Inflation Is Good for You
Don’t panic over milk prices. Inflation is bad for the 1 percent but helps out almost everyone else.
Jon Schwarz
November 10 2021, 3:25 p.m.
DONATE
NEW YORK, NEW YORK - NOVEMBER 05: People shop at an outdoor food market in Manhattan on November 05, 2021 in New York City. Inflation is causing U.S. consumer prices to increase solidly in the past few months on items such as food, rent, cars and other goods, A new report by the United Nations Food and Agriculture Organization (FAO) shows that global food prices have hit the highest level in over a decade. In the last year alone, food prices have risen by more than 30%. (Photo by Spencer Platt/Getty Images)As inflation is causing U.S. consumer prices to increase, people shop at an outdoor food market in Manhattan, N.Y., on Nov. 5, 2021. Photo: Spencer Platt/Getty Images

THE TOP STORY on the New York Times website this morning is about inflation, and it’s scary: “Inflation spiked in October, sinking Washington’s hopes that price gains would slow down.”
The Washington Post led with a similar call for alarm: “Prices climbed 6.2 percent in October compared to last year, the largest increase in 30 years, as inflation strains economy.”

Television, which follows the lead of the Times and the Post as surely as death follows life, will now produce many more peculiar segments like CNN’s botched portrayal of the impact of inflation on a large Texas family that buys huge quantities of milk.


Whenever the corporate media moves en masse like this, it’s a good idea to slow down and consider what’s actually happening, and why.

A panic about inflation usefully creates the conditions to weaken the power of working people.
And what’s happening is this: The inflation freakout is all about class conflict. In fact, it may be the fundamental class conflict: that between creditors and debtors, a fight that’s been going on since the foundation of the United States.

That’s because inflation is often good for most of us, but it’s terrible for the kinds of people who own corporate news outlets — or, say, founded coal firms. And a panic about inflation usefully creates the conditions to weaken the power of working people.


Today’s stories were generated by the release of inflation numbers for October by the U.S. Bureau of Labor Statistics. BLS found that prices for all goods rose 0.9 percent in the last month. In other words, on average, products that cost $10.00 in September now cost a terrifying $10.09.

Also, overall prices are now 6.2 percent higher than they were a year ago. So something that cost $10.00 in October 2020 is now $10.62.

You’ll notice here that both the Times and Post were misleading about this. The Post headline — “Prices climbed 6.2 percent in October compared to last year” — makes it sound like prices went up 6.2 percent in October, i.e., in one month. The Times similarly has a graph with a label saying prices went up “6.2 percent in October.” That truly would be a problem. Fortunately, that didn’t happen.

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So why has inflation seized the imagination of the corporate press? It’s simple.

First, inflation lessens the real value of debt. In 2020, American households had around $14.5 trillion in debt from their mortgages, credit cards, student loans, and other sources. Inflation of 6.2 percent means that the real value of that $14.5 trillion is now just $13.65 trillion in last year’s dollars.

In other words, the inflation over the past year has effectively t***sferred $850 billion in wealth from creditors to debtors. That’s a lot of money.

Most people are a mixture of creditors (e.g., you have a bank account) and debtors (you have a mortgage and student loans). But overall, this $850 billion has generated a big check written by the tippy-top of the income scale to everyone else. And as you’d expect, the people at the tippy-top don’t like this.

Second, inflation generally accompanies economic booms, when the unemployment rate is low and workers have the market power to demand higher pay. That’s what’s happening now: As prices increased 6.2 percent over the past year, wages for regular people went up 5.8 percent. In other words, inflation barely touched their purchasing power. And with almost 300 labor strikes in the U.S. so far this year, workers are leveraging their power to demand better compensation at historic rates. So while inflation can be a significant problem for workers if they don’t get it back in higher paychecks, that seems unlikely today.

Moreover, the median American recently had about $65,000 in debt. And while inflation has reduced the real value of each dollar of wages — in other words, its worth relative to tangible things — it’s done the same to the real value of each dollar of debt. Workers who get raises will have more dollars to pay off the same dollar amount of debt.

