Inflation—An Unlegislated Tax

Inflation might be thought of as an unleg­islated tax on consumers that reduces their purchasing power. One example would be when the electorate demands goods or services from government, like medical care, subsidies, infrastructure, pensions, etc., without adequately paying for these goods or services with taxes. Inflation then results as spending is pursued via monetary expansion (figuratively, money printing)—as opposed to increases in productivity.