deposits and money market shares) has increased from about $15.4 trillion to nearly $20.4 trillion.
That's a 24% increase, annualizing to an inflation rate of about 16% -- if production of goods and services kept up. But it didn't. US Gross Domestic Product dropped from more than $21.4 trillion in 2019 to less than $20.1 trillion in 2020.
Inflation is a hidden tax. Instead of hitting you up for a dollar or ten, the government just makes that $100 bill in your wallet worth $99 or $90 in terms of what you can buy with it now as opposed to what you could buy yesterday.
The only way to "whip" politically created inflation is to separate money and state. Which explains why the American political class is scared witless by cryptocurrency.