Economy

Often it seems like when liberals think of inflation, they downplay it – and don’t see it as the existential threat it is to their ideology. It’s more of a political football to them. But a good way to think about inflation is a government program flat funded at the same amount, under 7% inflation will be halved every seven years.

Inflation automatically trims government spending if appropriations don’t increase at the rate of inflation. Asking for big jumps in tax rates is unpopular in inflationary times, especially when people are already struggling to make ends meet with inflation.

For now, while the economy is good, revenues may keep up with inflation. Indeed these days it seems like many localities are reporting record sales tax collections. But at the same time, markets are slowing as the fed rates increase which really puts a damper on the stock market, which is chilling bonuses and other highly taxable sources of revenue. Inflation is corrosive. Like any form of corrosion, it might lurk in background, but eventually the rust becomes visible. Hardly all good news in the world of tax revenues.

The knife is coming for the back of liberalism, and it won’t be held by the Republicans or Conservatives. It will be held by inflation, which is the killer of government programs that become too expensive to fund are current levels of services.