Letter: Spending will catch up to US

To the editor:

Do we need another lesson on inflation?

We all liked getting two checks this year. The government is passing out trillions of dollars because of COVID issues. The same thing is happening in most countries around the industrialized world.

So where is this money coming from? It is all borrowed money and must be repaid somehow.

Governments have two ways to repay this. First are taxes on the people. This in turn slows the general economy and may lead to a recession.

The second way is to float the currency and allow inflation to take place. With inflation they repay the debt with money worth just a fraction of what it was worth when borrowed.

We had inflation out of control in the 70s. We watched as our paychecks and income grew, but we couldn’t buy any more than we did before. That inflation paid for the “Great Society” and Vietnam War.

Fifty years ago, we lived comfortably on $1,400 to $1,600 a month. Today we need $1,500 a week just to get by.

Yesterday millions to billions of dollars were a lot of money. Now we talk in trillions.

What is next?

Many economists are saying we are entering another period of inflation. It will be painful for the unprepared.

The important thing is to look ahead. We must plan and budget our income as we watch the dollar as it slowly declines in value.

William Gerhard, Scipio