It’s a real question. If you had to choose between #1. Inflation or #2. Sickness, A Recession, A Depression, Poverty, Illiteracy, Starvation, Homelessness, Crime and some other bad stuff I could mention, would you chose #1 or #2? It may sound like a no-brainer, and perhaps it is in the literal sense of “no brain,” because the vast majority of Americans claim they would rather experience #2 rather than #1. Do you agree that you would prefer to experience sickness, a recession,  a depression, poverty, illiteracy, Starvation, Homelessness, Crime, etc. than to experience inflation? Let’s begin with the generally uncontested fact that the federal government created the laws that created the U.S. dollar. Because  the federal government can create any laws it wishes, it can create as many dollars as it wishes, and cannot unintentionally run short of dollars. The experts agree:

Former Fed Chairman, Alan Greenspan: “The United States can pay any debt it has because we can always print the money to do that.” Former Fed Chairman, Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”

We could add to the discussion the fact that federal deficit spending does not cause inflation, which we have proved here and here and dozens of other places on this blog. We could insist that shortages cause inflations, and those shortages can be cured by federal deficit spending. Thus, we can show that rather than causing inflations, federal deficit spending can cure inflations.

But, wait. Why struggle against a tide of misinformation? Let’s assume, for the sake of argument, that federal deficit spending does indeed, cause inflation. It’s what most Americans believe. Because the federal government can’t run short of its own sovereign currency, it could risk inflation by using that currency to pay for:

1. Comprehensive, generous Medicare insurance for every man, woman, and child in America
2. Generous Social  Security benefits for every man, woman, and child in America, regardless of age, income, or wealth
3. All costs of education from K-12 and beyond, including advanced degrees from top universities
4. Rent and other housing subsidies, for all.
5. A healthful diet for all Americans
6. Subsidies for all states, counties, cities, and villages, so that none of them would have to levy taxes.
7. Ending the FICA deduction from salaries
8. Expanded research in all the sciences: Mathematics, Biology, Botany, Social Sciences, Philosophy, Geology, Physics, Chemistry, Astronomy, and all the other sciences not mentioned.

The purpose of such spending would be to improve and extend the lives of humans and the other living creatures with whom we share the earth. The government has the ability to fund all of #1 through #8. But many people wrongly object, “But that would cause inflation.” If those people were correct, and that spending would cause inflation, it only would mean they have chosen a lesser life rather than experience inflation. They have chosen sickness rather than health, poverty instead of affluence, taxation rather than being tax-free, homelessness rather than sheltered, stagnancy rather than advancement, and ignorance rather than knowledge, all for the fear of inflation. Would you rather suffer from incurable, painful disease than suffer from inflation? Would you rather risk being impoverished and homeless than to risk inflation? Would you prefer that your children be unable to attend the best colleges having the best resources money can buy, just so you don’t see prices rise? Would you rather the type of research that amazed you with the Internet, cell phones, artificial intelligence, moon landings, etc. be discontinued for lack of funds, just so inflation can be avoided? Would you prefer that America default on its debts by enforcing a debt ceiling? Would you rather that the federal government cease to improve our military? Would you rather see the government do nothing to prevent or cure recessions and depressions, just because the cure – federal deficit spending – might cause inflation? In summary, even if we admit the belief, just for the sake of argument, that federal spending causes inflation, we are left with very unsavory alternatives. Think about it. Do you really believe that the possibility, or even the false probability, that federal deficit spending could cause inflation is more important than all of the things federal money could buy?

  Rodger Malcolm Mitchell Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

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The Sole Purpose of Government Is to Improve and Protect the Lives of the People.

MONETARY SOVEREIGNTY