Watch the full episode on YouTube: https://www.youtube.com/watch?v=bcqZbqhKgyQ
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Here's a story I never learned about in school.
Before World War I kicked off, the British government polled their people. Simple question: do you want us to go to war over a current conflict going on in Eastern Europe?
67% of the population said yes.
Great. So the government raised $3 million in bonds. Brought it back to their people. And asked for their investment.
Only 33% of the people actually purchased bonds.
When it came time to vote with their dollars, the British people didn't actually want to go to war. Two-thirds talked. One-third walked. And that gap should have been the end of it. The money wasn't there. The citizens didn't fund it.
But the government had a trick. They went on credit. Printed the extra $2 million. Funded the rest of the bonds themselves. And used that fully funded $3 million to join what was known as World War 1.
That's the moment. That's when the precedent was set for a 100+ years of war.
Because here's the thing. With taxes, you feel the sting. It's one-to-one. Your paycheck shrinks, you know exactly why. And if stings badly enough you revolt. That's friction and it creates accountability on the people receiving your tax dollars to make good decisions. Otherwise, they’ll be voted out (or as mentioned, they’re will be a revolt).
With inflation, that phenomenon doesn’t occur. Your dollar just buys less. You blame the grocery store. You blame the gas station. The politician blames the last guy, or the guy after him.
There’s absolutely no accountability and it’s hard to trace the source.
More money is printed and you get what you think you “want”, but groceries, gas and things you actually need go up in price.
Who’s fault is that?
The business who now has to deal with rising costs because of all the newly minted money?
Or the person pressing the money clicker?
(It’s a bit more complicated then someone pressing a button and dollar bills coming out a machine. But for simplicity standpoint, this is what I’ll go with for now).
So who do you end up calling to stop these "evil" businesses?
The government.
And what do they do?
Print more money.
It’s bro. Please stop printing money.
Imagine hiring an arsonist to put out the fire they caused.
They’d pull out a flamethrower.
C’mon man!
By the way. I'm definitely not an expert on any of this. But it’s my goal to understand this stuff deeply.
I'm still learning every time I sit down and write about it.
But if I could wave a magic wand to change enough people’s minds in one way, it would be this.
Inflation doesn’t magically create new productivity out of the sky. It’s a wealth transfer. It takes money from some people and gives it to other people.
Nonetheless,
With every bit of research.
Every bit of awareness.
The collective intelligence grows.
That's when change happens. None bloody, none violent, real change.
Go get some.
The very best,
Matt McMahon