Can someone explain the gist of this article , the basic of what the writer is trying to tell me ,thank you (the rest of the article is http://www.quebecoislibre.org/001028-11.htm
[FONT=Arial,Helvetica][SIZE=+1]HOW GOVERNMENT MANIPULATES MONEY AND PRODUCES INFLATION[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Money is the lifeblood of commerce. In order to permit the market to operate, we need to ensure a stable, non-inflationary currency. Inflation invariably distorts the market. There are always different groups in the population being affected dissimilarly by inflation. Inflation leads to a misdirection of production and employment resulting in a misallocation of resources. Money which loses its value through inflation circumvents the mind by destroying the means of economic calculation and planning.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation is caused by printing more money. The government's monetary policies are responsible for this. Keynesian spending policies and ideology and the abolishment of the gold standard have permitted the government to depreciate our currency.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] The answer is to eradicate state control of the money supply. We need to divest government of its power to arbitrarily increase or decrease the money supply. In addition, we must build in pressures toward fiscal responsibility by the government with respect to the production of balanced budgets and reduction of debt. The federal government must learn to live within its means – government deficits must be prevented. The establishment of the gold standard will stifle the hidden and deceptive tax of inflation. Inflation could be controlled if government were not able to monetize debt or manipulate reserve requirements.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1]Defining inflation[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Money is a commodity the value of which stems from its usefulness as a medium of exchange. The best money is the one developed through the market system. Since barter has obvious limitations, one commodity (e.g., gold) arises as easier to trade and more useful as a medium of exchange. Exchange rates (i.e., prices) are established between this one commodity and each of the other goods. Historically and pragmatically, a commodity's ability to function as money has been transferred to money substitutes (e.g., the dollar). Honest money is fully backed by commodities like gold.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation, a monetary phenomenon, is an increase in money and credit. Its major consequence is rising prices. Inflation occurs when the economy's aggregate volume of money expenditures grows at a faster rate than its total real output grows. Inflation is thus an increase in the supply of money without a corresponding increase in the supply of goods and services.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation consists of expanding a nation's money supply by adding something other than real money (e.g., gold). Such fiat money, backed only by government decree, produces inflation. If the quantity of money is increased, the purchasing power of the monetary unit declines and the quantity of goods and services that can be purchased for one unit of this money also decreases. When government expands the quantity of paper money, the purchasing power of the monetary unit drops and prices rise. After the new money has been added to the economy, the total wealth produced is not any greater than it was previously. With added money now being spent, but with no additional goods and services to spend it on, prices will rise. In the U.S., it is only the federal government and government recognized banks that can print money and/or create new dollar credit.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1]Why does the government inflate?[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation is a dishonest and deliberate policy and tool of politicians who do not wish to reduce their spending. The government « creates » new money in order to cover what it spends in excess of its income. The existence of an unbalanced budget is a frequent reason for the government to print more money. When more is spent than is raised by taxes, the government makes up the difference with fiat money. The basic cause of inflation is the government's unwillingness to cut its spending plans or to raise the funds it desires by increasing taxation or by borrowing from the public.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Politicians want to spend but they do not want to raise taxes. Because higher taxes are unpopular, inflation commonly becomes the answer to deficit financing. When the government prints more money, people don't have to pay additional taxes, but ultimately they realize that dollars are not worth what they were previously. Monetary debasement is a scheme in which government force is used to take wealth from people and spend it. When the government makes new money and spends it, the effect on prices and the supply of goods and services is no different than when a private counterfeiter does so.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Exorbitant government expenditures are often the result of government efforts to redistribute income and wealth. Inflation can be connected to the appearance of the welfare state. Political leaders, confident in their own abilities, rationality, ability to control nature and society, and to produce continual progress, use government force to redistribute wealth in their compassionate efforts to achieve economic equality. Additional dollars, created through the printing press and credit expansion, enable the government to spend more and support more « deserving » non-producers than it could otherwise.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation transfers wealth from creditors to debtors of which the federal government is the largest. Debtors make payment with currency that is worth less than when the debt was assumed. Inflation repudiates government debt at the same time that it depreciates the purchasing power of the debt.