Put these two things together — lowered values for their assets and higher wages for workers — and you can understand why the rich people who run the U.S. absolutely detest inflation.

However, there is one rock that can k**l both these birds at the same time. The Federal Reserve can raise interest rates. This would slow the economy and increase the unemployment rate, lessening worker bargaining power. Less bargaining power would mean lower or nonexistent raises, which would eventually t***slate into lower inflation.

That’s what all today’s inflation panic is ultimately aimed at: creating an economy with higher unemployment, lower growth, and more frightened workers. Whether America’s creditors can make this happen remains to be seen, but we shouldn’t have any illusions about what they’re trying to do. And we definitely shouldn’t help them do it.

Correction: November 11, 2021

This article has been updated to clarify how inflation can reduce the value of debt held by American households. The article previously stated that the median debt would go down by $4,000. However, the reduction in debt on average for individuals isn’t calculable with current data.

Inflation Is Good for You
Don’t panic over milk prices. Inflation is bad for the 1 percent but helps out almost everyone else.
Jon Schwarz
November 10 2021, 3:25 p.m.
DONATE
NEW YORK, NEW YORK - NOVEMBER 05: People shop at an outdoor food market in Manhattan on November 05, 2021 in New York City. Inflation is causing U.S. consumer prices to increase solidly in the past few months on items such as food, rent, cars and other goods, A new report by the United Nations Food and Agriculture Organization (FAO) shows that global food prices have hit the highest level in over a decade. In the last year alone, food prices have risen by more than 30%. (Photo by Spencer Platt/Getty Images)As inflation is causing U.S. consumer prices to increase, people shop at an outdoor food market in Manhattan, N.Y., on Nov. 5, 2021. Photo: Spencer Platt/Getty Images

THE TOP STORY on the New York Times website this morning is about inflation, and it’s scary: “Inflation spiked in October, sinking Washington’s hopes that price gains would slow down.”
The Washington Post led with a similar call for alarm: “Prices climbed 6.2 percent in October compared to last year, the largest increase in 30 years, as inflation strains economy.”

Television, which follows the lead of the Times and the Post as surely as death follows life, will now produce many more peculiar segments like CNN’s botched portrayal of the impact of inflation on a large Texas family that buys huge quantities of milk.


Whenever the corporate media moves en masse like this, it’s a good idea to slow down and consider what’s actually happening, and why.

A panic about inflation usefully creates the conditions to weaken the power of working people.
And what’s happening is this: The inflation freakout is all about class conflict. In fact, it may be the fundamental class conflict: that between creditors and debtors, a fight that’s been going on since the foundation of the United States.

That’s because inflation is often good for most of us, but it’s terrible for the kinds of people who own corporate news outlets — or, say, founded coal firms. And a panic about inflation usefully creates the conditions to weaken the power of working people.


Today’s stories were generated by the release of inflation numbers for October by the U.S. Bureau of Labor Statistics. BLS found that prices for all goods rose 0.9 percent in the last month. In other words, on average, products that cost $10.00 in September now cost a terrifying $10.09.

Also, overall prices are now 6.2 percent higher than they were a year ago. So something that cost $10.00 in October 2020 is now $10.62.

You’ll notice here that both the Times and Post were misleading about this. The Post headline — “Prices climbed 6.2 percent in October compared to last year” — makes it sound like prices went up 6.2 percent in October, i.e., in one month. The Times similarly has a graph with a label saying prices went up “6.2 percent in October.” That truly would be a problem. Fortunately, that didn’t happen.

First, inflation lessens the real value of debt. In 2020, American households had around $14.5 trillion in debt from their mortgages, credit cards, student loans, and other sources. Inflation of 6.2 percent means that the real value of that $14.5 trillion is now just $13.65 trillion in last year’s dollars.

In other words, the inflation over the past year has effectively t***sferred $850 billion in wealth from creditors to debtors. That’s a lot of money.

