America’s Return to Runaway Inflation

America’s Return to Runaway Inflation

by | Aug 27, 2021 | Blog

“Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some.”

This quote comes from John Maynard Keynes, the father of Keynesian economics which has controlled American fiscal policy since the New Deal days of the 1930s.

Keynes himself was a believer in the same process of currency debasement that he attributes to the founding father of Soviet communism. Through deficit spending and so-called government “fine-tuning” of the economy, Keynesianism laid the groundwork for America’s current financial nightmare, a $30 trillion national debt, annual deficits bigger than the entire federal budget a few years ago and the insanity of Modern Monetary Theory which has been embraced by the Biden regime and Democrats in Congress. MMT essentially is a recipe for perpetual currency debauchery through the unlimited printing of Federal Reserve Notes.

Of course, inflation is always the middle-class destroying result of such policies. Contrary to the lies perpetrated by the lamestream media, inflation is not rising prices or wages or caused by greedy businessmen or union members. Rising prices and wages are the result of inflation which is simply a decline in the value of the currency caused by “too much money chasing too few goods.” When more currency is put into circulation, the value of all the other currency in circulation declines unless it is offset by a corresponding increase in the amount of goods and services produced. Think of an auction. If each individual who has $100 to bid is suddenly given an additional $500, what will happen to the auction bids? They will naturally go up.

Of course, under the Biden-Harris regime, America is now poised to experience its worst inflation since the Jimmy Carter days of the late 1970s. Just months into this new regime, we are already seeing inflation numbers that are the highest in at least 15 years. And, it’s about to get much, much worse.

With Biden planning to spend over $6 trillion annually in his next federal budget, trillions of COVID stimulus injected into the economy over the last year, and tens of trillions more planned in the coming years for every left-wing scheme in AOC’s

socialist arsenal, America is headed toward a fiscal Armageddon. We are currently seeing massive increases in commodity prices such as corn and wheat, mind-bending increases in the price of lumber and gasoline prices are up by 50% just since the regime was installed into power with fraudulent electoral votes on January 20.

Of course, Biden is not just engaging in a spending spree and orgy of money-printing which would be bad enough in itself. He’s also doing everything in his power to cripple our economy through taxes and regulations and shutdowns that will decrease the supply of goods and services, making the inflation that much more severe. Look at the Keystone Excel pipeline, for example. He has promised to end fracking and close down our energy industry because it “pollutes.” Will you be able to afford the gas and electricity bills that will arrive due to such policies? The economy has already been devastated as a result of 15 months of needless lockdowns due to COVID which have permanently wiped out tens of thousands of businesses across America and millions of jobs. That many fewer goods and services produced to absorb the coming hailstorm of printing-press money.    

In addition, the Democrat agenda seeks a “universal basic income” for which the so-called COVID “stimulus” payments are a precursor. UBI will simply pay people not to work. Once again, that’s a recipe for reducing the amount of goods and services produced which will cause inflation to rage even more fiercely. We are already seeing labor shortages throughout the nation due to the COVID checks and “enhanced” unemployment benefits. Millions don’t want to return to the work force and jobs are going begging. So, how do businesses pull these workers back in? Offer much higher wages which will be passed on to consumers in the form of higher prices. Once again, inflation.

To some, inflation is just a minor annoyance when it’s running at 2% a year or whatever Jay Powell’s target rate is at any given moment. Even 4% seems benign compared to 18% under Jimmy Carter in 1980. Yet, do you know that according to the rule of 72, even a 4% inflation rate means prices double every eighteen years? Is that acceptable?

We should look back at history to see how inflation destroys a nation. It wipes out savings, cobbles investment, and inevitably decimates the middle class. Think back to Weimar Germany in the 1920s and early 1930s and the rampaging inflation that led to the rise of Adolf Hitler. How about post-war China where communist Harry Dexter White in our Treasury Department refused to ship our friend Chiang Kai-Shek the gold to stabilize his currency. This led to hyperinflation which paved the way for Mao’s bloody takeover in 1949. How about Chile in 1973 where 300% inflation under socialist hero Salvador Allende led to the revolt of the housewives and the military coup that deposed Allende. How about present-day Venezuela where people are eating out of garbage cans.

Is this America’s future?  Sadly, it is probably unavoidable at this point as the only method by which government can now repudiate its gargantuan debt is by inflating its way out of it. And, make no mistake about it, inflation is a tax. It is a stealth tax. It is not deducted from your paycheck through withholding nor does it appear on a 1040. Yet, it is a tax nevertheless, one that is aimed straight at the heart of the working and middle classes. However, as Keynes observed and Congressman Ron Paul has always maintained, inflation also benefits the richest folks on the planet. For the newly-printed dollars always flow to the financial and banking elites first, long before they are devalued and trickle down to the rest of us. Only by returning to a gold-backed currency and fiscal discipline in Washington, D.C. can we have any hope of dodging the oncoming freight train of runaway inflation. 

 

Dr. James Veltmeyer is a prominent La Jolla physician and author of “Physician on a Mission: Dr. Veltmeyer’s RX to Save America.”He was voted “Top Doctor” in San Diego County in 2012, 2014, 2016, 2017, and 2019.  Dr. Veltmeyer can be reached at dr.jamesveltmeyer@protonmail.com  and by visiting his website at drveltmeyer.com

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