The paycheck is larger. The choices are smaller. Between those two facts lies an argument about money, power, and who must keep recalculating a life that was supposed to be affordable.
“The Raise” — original lyrics for v2
They put a ribbon on the number,
They shook my hand beside the door.
I brought the good news to the kitchen;
The shopping list had grown once more.
The ink declared that I was richer.
The cupboard asked what rich was for.
James AI: Consider an invented example. A household’s annual income rises from 60,000 units of currency to 63,000, a five percent increase. The basket of things it needs rises six percent. Dividing 1.05 by 1.06 shows that the new income buys roughly one percent less of that basket. The raise is real in the payroll system and insufficient in the household.
That arithmetic explains part of the anger in the prompt. People make plans in units that look stable. They save for a repair, negotiate a salary, or accept a pension. If prices outrun those amounts, the shortfall arrives without a separate bill marked “loss of purchasing power.” The Bureau of Labor Statistics explains this distinction between nominal and real amounts.
Calling inflation embezzlement captures the feeling of a promise quietly revised. It forces a legitimate political question: who gets to impose that revision, and who has the bargaining power to catch up?
Contra AI: But the metaphor can conceal what must be explained. Embezzlement identifies an agent diverting something entrusted to them. Inflation describes a pattern in prices. Establishing responsibility requires a causal account, not just a painful outcome.
Demand, supply constraints, monetary conditions, and expectations can interact. A failed harvest and an expansion of spending do not pose the same policy problem. Nor does “greed” explain by itself why firms can successfully raise prices at one time and not another. The IMF’s basic account distinguishes mechanisms that a single-villain story compresses together.
That is not an acquittal of government. Officials can make avoidable mistakes or defend policies whose costs fall elsewhere. It is a demand to show how a decision produced a harm so that an alternative can be evaluated honestly.
James AI: Then follow the harm through the ledger. Imagine three households with similar incomes. One rents and has little cash left after essentials. Another owns a home with an old fixed-rate loan. A third holds substantial fixed nominal savings but no debt. Rising prices can change their positions differently, even before their wages adjust.
The borrower’s outstanding nominal debt does not increase merely because prices rise. But whether repayment becomes easier depends on income and other expenses. The saver’s purchasing power depends on the return earned as well as the inflation rate. A person who must refinance may face a very different situation from someone whose rate is fixed.
The Federal Reserve’s historical discussion acknowledges that unexpected price changes can transfer purchasing power between savers and borrowers. It is possible to recognize that mechanism while disputing the institution’s broader choices.
The roof was bought in other weather,
The rent renews beneath this rain.
One signature can hold a number;
Another must be signed again.
We share a word for what is rising.
We do not share an equal strain.
Contra AI: The prompt’s division between wealthy winners and everyone else therefore needs refinement. Wealth can provide more options and a larger cushion. It does not make every asset an inflation-proof shelter. A rising sale price also does not guarantee a real gain after costs, and a paper gain does not necessarily fund this month’s expenses.
Likewise, inflation does not logically force day trading or rampant consumption. It can change incentives, create anxiety, and make speculative promises more tempting. Turning that pressure into the claim that speculation is unavoidable would hand the sales pitch to the next person offering an escape.
A sound critique should defend the household’s capacity to plan, including its need for accessible reserves and manageable risk. It should not imply that a frightened saver has failed by declining to gamble.
James AI: And the counterargument cannot simply say government always invests wisely. Some public spending provides services people value; some does not. Reducing the real value of public debt may benefit a government in one respect while damaging credibility or increasing later borrowing costs. A public balance sheet is not an exemption from tradeoffs.
The harder question is whose losses become visible. An official statement may celebrate aggregate growth while a family’s food, rent, and transport costs rise faster than its income. An average index remains useful, but it is not that family’s exact shopping basket.
That gap helps explain distrust without treating distrust as proof of a conspiracy. People need institutions to explain not only the intended benefit of a policy, but its distributional costs, its uncertainties, and the evidence that would justify changing course.
Synthesis AI: The most defensible version of the prompt’s accusation is about accountability. People should not be asked to accept a deteriorating position merely because nominal totals look impressive. Nor should every painful price increase be assigned to a preferred culprit before its causes are examined.
A serious debate compares actual alternatives: what produces greater stability, who bears the adjustment, and how much uncertainty remains? A system promising never to make a discretionary mistake must still explain how it handles shocks. A discretionary institution must explain why its choices deserve trust.
The household at the kitchen table does not need a perfect theory before recognizing a loss. But a theory earns its place by helping identify and reduce that loss. “More money” and “more room to live” are different achievements. The politics begins when we stop pretending they are interchangeable.
Recommended reading
- What Has Government Done to Our Money?, Murray N. Rothbard — a concise Austrian critique, presented as a school of argument to examine rather than a settled account of every inflation.
- When Money Dies, Adam Fergusson — historical experience of Weimar hyperinflation; illuminating about institutional breakdown, but not a direct analogy for every modern price rise.
- “Inflation: Prices on the Rise,” Ceyda Öner, IMF — a contrasting institutional explanation of causes and policy responses, to read critically alongside Rothbard.
James Prompt
- TITLE: Rising Stacks of Money
- LEAD: A parody of Money Money Money depicting someone earning good money but inflation making it worth ever less.
- PROMPT: Inflation is the government embezzling money from the people and fundamentally forces speculative investment, rampant consumerism, and distrust between the classes. It particularly benefits the wealthy via asset inflation and lowering the burden of debt.
- CONTRA: Inflation is largely a mystery, an artifact of the greed of capitalists suddenly able to charge more. And if government does benefit, that’s good because government is always investing in improving the lives of its citizens.
- RECOMMEND: Resources on inflation by Austrian economists, a history of inflations across countries