Inflation God has joined together; no man can put asunder :-) (on Economistsview.typepad.com)

[ This was in REPLY to howls about how "unbearable" it will be when the combination of Social Security retirement payouts, Medicade and Medicare add up to 36% of GDP -- some 80 years out. ]

When, when, ever, ever, is this world going to catch up with the import of something called ECONOMIC GROWTH -- when viewing these kind of long, long term (80 years out) federal spending projections?!

Economic output per person doubles every 40 years -- which means quadruple every 80 years..

By 2082 (close enough to 80 years), someone whose grandparent earned $50,000/yr should be able to make $200,000/yr doing equivalent work (and that's not even counting "flying cars" for the same $25,000*).

Federal spending that takes 18% of a $50,000 income today leaves the earner with $41,000 for everything else -- federal spending that will take 36% of a $200,000 income tomorrow will leave the "suffering" tax payer with only $128,000 to spend on everything else (and that doesn't even count super potent medicine).

Three times the income left over, "3D" TV for the same price*, super healing: shouldn't we all glad we wont live to see those "terrible" days?

[ * Technological progress isn't counted by inflation (objections of the Gingriches of the world aside) because it would be:
a) inhuman: we are not going to give people living on indexed incomes less money to buy potatoes because they they can aquire a better TV for the same (adjusted) price;
b) unworkable: only God could put together into one inflation number that my new Timex watch costs half what the Timex of my youth (50 years ago) cost while it is 10 (?) times better -- and man would not find God's tech-included inflation number useful, anyway, unless it were broken back down into the two original interesting quantities;
c) unnecessary; when average income grows 20% over an average decade, there is no harm in leaving the free gifts of technology out of the inflation spec ("Mr. Sky is Falling", a.k.a. Chicken Little, Newt Gingrich who is panicking that old pensioners getting a few dollars of extra value out of their checks will cause civilization to crumble, aside).]

Posted by: Denis Drew | December 16, 2007 at 07:59 AM