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=+1]HOW GOVERNMENT MANIPULATES MONEY AND PRODUCES INFLATION[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1]by Edward W. Younkins[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Money is the lifeblood of commerce. In order to permit the market to operate, we need to ensure a stable, non-inflationary currency. Inflation invariably distorts the market. There are always different groups in the population being affected dissimilarly by inflation. Inflation leads to a misdirection of production and employment resulting in a misallocation of resources. Money which loses its value through inflation circumvents the mind by destroying the means of economic calculation and planning.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation is caused by printing more money. The government's monetary policies are responsible for this. Keynesian spending policies and ideology and the abolishment of the gold standard have permitted the government to depreciate our currency.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] The answer is to eradicate state control of the money supply. We need to divest government of its power to arbitrarily increase or decrease the money supply. In addition, we must build in pressures toward fiscal responsibility by the government with respect to the production of balanced budgets and reduction of debt. The federal government must learn to live within its means – government deficits must be prevented. The establishment of the gold standard will stifle the hidden and deceptive tax of inflation. Inflation could be controlled if government were not able to monetize debt or manipulate reserve requirements.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1]Defining inflation[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Money is a commodity the value of which stems from its usefulness as a medium of exchange. The best money is the one developed through the market system. Since barter has obvious limitations, one commodity (e.g., gold) arises as easier to trade and more useful as a medium of exchange. Exchange rates (i.e., prices) are established between this one commodity and each of the other goods. Historically and pragmatically, a commodity's ability to function as money has been transferred to money substitutes (e.g., the dollar). Honest money is fully backed by commodities like gold.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation, a monetary phenomenon, is an increase in money and credit. Its major consequence is rising prices. Inflation occurs when the economy's aggregate volume of money expenditures grows at a faster rate than its total real output grows. Inflation is thus an increase in the supply of money without a corresponding increase in the supply of goods and services.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation consists of expanding a nation's money supply by adding something other than real money (e.g., gold). Such fiat money, backed only by government decree, produces inflation. If the quantity of money is increased, the purchasing power of the monetary unit declines and the quantity of goods and services that can be purchased for one unit of this money also decreases. When government expands the quantity of paper money, the purchasing power of the monetary unit drops and prices rise. After the new money has been added to the economy, the total wealth produced is not any greater than it was previously. With added money now being spent, but with no additional goods and services to spend it on, prices will rise. In the U.S., it is only the federal government and government recognized banks that can print money and/or create new dollar credit.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1]Why does the government inflate?[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation is a dishonest and deliberate policy and tool of politicians who do not wish to reduce their spending. The government « creates » new money in order to cover what it spends in excess of its income. The existence of an unbalanced budget is a frequent reason for the government to print more money. When more is spent than is raised by taxes, the government makes up the difference with fiat money. The basic cause of inflation is the government's unwillingness to cut its spending plans or to raise the funds it desires by increasing taxation or by borrowing from the public.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Politicians want to spend but they do not want to raise taxes. Because higher taxes are unpopular, inflation commonly becomes the answer to deficit financing. When the government prints more money, people don't have to pay additional taxes, but ultimately they realize that dollars are not worth what they were previously. Monetary debasement is a scheme in which government force is used to take wealth from people and spend it. When the government makes new money and spends it, the effect on prices and the supply of goods and services is no different than when a private counterfeiter does so.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Exorbitant government expenditures are often the result of government efforts to redistribute income and wealth. Inflation can be connected to the appearance of the welfare state. Political leaders, confident in their own abilities, rationality, ability to control nature and society, and to produce continual progress, use government force to redistribute wealth in their compassionate efforts to achieve economic equality. Additional dollars, created through the printing press and credit expansion, enable the government to spend more and support more « deserving » non-producers than it could otherwise.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] Inflation transfers wealth from creditors to debtors of which the federal government is the largest. Debtors make payment with currency that is worth less than when the debt was assumed. Inflation repudiates government debt at the same time that it depreciates the purchasing power of the debt.[/SIZE][/FONT]
[FONT=Arial,Helvetica][SIZE=-1] [/SIZE][/FONT]