< PREVIOUS ] [ 1989 Index ] [ Ed Quillen HOME ] [ SEARCH ] [ NEXT >
Wholesale prices were rising. Wall Street was getting jumpy. The Dow-Jones was dropping. Not at all concerned about my investments, since I have none, but still curious, I got through to my favorite inside source, Ananias Ziegler, public relations director for the Committee That Really Runs America.
Why's everybody so jittery about renewed
inflation?
I wondered. Out here in Colorado,
inflation has always been good for us.
Clever of you to notice that,
Ziegler replied.
When prices rise 15 percent a year, you've got a booming
real-estate market, your farmers prosper, your mines run at
full production. When there's no inflation, you're dead in
the water. You've been there for what, eight years
now?
I sadly agreed. Ever since the Reagan regime
began.
Ziegler laughed. A triumph of public relations. Here
we adopt economic policies that shaft the West, and guess
which part of the country supported Reagan most
enthusiastically? You Westerners are wonderful. All we have
to do is tell you what you like to hear -- a few catch
phrases like no gun control, Sagebrush Rebellion, rugged
individualism -- and you go away smiling. You never notice
that our economic policies benefit other regions of the
country, not you.
How's that?
I inquired. I know that halting
inflation worked against us, but whom did it
benefit?
The West is short on capital. It runs on borrowed
money from the East. Inflation benefits the borrower,
because he repays his loan in cheaper dollars. You can see
how that would hurt the lender. When inflation halts, it's
the other way around. The borrower suffers and the lender
benefits. Since the West borrows and the East lends -- do I
have to draw you a picture to demonstrate how the West got
taken by Reagan's policies while the East
benefited?
But I read a lot of political analysis about how
Reagan represented the new Sunbelt wing of the Republican
party, which had taken over from the old Wall Street party
powers. You mean he was on Wall Street's side all the
time?
It sure worked out that way.
Ziegler laughed.
Goes to show you how much you can trust political
analysis, doesn't it?
So I suppose these renewed fears of inflation will
give President Bush an excuse to make sure the West doesn't
prosper?
Of course,
Ziegler predicted. But we've
discovered an even better way to play Robin Hood in
reverse. No more regional games. We're going to milk one
economic class to help another. All we have to do is
continue with 'no new taxes.'
Just how does that take from the poor and give to the
rich?
If the federal government ran on a balanced budget,
then all your taxes would buy goods and services that
presumably benefit everyone, right? But since the budget
isn't balanced -- and won't be, as long as there are no new
taxes -- the federal government has to borrow every year
and pay interest.
Stands to reason,
I granted.
Did you know that interest comes right behind defense
and Social Security in the federal budget? It takes 13.6
percent of all federal spending.
I did some quick figuring. The average personal
return involves an income tax of $3,931. So $534.62 of that
goes to interest -- that means that 83 million working
Americans are each paying $10.28 a week for interest on the
federal debt.
How right you are.
Ziegler's laugh was almost
sardonic. That $10.28 a week from every working person
goes to the holders of the federal deficit. Just how many
working people do you know who buy $500,000 20-year
treasury notes or even $10,000 90-day T-bills?
I whistled with admiration. No new taxes means
continued borrowing which means more interest payments,
which are in effect an income transfer from the people who
do productive work to the people who clip coupons. You're
right. It is Robin Hood in reverse.
Ziegler laughed again before he hung up. But they'll
all think we're on the little guy's side when we keep
saying 'no new taxes.' As nearly as we can tell, most of
America is as gullible as the West.
< PREVIOUS ] [ 1989 Index ] [ Ed Quillen HOME ] [ SEARCH ] [ NEXT >