Cato — Timothy B Lee: Inflation not a moral issue ??

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At Forbes.com and here, Timothy B Lee asserts that inflation is not a moral issue; it is just a matter of economic expediency, the fine tuning that is necessary in a managed economy.

Timothy, please explain why the intentional transfer of wealth by government away from savers is not a moral issue. Do you mean that political power and political advantage are not moral issues?

You argue that the thrifty can and should invest in inflation-priced assets, and that the market prices the expected rate of inflation into its futures. If we accept that view, then, should we conclude that inflation is not a moral issue, but a change in the rate of inflation is a moral issue?

You argue by analogy that oil prices fluctuate and may or may not be good investments, and that the same is true of money. This begs the question — if an oil producer created reserves in the same way that governments create money, he would be prosecuted for criminal fraud, and rightly. Not a moral issue?

I suggest a more appropriate analogy: I have a responsibility to protect myself from pickpockets and muggers, but that responsibility does not mean that pickpockets and muggers are morally neutral.

Think about it.

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