Most people are a mixture of creditors (e.g., you have a bank account) and debtors (you have a mortgage and student loans). But overall, this $850 billion has generated a big check written by the tippy-top of the income scale to everyone else. And as you’d expect, the people at the tippy-top don’t like this.

Second, inflation generally accompanies economic booms, when the unemployment rate is low and workers have the market power to demand higher pay. That’s what’s happening now: As prices increased 6.2 percent over the past year, wages for regular people went up 5.8 percent. In other words, inflation barely touched their purchasing power. And with almost 300 labor strikes in the U.S. so far this year, workers are leveraging their power to demand better compensation at historic rates. So while inflation can be a significant problem for workers if they don’t get it back in higher paychecks, that seems unlikely today.

Moreover, the median American recently had about $65,000 in debt. And while inflation has reduced the real value of each dollar of wages — in other words, its worth relative to tangible things — it’s done the same to the real value of each dollar of debt. Workers who get raises will have more dollars to pay off the same dollar amount of debt.

Put these two things together — lowered values for their assets and higher wages for workers — and you can understand why the rich people who run the U.S. absolutely detest inflation.

However, there is one rock that can k**l both these birds at the same time. The Federal Reserve can raise interest rates. This would slow the economy and increase the unemployment rate, lessening worker bargaining power. Less bargaining power would mean lower or nonexistent raises, which would eventually t***slate into lower inflation.

That’s what all today’s inflation panic is ultimately aimed at: creating an economy with higher unemployment, lower growth, and more frightened workers. Whether America’s creditors can make this happen remains to be seen, but we shouldn’t have any illusions about what they’re trying to do. And we definitely shouldn’t help them do it.

Correction: November 11, 2021

This article has been updated to clarify how inflation can reduce the value of debt held by American households. The article previously stated that the median debt would go down by $4,000. However, the reduction in debt on average for individuals isn’t calculable with current data.

Inflation Is Good for You
Don’t panic over milk prices. Inflation is bad for the 1 percent but helps out almost everyone else.
Jon Schwarz
November 10 2021, 3:25 p.m.
DONATE
NEW YORK, NEW YORK - NOVEMBER 05: People shop at an outdoor food market in Manhattan on November 05, 2021 in New York City. Inflation is causing U.S. consumer prices to increase solidly in the past few months on items such as food, rent, cars and other goods, A new report by the United Nations Food and Agriculture Organization (FAO) shows that global food prices have hit the highest level in over a decade. In the last year alone, food prices have risen by more than 30%. (Photo by Spencer Platt/Getty Images)As inflation is causing U.S. consumer prices to increase, people shop at an outdoor food market in Manhattan, N.Y., on Nov. 5, 2021. Photo: Spencer Platt/Getty Images

THE TOP STORY on the New York Times website this morning is about inflation, and it’s scary: “Inflation spiked in October, sinking Washington’s hopes that price gains would slow down.”
The Washington Post led with a similar call for alarm: “Prices climbed 6.2 percent in October compared to last year, the largest increase in 30 years, as inflation strains economy.”

Television, which follows the lead of the Times and the Post as surely as death follows life, will now produce many more peculiar segments like CNN’s botched portrayal of the impact of inflation on a large Texas family that buys huge quantities of milk.


Whenever the corporate media moves en masse like this, it’s a good idea to slow down and consider what’s actually happening, and why.

A panic about inflation usefully creates the conditions to weaken the power of working people.
And what’s happening is this: The inflation freakout is all about class conflict. In fact, it may be the fundamental class conflict: that between creditors and debtors, a fight that’s been going on since the foundation of the United States.

That’s because inflation is often good for most of us, but it’s terrible for the kinds of people who own corporate news outlets — or, say, founded coal firms. And a panic about inflation usefully creates the conditions to weaken the power of working people.


Today’s stories were generated by the release of inflation numbers for October by the U.S. Bureau of Labor Statistics. BLS found that prices for all goods rose 0.9 percent in the last month. In other words, on average, products that cost $10.00 in September now cost a terrifying $10.09.

Also, overall prices are now 6.2 percent higher than they were a year ago. So something that cost $10.00 in October 2020 is now $10.62.

