Re: Refuting supply-side economics

royls_at_telus.net
Date: 09/28/04 

Date: Tue, 28 Sep 2004 19:22:12 GMT

On Mon, 27 Sep 2004 18:14:42 GMT, William F Hummel
<wfhummel@comcast.net> wrote:

>On Mon, 27 Sep 2004 18:04:51 GMT, royls@telus.net wrote:
>
>>On Sun, 26 Sep 2004 17:37:19 GMT, William F Hummel
>><wfhummel@comcast.net> wrote:
>>
>>>In that same period, Treasury spending totaled 10,140 billion, about
>>>two orders of magnitude greater. Now let's suppose the no taxes were
>>>collected or bond sales made during that five-year period. The
>>>economy would be so flooded with currency and bank reserves that the
>>>inflation rate would have ballooned out of sight. Can you say
>>>"hyperinflation."
>>>
>>>And you can bet that the average worker is the one who would suffer
>>>most.
>>
>>No, the historical examples of hyperinflation prove that claim is
>>false. For workers it is annoying; but those who own lots of currency
>>and currency-denominated assets lose everything.
>>
>Nope.

Yep. You're just flat wrong as a matter of historical fact.

>During hyperinflation, wages lag prices and workers have to
>struggle to put food on the table.

?? Wrong. Of course there are dislocations and shortages, but you
seem to be unaware that the inflated prices are typically _going_ to
the same sorts of people who are paying them. It is those whose
incomes and assets are tied to the currency who lose the most by
inflation and hyperinflation, not working people who can either get
higher wages or go to work elsewhere. Every single historical case of
hyperinflation bears this out: workers survive, but creditors are
exterminated.

>Few of the wealthy keep lots of
>currency in an inflationary environment.

ROTFL!! Few people ever keep lots of currency, but it's a cinch
working people don't: they haven't got the money.

The fact remains, it's money owners and creditors -- those who have or
are owed money -- who lose most by hyperinflation, not average workers
(who often _gain_ by having their debts cancelled).

-- Roy L

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