For all the attention that soaring inflation has gotten this year, one of its most surprising direct offshoots has gone largely unnoticed: US government debt is shrinking rapidly.
Not in dollars-and-cents terms. No, that’s growing day by day, minute by minute. But it’s dropping in the way that really matters: when measured against the inflated size of the economy.
Inflation, created by the government’s own actions, deflates the value of the dollar. These cheaper, future dollars are then used to pay off the debts. It’s sort of like a financial scam.
And it is an actual wealth tax on everyone that benefits those who have debts. The Federal government has more debts than any other individual entity.