A Quote by Henry Hazlitt
If a government resorts to inflation, that is, creates money in order to cover its budget deficits or expands credit in order to stimulate business, then no power on earth, no gimmick, device, trick or even indexation can prevent its economic consequences.
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If government manages to establish paper tickets or bank credit as money, as equivalent to gold grams or ounces, then the government, as dominant money-supplier, becomes free to create money costlessly and at will. As a result, this 'inflation' of the money supply destroys the value of the dollar or pound, drives up prices, cripples economic calculation, and hobbles and seriously damages the workings of the market economy.
Government policies try to prevent the emergence of serious unemployment by credit expansion, i.e., inflation. The outcome was rising prices, renewed demands for higher wages and reiterated credit expansion; in short, protracted inflation.
I have long been in favor of a balanced budget restriction at the level of the federal government of the United States. Because the federal government has money-creating powers it can, in fact, be very damaging if it runs a series of budget deficits. With the state government in the United States, they don't have money-creating powers. The automatic discipline imposed by the fact that they are in a common monetary unit and don't have control over the money power means that the balanced budget restriction is less needed.
If we discovered that, you know, space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months. ... There was a Twilight Zone episode like this in which scientists fake an alien threat in order to achieve world peace. Well, this time, we don't need it, we need it in order to get some fiscal stimulus.
Money is not a factor of production. But in order to have access to credit, in order to get money, in order to get an education, you have to pay the banks.
It's very simple. If the American people care about a lot of things including corruption in government, then, in fact, if you use the power to appoint in order to do political business, to clear fields, to save your party money and so on, if it's not a crime - and I believe it is - it certainly is business as usual, politics of corruption.
The social and racial conflict, which springs from the redistribution ideology, may deepen as economic output is shrinking and transfer 'entitlements cause budget deficits to soar. The U.S. dollar, which has become a mere corollary of government finance, is likely to survive the soaring deficits.
Under Reagan's policies, inflation and nominal GNP growth shriveled much faster than predicted, throwing off government revenue estimates and resulting in budget deficits.
If increased government spending with borrowed or newly created money is a 'stimulus,' then the Weimar Republic should have been stimulated to unprecedented prosperity, instead of runaway inflation and widespread economic desperation that ultimately brought Adolf Hitler to power.
Not even a superpower can hold onto its economic sovereignty if it fails to get its fiscal house in order, and no one needs a well-regulated international economic order more than the United States.
I think democracies are prone to inflation because politicians will naturally spend [excessively] - they have the power to print money and will use money to get votes. If you look at inflation under the Roman Empire, with absolute rulers, they had much greater inflation, so we don't set the record. It happens over the long-term under any form of government.
Religion forbids us from assuming a God-like character. This is especially true in politics and government, where limiting the power of the state, division of powers, and the doctrine of checks and balances are established in order to prevent accumulation of power that might lead to such Godly claims.
Governments create money and spend it into the economy by running budget deficits. The paper currency in your pocket is technically a government debt.
Cubans are a people who suffered from capitalism in the cruelest way, in the social order, the economic order and the political order.
Deficits do not in themselves produce inflation, nor does a balanced budget assure a stable price level.
People, you see... are ruthless and foolish. When they're young, in order to have money and power, they give up everything like health and youth. And when they get sick, become old, and have all the money and power... in order to find their health and youth again, they spend all of the wealth they've wasted so much energy and time to accumulate.
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