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Inflation: A hidden tax

Date: 12/18/2012

Inflation affects everyone, seniors with fixed incomes, working families, the poor and young people.

Inflation affects our businesses, jobs and economy. Higher prices we all pay for food, gas and necessities reduces our discretionary income. Money we could spend buying other items, going out to dinner or movie. This decrease in purchasing power further strains our struggling economy.

This reduction in the economic activity means lower sales tax and income tax revenues to our state. The economy works best when people have more of their money to spend and invest. Money goes back into government coffers fast enough through sales and income taxes.

Do you believe the government or the media when they report there is no inflation? In fact, the dollar has lost 40 percent of its value in the last four years and 97 percent of its value since the Federal Reserve was created in 1913.

When our currency loses value, it affects the value of everything measured in dollars, from a barrel of oil, your paycheck, to the value of your home and other investments. Everything you own is now worth 40 percent less than it did four years ago.

What has caused this drop in our money? The Federal Reserve, a private central bank prints money out of thin air and loans it to our government, at interest to cover government spending that exceeds tax revenues.

In each of the last three years, the federal government borrowed $1.2 trillion, or 40 cents of every dollar it spends to pay for President Barack Obama's expansion of government and failed stimulus programs, including financial disasters such as Solyndra, a company producing solar panels at three times the cost of the competition. It went out of business in about a year, costing taxpayers $500 million.

Would you get a credit card in your children's name and then use it to buy yourself a bunch of presents? That is exactly what Congress and the president are doing.

Isn't the heart of the matter that federal government is too big and spends too much? A partial audit last year revealed Ben Bernanke loaned European banks $17 trillion.

Artificially low interest rates helped create the housing bubble, and discourage people from saving money. The Constitution says "only Congress can coin money" and "regulate the value."

Instead of Congress issuing debt free United States notes, all of our money is Federal Reserves notes created out of debt. It is a debt based money system. Here is one problem. If all of our money were created out of debt to be paid back at interest, where would the money come from to pay the interest? Wouldn't we have to borrow that too?

The loss in value of the dollar affects everyone more than any tax increase. It is a game we cannot win. The federal government simply must live within its means and stop borrowing money and burying Americans in debt we cannot hope to pay.

Call your congressmen and senators and ask them to support auditing the Federal Reserve and cut the size and spending of government.

Dan Allie