You’ll notice here that both the Times and Post were misleading about this. The Post headline — “Prices climbed 6.2 percent in October compared to last year” — makes it sound like prices went up 6.2 percent in October, i.e., in one month. The Times similarly has a graph with a label saying prices went up “6.2 percent in October.” That truly would be a problem. Fortunately, that didn’t happen.

First, inflation lessens the real value of debt. In 2020, American households had around $14.5 trillion in debt from their mortgages, credit cards, student loans, and other sources. Inflation of 6.2 percent means that the real value of that $14.5 trillion is now just $13.65 trillion in last year’s dollars.

In other words, the inflation over the past year has effectively t***sferred $850 billion in wealth from creditors to debtors. That’s a lot of money.

Most people are a mixture of creditors (e.g., you have a bank account) and debtors (you have a mortgage and student loans). But overall, this $850 billion has generated a big check written by the tippy-top of the income scale to everyone else. And as you’d expect, the people at the tippy-top don’t like this.

Second, inflation generally accompanies economic booms, when the unemployment rate is low and workers have the market power to demand higher pay. That’s what’s happening now: As prices increased 6.2 percent over the past year, wages for regular people went up 5.8 percent. In other words, inflation barely touched their purchasing power. And with almost 300 labor strikes in the U.S. so far this year, workers are leveraging their power to demand better compensation at historic rates. So while inflation can be a significant problem for workers if they don’t get it back in higher paychecks, that seems unlikely today.

Moreover, the median American recently had about $65,000 in debt. And while inflation has reduced the real value of each dollar of wages — in other words, its worth relative to tangible things — it’s done the same to the real value of each dollar of debt. Workers who get raises will have more dollars to pay off the same dollar amount of debt.

Put these two things together — lowered values for their assets and higher wages for workers — and you can understand why the rich people who run the U.S. absolutely detest inflation.

However, there is one rock that can k**l both these birds at the same time. The Federal Reserve can raise interest rates. This would slow the economy and increase the unemployment rate, lessening worker bargaining power. Less bargaining power would mean lower or nonexistent raises, which would eventually t***slate into lower inflation.

That’s what all today’s inflation panic is ultimately aimed at: creating an economy with higher unemployment, lower growth, and more frightened workers. Whether America’s creditors can make this happen remains to be seen, but we shouldn’t have any illusions about what they’re trying to do. And we definitely shouldn’t help them do it.

Correction: November 11, 2021

This article has been updated to clarify how inflation can reduce the value of debt held by American households. The article previously stated that the median debt would go down by $4,000. However, the reduction in debt on average for individuals isn’t calculable with current data.

Every time I think that you cannot top your self, you do. I don't know how old you are, but you must not have lived through as an adult, the high inflation Jimmy Carter years of the late 1970s. Debasing a currency is never a good idea. Never. As far as who inflation is good for, the author of this farce is an i***t.

In inflationary times inflation benefits whom ever can raise prices, wages, or their income, and it hurts those who cannot. I guess you do not give a rat's ass about the elderly, who are on fixed incomes, and cannot keep up with inflation.

You represent the brain dead Biden v**ers very well.

Inflation Is Good for You
Don’t panic over milk prices. Inflation is bad for the 1 percent but helps out almost everyone else.
Jon Schwarz
November 10 2021, 3:25 p.m.
DONATE
NEW YORK, NEW YORK - NOVEMBER 05: People shop at an outdoor food market in Manhattan on November 05, 2021 in New York City. Inflation is causing U.S. consumer prices to increase solidly in the past few months on items such as food, rent, cars and other goods, A new report by the United Nations Food and Agriculture Organization (FAO) shows that global food prices have hit the highest level in over a decade. In the last year alone, food prices have risen by more than 30%. (Photo by Spencer Platt/Getty Images)As inflation is causing U.S. consumer prices to increase, people shop at an outdoor food market in Manhattan, N.Y., on Nov. 5, 2021. Photo: Spencer Platt/Getty Images

THE TOP STORY on the New York Times website this morning is about inflation, and it’s scary: “Inflation spiked in October, sinking Washington’s hopes that price gains would slow down.”
The Washington Post led with a similar call for alarm: “Prices climbed 6.2 percent in October compared to last year, the largest increase in 30 years, as inflation strains economy.”

