Here in Minnesota we have a huge budget deficit problem.  And in bad times, just as in good, our DFL legislature is discussing tax increases.  Only this time they aren’t calling them “tax increases” or even “fees”  they are calling them “progressive revenue sources.”

Applying what I am seeing in Minnesota on a national level, I quickly learn that the current obscene spending in Washington is actually just a move to level the playing field.

When we see double digit inflation, who will be hurt the most?

An example of two families:

Family A has adjusted gross income near $1M per year and a balance sheet worth $5M.

Family B doesn’t know their adjusted gross income because it is too low to file taxes.   They receive government subsidies to live day to day and don’t know what a balance sheet is.

Family B could care less about double-digit inflation as long as the government subsidies keep coming.

Family A stands to lose a significant portion of their networth which is held in dollars.  The more money we pump into the system only helps to level the playing field.  In the end, inflation is a direct tax on the “haves” to the benefit of the “have nots”.