Writer Responds to Byoungho Jang’s Economics Column on Inflation

Writer responds to Byoungho Jang’s economics column on inflation

To the editor: In response to international student Byoungho Jang’s comments about inflation in the Oct. 23 edition of The Call, there will always be price fluctuations due to changes in supply and demand, but ongoing inflation isn’t a case of merchandise being more valuable or scarce. It’s because the value of our money is decreasing. The dollar is being devalued by an economic partnership between the federal government and the Federal Reserve …

Government Deficits Don’t Cause Inflation or Higher Interest Rates

Government budget deficits are bad things and we’d love to see the budget balanced. But one of the lessons we learned in the 1980s was that government deficits do NOT cause higher inflation or higher interest rates. The deficits went up and yet the interest rates and inflation came WAY down. This chart is a useful reminder: How can that be? Because it is not government BORROWING but government SPENDING that crowds out private savings and product…