Inflation: The Greatest Scam Known to Man

Inflation is a spook invented by the wealthy elite to keep the working man down and devalue his efforts from under him. It's an excuse to stealthily pay him less for the exact same work, and claim that nothing has changed, despite the fact that his rent now takes a bigger percentage of his paycheck, and he isn't able to afford healthy nutritious meals for his family. 

His purchasing power is eroded by a combination of increasing prices and stagnating wages. Since this is a function of "the economy" and not his employer, they get to throw their hands up and say "sorry pal maybe you should have worked harder". The worker is bamboozled by all of this, concludes that all of these “smart people” must know what they’re talking about, and therefore he alone must be to blame for his predicament. This is far from the case, not that he will ever know.

In real terms (purchasing power), the worker is paid less and less on one side, while companies continually raise their prices to meet inflation on the other. If the worker ever manages to get a raise then the boss needn't worry for too long because inflation means that that worker will soon go back to being underpaid, unless the government matches minimum wage growth to inflation, virtually guaranteeing a stable transfer of purchasing power from employer to worker. They they won't do it, by the way, because then the worker will be able to attain a decent quality of life, dream of taking holidays, and other such frivolous nonsense that does not benefit the corporate ruling class.

What is inflation?

"A continual increase in the price of goods and services" is probably the purest explanation you'll find outside of the Ivy League. What does that mean, though? It means that, next year, and indeed every year, things will be more expensive than they have been in the previous years. This growth isn't linear though - it's exponential. Inflation is a growth in prices of about 1-2% per year. That means this year’s growth is greater than last year’s growth, and next year’s growth will be bigger than this year’s growth, and so on, until an increase of $10 for a bottle of milk from one year to the next won’t even make you blink. That's the power (or curse) of exponential growth. Prices can start rising by a few cents per year but even a $100 increase in one year is inevitable.

Ever wonder why some countries had their equivalent of a 1 cent, and even a 1/2  cent coin, but they’ve been long since phased out? Inflation is the culprit. 1 cent once represented significant purchasing power, but today, in countries that still have 1 cent coins, some people don’t even bother picking change off of the counter if it amounts to a few cents. That is the inevitable fate of even the 1 dollar coin (or bill). You can go and see the power of the dollar eroding on websites like Official Data. In 1800, one single dollar had the purchasing power of twenty of our dollars, meaning that what costs $20 today - a haircut, a bus ride, a movie ticket - only cost a single dollar in the early 1800s. 

Pay more for the same thing and call it “progress”

Now imagine that. What cost $1 now costs $20. Has the amount of good or service risen by 20 times? Does the bus take you twenty times as far? Does the barber cut your hair twenty times as fast, or as well? Clearly not, and yet these things cost twenty times as much all the same. Now why is this? What reason could there be that can justify such horrendous price increases?

Some might say that it doesn't matter that prices rise because wages rise along with them, creating equilibrium. Well, if equilibrium would exist anyway, why not keep all prices where they are instead of partaking in this pointless rat/arms race between wages and prices? That's the rub. It's by design. Why make things simple, and thereby the workers content, when you can introduce a system that keeps them working as hard as they can to simply stay where they are? It allows the creation of convenient excuses for cutting wages of the working class.

Excuses: Meet ‘armchair economics’

The classic retort to any assertion that inflation is anything but righteous and true, is that prices have gone up because more money has been created and therefore each existing unit of currency is now worth that much less. This is nothing but yet another argument in a long line of arguments that make sense only if you accept them at face value. Of course my dollar is worth less now that there are more dollars; the last bottle of water in the country is worth more than it's weight in gold, but if a truck of water shows up then that bottle is suddenly worth much less. See? Same thing! Only it isn't. currency isn’t a product, it’s the thing that we exchange for products. Why is it governed by the same rules that govern products? Ask that simple question, and the whole idea falls flat on its face.

Inflation nerds will then try to convince you that inflation is an inherent byproduct of the capitalist system, as if it's a inarguable rule of the universe that prices rise over time as an economy grows. Shrewd players will notice that our entire modern way of life is made up. Nothing "just exists". Stuff happens because people make it happen, usually for their own selfish reasons. You're telling me that inflation is some mystical force that infects our financial systems and no-one can do a thing to stop it? Come on! Inflation, just like anything else, is something that humans just made up. Only the unthinking fool actually believes in these things as a staple of life. They aren't! It's all made up! There's no reason the governments around the world can't come together and agree that inflation is a bad idea and that prices are just fine where they are right now. No reason at all.

Again, inflation isn't a law of the universe, it's a man-made construct that people believe in because they've bought too far into the idea that things exist within our society simply because they ought to exist. The reality is that it's all made up by people no smarter than you or me.

Next, you'll hear that inflation is actually a good thing because it prevents people from hoarding money. First off, news flash: We already have people like that. They're called billionaires (but they don't hoard cash technically so I guess we can have fun watching the middle-class billionaire-defenders cry that Jeff Bezos isn't getting a fair go). Also, I don't think that a good answer to the 'some people will have too much money' problem is to make sure that most people have as little purchasing power as possible. Why do proponents of inflation want to stop people from having purchasing power? Are the proponents of inflation actually communists? The main draw of capitalism is that anyone can get ahead and have a good life if they work hard. Now these people want to say "nerts" to that and take away purchasing power that has been rightfully and fairly earned. Not only that, they want to put the decision for fair wages in the hands of the corporation - an entity that seeks to minimize wages and maximize profit at the expense of all else.

So don't let anyone try to convince you of the virtues, necessity, or inevitability of inflation. It's a con designed to keep the working man down, and reliant on his employer. People make all sorts of excuses as to why inflation is a good and right thing, but isn't a good thing, and it sure as hell isn't an unavoidable byproduct of economic activity. Corporations use in as an excuse to silently cut their employees' pay, and governments around the world could put a stop to it if they had incentive to do so. Don't believe otherwise. It’s far to convenient to be a coincidence.