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The reason you can't just print up some money on the office copier is because it reduces the value of all other money. What this means is that money isn't private property, but a form of public commons, just like the road system. What is happening with our economic system is a version of the tragedy of the commons, as it is abused by the few, to the detriment of the many.
It would be one thing if the tax cuts for the rich had some greater long term effect, but all that extra wealth is only creating inflation in the stock markets. Everything being relative, if the value of the underlaying assets are not going up, than the value of the investment capital is going down. Only as much wealth can be saved as can be effectively invested. The economic engine is the borrower, the fuel tank is the lender. Order is top down, but growth is bottom up.
Society is like any structure. It has its levels, with a base larger than the top, but we can't skimp on the foundation to put more gold fixtures in the penthouse, or it will all fall down, rich, poor and everyone else inbetween. We need to be investing in the health and education of the next generation of citizens, not burning the wealth up in a stock market blow off.
A historical footnote: Paul Volcker is credited with curing the inflation of the seventies by tightening the money supply and raising interest rates. Inflation is caused by the money supply growing faster than the economy, so it would seem sensible to cure it by slowing the growth of the money supply. The problem is that higher interest rates don't affect those with the extra money to lend, but those wishing to borrow it. So the question is; How do you cure an over-supply by slowing demand? Logically, you don't, so how is it that inflation faded? Could it have been that government debt was quickly ramping up to two hundred billion a year? Not only would it absorb the surplus capital, but government spending generally supports private sector investment, so the effect is multiplied. What is the logic here? The blame is placed on those wanting more for their efforts, like the air traffic controllers, while the surplus wealth is effectively nationalized, with an IOU to be drawn from taxpayers.
Regards,
John Brodix Merryman Jr.
Sparks, Maryland
It would be one thing if the tax cuts for the rich had some greater long term effect, but all that extra wealth is only creating inflation in the stock markets. Everything being relative, if the value of the underlaying assets are not going up, than the value of the investment capital is going down. Only as much wealth can be saved as can be effectively invested. The economic engine is the borrower, the fuel tank is the lender. Order is top down, but growth is bottom up.
Society is like any structure. It has its levels, with a base larger than the top, but we can't skimp on the foundation to put more gold fixtures in the penthouse, or it will all fall down, rich, poor and everyone else inbetween. We need to be investing in the health and education of the next generation of citizens, not burning the wealth up in a stock market blow off.
A historical footnote: Paul Volcker is credited with curing the inflation of the seventies by tightening the money supply and raising interest rates. Inflation is caused by the money supply growing faster than the economy, so it would seem sensible to cure it by slowing the growth of the money supply. The problem is that higher interest rates don't affect those with the extra money to lend, but those wishing to borrow it. So the question is; How do you cure an over-supply by slowing demand? Logically, you don't, so how is it that inflation faded? Could it have been that government debt was quickly ramping up to two hundred billion a year? Not only would it absorb the surplus capital, but government spending generally supports private sector investment, so the effect is multiplied. What is the logic here? The blame is placed on those wanting more for their efforts, like the air traffic controllers, while the surplus wealth is effectively nationalized, with an IOU to be drawn from taxpayers.
Regards,
John Brodix Merryman Jr.
Sparks, Maryland