Television, which follows the lead of the Times and the Post as surely as death follows life, will now produce many more peculiar segments like CNN’s botched portrayal of the impact of inflation on a large Texas family that buys huge quantities of milk.


Whenever the corporate media moves en masse like this, it’s a good idea to slow down and consider what’s actually happening, and why.

A panic about inflation usefully creates the conditions to weaken the power of working people.
And what’s happening is this: The inflation freakout is all about class conflict. In fact, it may be the fundamental class conflict: that between creditors and debtors, a fight that’s been going on since the foundation of the United States.

That’s because inflation is often good for most of us, but it’s terrible for the kinds of people who own corporate news outlets — or, say, founded coal firms. And a panic about inflation usefully creates the conditions to weaken the power of working people.


Today’s stories were generated by the release of inflation numbers for October by the U.S. Bureau of Labor Statistics. BLS found that prices for all goods rose 0.9 percent in the last month. In other words, on average, products that cost $10.00 in September now cost a terrifying $10.09.

Also, overall prices are now 6.2 percent higher than they were a year ago. So something that cost $10.00 in October 2020 is now $10.62.

You’ll notice here that both the Times and Post were misleading about this. The Post headline — “Prices climbed 6.2 percent in October compared to last year” — makes it sound like prices went up 6.2 percent in October, i.e., in one month. The Times similarly has a graph with a label saying prices went up “6.2 percent in October.” That truly would be a problem. Fortunately, that didn’t happen.

First, inflation lessens the real value of debt. In 2020, American households had around $14.5 trillion in debt from their mortgages, credit cards, student loans, and other sources. Inflation of 6.2 percent means that the real value of that $14.5 trillion is now just $13.65 trillion in last year’s dollars.

In other words, the inflation over the past year has effectively t***sferred $850 billion in wealth from creditors to debtors. That’s a lot of money.

Most people are a mixture of creditors (e.g., you have a bank account) and debtors (you have a mortgage and student loans). But overall, this $850 billion has generated a big check written by the tippy-top of the income scale to everyone else. And as you’d expect, the people at the tippy-top don’t like this.

Second, inflation generally accompanies economic booms, when the unemployment rate is low and workers have the market power to demand higher pay. That’s what’s happening now: As prices increased 6.2 percent over the past year, wages for regular people went up 5.8 percent. In other words, inflation barely touched their purchasing power. And with almost 300 labor strikes in the U.S. so far this year, workers are leveraging their power to demand better compensation at historic rates. So while inflation can be a significant problem for workers if they don’t get it back in higher paychecks, that seems unlikely today.

Moreover, the median American recently had about $65,000 in debt. And while inflation has reduced the real value of each dollar of wages — in other words, its worth relative to tangible things — it’s done the same to the real value of each dollar of debt. Workers who get raises will have more dollars to pay off the same dollar amount of debt.

Put these two things together — lowered values for their assets and higher wages for workers — and you can understand why the rich people who run the U.S. absolutely detest inflation.

However, there is one rock that can k**l both these birds at the same time. The Federal Reserve can raise interest rates. This would slow the economy and increase the unemployment rate, lessening worker bargaining power. Less bargaining power would mean lower or nonexistent raises, which would eventually t***slate into lower inflation.

That’s what all today’s inflation panic is ultimately aimed at: creating an economy with higher unemployment, lower growth, and more frightened workers. Whether America’s creditors can make this happen remains to be seen, but we shouldn’t have any illusions about what they’re trying to do. And we definitely shouldn’t help them do it.

Correction: November 11, 2021

This article has been updated to clarify how inflation can reduce the value of debt held by American households. The article previously stated that the median debt would go down by $4,000. However, the reduction in debt on average for individuals isn’t calculable with current data.