But doesn't this version of inflation emerge like this: Some sector (economic or social) raises their price (or wage) shifting income in their favor; the others resist by raising their price (wage) in turn; and on and on. Ongoing inflation (rather than a one-shot) is a distributional struggle. At some point in this game of "hot potato" it is the turn of wage earners and eventually they are left with the burnt hands (often creditors as well). But this game of "hot potato" can take several rounds (if the wage earners are strong in defending their standard of living). How many rounds the wage earners last is usually the principal factor determining the duration and degree of inflation.
Is there really much countervailing power in the socio-economic formation of the US today? From which part of the economy or society?
Paul
Gene Coyle, citing Daniel Davies writes:
As I read almost daily of giant corporations and Wall Street analysts deploring "the lack of pricing power" I believe that inflation would be (will be?) welcomed by big capital.
Are we absolutely sure that the whole problem will not end up being solved by an inflation rather than a recession? I know that this is the orthodox view; that US rentier capital is big enough, important enough and anti-inflation enough that anything will be tolerated other than inflation, but it does strike me that it would sort a lot of things out, rather less painfully than they might otherwise be sorted out.
