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Inflation is a tax on interest-bearing, interest-indexed, or financial instruments; loans, bonds, debt, and insurance claims (policies are priced in uninflated currency, claims are paid in inflated currency, see the 1980s liability insurance crisis triggered by high inflation, though blamed on much else).

Wage-earners, and fixed-income households if inflation indexed are largely untouched by inflation.



Sure, but I don't see how wage-earners are untouched by inflation?


Fixed payents (bonds, etc) are fixed.

Wage-earners see wages increase with inflation. Possible slight lag, but effectively little.

Cash savings of course devalue.

Asset holdings (real estate, equities) appreciate with inflation.

Debts are reduced -- values fall as money is diluted (the gain side of banks' loss).


That's what I mean when I say poor - no debts, no assets just little savings in money and wages. Possible slight lag is not only possible and not slight, every increase in wages must be battled for while inflation comes automatically, money also represents 100% of the capital and therefore affects the poor completely.


> money also represents 100% of the capital and therefore affects the poor completely.

Per definition the poor don't have much savings. Their wealth is mostly in durable consumer goods: Car, television, furniture, etc. The market prices of these goods rise with inflation.


Consumer goods are not wealth, if they have any it's savings in cash. The cost of eating rises with inflation.


The minimum wage argument is a fair one. All the more reason to index that.


Fair wouldn't be my choice for a word to describe an increase minimum wage every 10 years or so if the political constellation is right, while the rich get handouts every day.


"Fair' == "a cogent and valid point in this argument".

"Fair" != "a socially just policy'.


> Wage-earners see wages increase with inflation. Possible slight lag, but effectively little.

Some wage earners. The poorest of the society work for a minimum wage, and that wage won't be increasing anytime soon.




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