The most important thing to remember is that inflation is not an act of God; inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy — a deliberate policy of people who resort to inflation because they consider it to be a lesser evil than unemployment. But the fact is that, in the not very long run, inflation does not cure unemployment.
Inflation is a policy. And a policy can be changed. Therefore, there is no reason to give in to inflation. If one regards inflation as an evil, then one has to stop inflating. One has to balance the budget of the government. Of course, public opinion must support this; the intellectuals must help the people to understand. Given the support of public opinion, it is certainly possible for the people’s elected representatives to abandon the policy of inflation.
We must remember that, in the long run, we may all be dead and certainly will be dead. But we should arrange our earthly affairs, for the short run in which we have to live, in the best possible way. And one of the measures necessary for this purpose is to abandon inflationary policies.—
Ludwig von Mises (1881 -1973), “Economic Policy: Thoughts for Today and Tomorrow”
Though this may be entirely true, and I do believe it to be so, the problem is that many of our ivory-tower intellectuals see things differently and the government now stands to profit through inflation. Indeed it is dependent now upon inflation for survival. It hopes to pay off much of its debt with inflated dollars that are worth less and less (as will be those in all our wallets.) Don’t look to our government to counter inflation now. It won’t do it. That would be tantamount to political suicide. What the government accomplishes through the maneuvers of the Federal Reserve (ostensibly not a part of the government but the government could not wage war without its actions) must be looked upon as levying a stealth tax. Because that in fact is what it is.