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   Strypey (strypey@mastodon.nzoss.nz)'s status on Tuesday, 29-Nov-2022 05:48:24 JST Strypey

   This first 20 minutes or so if this episode of 1/200 podcast talks about the reasons why inflation and rising cost-of-living aren't as tightly coupled as the NatACTs would have us believe, and that inflation and government spending aren't connected in the way they'd have us think either:
   https://www.1of200.nz/podcast/1200-episode-185-dark-clouds-da-silva-linings

   #podcast #Aotearoa #NZ #NZPolitics

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     Strypey (strypey@mastodon.nzoss.nz)'s status on Tuesday, 29-Nov-2022 05:48:17 JST Strypey

     in reply to

     Is this the only way a government can keep the balloon of our economy from exploding? Of course not. They can spend more to help working class people afford the goods and services that are available, even during a time of high inflation. They just have to raise taxes - particularly on the 1% at the top of the wealth pyramid - enough to cover the difference. If they raise them a bit more than they increase spending, they can even help deflate the balloon a bit while they're at it.

     (4/4)

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     Strypey (strypey@mastodon.nzoss.nz)'s status on Tuesday, 29-Nov-2022 05:48:19 JST Strypey

     in reply to

     So there are two ways a government can avoid pumping too much air into an over-inflated balloon. Reduce the amount of air they're blowing in, by cutting spending, or increase the amount of air they're sucking out by increasing taxes. Thinking about it this way, we can see that despite the spin about "tax relief", what NatACTS' tax cuts do is fight inflation by taking public services away from the poorest kiwis, by cutting spending, and give most of it to the wealthiest in tax cuts.

     (3/?)

     るまたん repeated this.
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     Strypey (strypey@mastodon.nzoss.nz)'s status on Tuesday, 29-Nov-2022 05:48:20 JST Strypey

     in reply to

     When most of us spend money we're just moving air around inside the balloon. But when a government spends money that pumps more air into it. So government spending always causes ballooning inflation, right? No. Because governments can also take air out of the balloon at the same time, with taxation. So total government spending in a year can only causes inflation when it's higher than total taxation.

     (2/?)

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     Strypey (strypey@mastodon.nzoss.nz)'s status on Tuesday, 29-Nov-2022 05:48:23 JST Strypey

     in reply to

     One way to think about inflation is to imagine our economy as a balloon. The real economy - the good and services available to be bought - form the rubber skin of the balloon and the money supply is the air inside. Obviously, the more air there is in the balloon the tighter it gets, and in economics that tightness is called inflation. It's reflected in rising prices, including rising interest rates.

     (1/?)

     #economics #inflation