OF INFLATION
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Abstract
We have been planning for sometime to devote a Review of the Month to an analysis of inflation, a subject which is at once omnipresent, increasingly painful, and little understood. While we were in the process of discussing the most useful angle of approach and lines of argument, we received from our friend Jacob Moms an article on precisely ,this subject. It says what we think, and does it so welI that we decided to present it in this space, adding our own commendation and endorsement. Naturally, as Jacob Morris would be the first to agree, no brief analysis of inflation could deal with all aspects of the problem, and our choice of what to emphasize and what to omit would not have been exactly the same as his. In particular, we would have been inclined to pay more attention than he does ,to the historical context of the present inflationary proc~j~ the <:a:pitali~t world. This context includeathe dominance in the ad,~~~d countries of giant aggregates of monopolistic capital; their sb:t!ggle.for wor1a-Widepreference in markets, raw material sources, and, investiIieiiF ~tu_IliJies;the emergence of alternative social systems which'otbreatim the very existence of capitalist class rule; and above all the rising' ITdii tilthe Third World of struggle for national independence and social revolution: These factors have introduced new inflation-biased forces into the fWie: tioning of Capitalist economies which were not present in the past, even thoUgh, as Jacob Morris nghtly insists, thatpasf-was characterized by countless inflationary episodes. But even more important, the gigantic national and international struggles of our time have generated' aI1unPrece,clentecfgrowth of militarisrn.which now ~~s.~I!_~Il0I'Il101Jll JllJldapJla.:I~ ling) proportion of humanity's productive resources. Under these circumstances, governments of capitalist countries, developed and underdeveloped alike, are driven to pursue what Jacob Morris calls the Keynesian inflationary strategy whether or not they ever heard of the English economist in whosehonorthe strategy is named. Ram~nt mi~~II1: ~~d_~.at:!£~_~~_~s inseparable as Siamese twins: they W~l" eliller1lve ana grow togetner or die 'together. But these are matters of focus and emphasis, not disagreement. And