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Comment by TameAntelope | Hacker News Reader

The article's point is that it doesn't hurt the poor as much, because more poor people can find jobs, pay off their loans more easily, and they do make more money.

Not to mention that the price of everything isn't going up a single number -- poor people can adjust their spending to account for the items that reflect the highest inflation, and focus on the goods that are least effected.

The article isn't suggesting there are no downsides to inflation, it's suggesting that there are substantial upsides that directly address some systemic inequality in global society.

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But the article is wrong - it does hurt the poor. The reason is timing.

Prices go up. Then, later, wages go up. That time gap is hard on poor people. The poorer they are, the harder it is.

Wages going up is not what the article is talking about, wages becoming available is what the article is talking about, as seen by our extremely robust jobs numbers.

But we are already at low unemployment before COVID and all the spending; we don't need inflation to drive jobs growth. It would be worth debating the tradeoffs if we were sitting at 10%+ unemployment with no path for improvement, but if anything, it is the job market starved for labor, not the other way around.

We may need inflation to drive job growth now, and we've definitely needed inflation to drive better job growth. An office job being created because a paper company can support an additional employee due to inflation is a better situation than continuing to work in a warehouse job. Inflation will eventually recede, but that new job will give opportunity to the worker.

Scale that up by a factor of millions across the country, and you've closed the income gap. That's the power of inflation.

The truly poor do not have jobs, nor much hope of one in future. They are on fixed state incomes at best, which if they are lucky may have a trivial rise some years after the fact.

We don't need to get terribly cerebral to note the basic mechanism of proportion, whereby $10 added to the daily food cost of a person who makes $50/day is vastly more impactful than the same $10 added to the daily food cost of a person who makes $500/day.

The whole point is that $10 added daily food cost results in the food producer being able to hire more employees, which means the person who makes $0/day can make $300/day now.

Also these numbers are super weird. It's probably more like $10 total daily food cost going up to like $10.30, and going from making $30/day (part time minimum wage) to $50 (near full-time minimum wage).

The numbers were symbolic to illustrate proportional effect.

I'm not seeing a great deal of causation in your theory. The same amount of food is being produced, thus the same amount of work is done - so extra employees are not required. If anything, in your closed system theory, the food producer is going to laugh and pocket extra profits.

The same amount of food is not produced, more food is produced because it's the only way the food company can keep up with inflation.

Who is buying and eating the extra food? Did human stomach volume increase proportional to inflation?

https://www.nzherald.co.nz/business/the-conversation-inflati...

Show me which countries have wage growth for lower socioeconomic demographics currently matching or outpacing CPI? It is not happening.

Or the reverse: Wages go up, then prices go up. Inflation isn't guaranteed to be one way or the other. It's an aggregate measure.

Can't that same argument be used to lower the minimum wage when inflation is low?

That argument might justify lowering the minimum wage when there is deflation, but not when inflation is low.

At most it could justify lower COL adjustments

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