From time to time during the present inflation (let’s say between 1940 and 1964) violent disputes have broken out concerning who or what caused it. “Labor” and “management” blame each other.

I pointed out in the last chapter that, after 1930, we had cheap money, inflexible or rising wage-rates, and heavy government deficits for the next ten years. As a result, we also had mass unemployment for the next ten years—until World War II finally bailed us out.

Over the last quarter century the American government has displayed a peculiarly schizophrenic attitude toward spending vs. economy, inflation vs. dollar-integrity.

In his classic little history of fiat money inflation in the French Revolution, Andrew D. White points out that the more evident the evil consequences of inflation became, the more rabid became the demands for still more inflation to cure them. Today, as inflation increases, apologists emerge to suggest that, after all, inflation may be a very good thing—or, if an evil, at least a necessary evil.

For years we have been talking about the inflationary wage-price spiral. But Washington (by which is meant both the majority in Congress and officials in the Administration) talks about it for the most part as if it were some dreadful visitation from without, some uncontrollable act of nature, rather than something brought about by its own policies.