Nobel Prize-winning economist Milton Friedman explained, \u201cInflation is always and everywhere a monetary phenomenon, in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.\u201d<\/p>\n
On the campaign trail, President Biden said, \u201cMilton Friedman isn\u2019t running the show anymore.\u201d Talk about tempting fate. Friedman is having the last laugh now. Even presidents can\u2019t fight basic economics.<\/p>\n
Today\u2019s historic inflation is the chit that\u2019s been looming due for years of fiscal profligacy and easy money that politicians have said is \u201ccost-free.\u201d It\u2019s a black eye for Democrats, because it directly results from their Keynesian fiscal religion and Modern Monetary Theory (MMT) madness.<\/p>\n
Today\u2019s painful inflation should put a nail in the coffin of MMT, the belief held (at least in practice) by many Democrats that deficits don\u2019t matter, because money grows on trees\u2014or at least on Federal Reserve printers. Indeed, the inflation cost of MMT is proving high and painful. This philosophy is also responsible for the federal debt hitting $32 trillion, the net interest on which threatens to be a massive drag on the economy moving forward.<\/p>\n
The decreasing value of the dollar further discredits the big-government approach to managing the economy. Next time the government calls for some massive social spending program, small businesses will be wary. \u201cWe tried that approach already,\u201d Americans can say, \u201cand it resulted in runaway inflation, falling real incomes, and decreased living standards.\u201d<\/p>\n