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Dumb Fed's Inflation Fight: Raise interest rates instead of Reduce workweek length

          Federal Reserve
  1. Inflation Fight: When the Federal Reserve raises interest rates to fight inflation, the Fed effectively reduces the overall workweek and reduces average worker's income. Less money means less inflationary pressure. Voila. Simple solution to inflation ... if no downstream ugly complications.
  2. Acute Collateral Damage: As unfolding in mid-March, 2023, the Fed's recent and predicted interest rate hikes had unintended collateral damage: Creating potentially the worst financial crisis since the 2007 financial crisis that could be worse than the 1930's Great Depression.
  3. Chronic Victims: Unemployment begets hell-on-earth . More jobless workers means more abuse of drugs, spouses and children as well as road rage and workplace violence. A 1% rise in unemployment (1.6 million) is matched by 32,000 suicides. Directly reducing the workweek so everyone remains employed would eliminate the Fed's morbid approach to reducing inflation. No recession. No depression. When people know that the workweek length will be adjusted then they will have the emotional stability of hope. Statistically current full employment at declining slave wages without hope of future emancipation is not cause for hope but for hate.
  4. Unions caused the welfare state: Observing rising unemployment in the 1930s, a US Supreme Court Justice proposed reducing the workweek length to keep full employment of all Americans. Like the new farmers in Animal Farm, unions said "No way." Instead of reducing the workweek to addressed unemployment, big-eared FDR cranked up the money printing presses per John Maynard Keynes' economic model. Voila. The welfare state and national debt.

    Inflation: The Lost Time Indexed by Inflation (index)
  5. Inflation Cheapens Your Worktime: If you save 100 hours of wages but inflation reduces the saving's buying power by 50%, it is as if you only worked half of the time. Inflation steals the sweat of your brow. An annual 10% inflation rate without a corresponding wage hike effectively cuts your 40-hour workweek to 36 hours of compensation.
  6. Unemployment, the worst kind of inflation: Whereas a 10% inflation rate effectively cheapens a worker's workweek income by 10%, unemployment imposes a 100% inflation rate. The cheapening nature of inflation can be seen in its semantic cousins, flattery and flatulence.
  7. Inflation is an inflated word (poem): One has more money but less buying power. Why? Economist forget the origin of currency: What is your time currently worth. Thus, they don't strive to keep the symbols of worktime married to substance of worktime. Wealth becomes divorced from worth. Privileges (private laws) are legislated by the re-election of addicted public law-makers to enrich their contributors. (see Currency: Symbols or Substance).
    1. Monflation: More money chasing same amount of goods and services. When politicians turn on the money presses to spend their way out of economic problems. A historical lesson: "Nothing prepared the German people for the excesses of Hitler as the Inflation."
    2. Sinflation: Same money chasing shortage of goods and services. Politicians enable greedy corporations to metastasize false shortages, e.g., Enron, steel, food, gas and oil. Sinflation will become a bigger component of overall inflation as our CO2-sins against Mother Nature causes her droughts, deluges, fires and storms to destroy global agriculture: Shortages of food in an overpopulating world.

      (If this is a truncated version of the essay, visit www.DumbFed.org for the full essay.)

      Productive Deflation
  8. Deflation, the Boogie Man: Most economists embrace inflation as better than the deflation of the 1930s. But, if measured in human time, the 1930s deflation was a period of inflationary cheapening of worktime with the massive unemployment being 100% inflation.
  9. Productive Deflation: As inflation is a two-sided coin (monflation and sinflation), so is deflation. It can come from over-supply of products or under-supply of money. (Witness retailers 2023 response to the collapse of the Silicon Valley Bank: They quickly cut prices (deflation) by 40% or more to have cash flow.) The 1930s deflation resulted from the former Secretary of Commerce and 31st President (Hoover) restricting the money supply. This caused the massive individual inflationary suffering of 25% unemployment.
  10. Lower Prices from Productive Deflation: If measured in the true cost of anything (the substance rather than the symbols of time) Henry Ford's assembly line was an example of productive deflation where the cost of the Model T dropped from $850 in 1908 to $360 in 1916. Increased productivity on the farm reduced the number of farmers from 40% in 1900 to 1% today.

    Inflation/Deflation: Blood Pressure Analogy
  11. In principle, and as part of the 1913 rationale for the Fed, one can compare the actions of the Fed to the body's blood pressure.
  12. Previously, gold and silver production increasingly failed to match the growth of the economic body which was effectively deflation or low blood pressure. It is like a baby's body being limited to its original blood quantity instead of the normal adult's six quarts of blood. People and economies die when drained of blood. Currency is the blood of an economy. The Fed was supposed to increase currency supplies to match the growth of the economy.
  13. Monflation is analogously high blood pressure which will kill you and kill an economy. The Fed has consistently fostered an inflationary policy.
  14. Economic chaos and collapse historically has been a combination of high and low blood pressure. Politicians cause bipolar currency instability by legalizing economic leeches, vampires and phlebotomists that suck the life fluid out of our future economic well-being.

    Federal Reserve: Inherent Structural Inflationary Transfer of Wealth
  15. No Bail-Out: The Biden's administration quick two-day reversal of  the initial "no bail out" is a de facto stimulus package of more money chasing the same or lesser products. The replaced money is somewhere stimulating higher prices. Biden's March 13 early morning "safe, safe, safe" pronouncement to reassure was not reassuring as a fourth bank was reported to be going under.
  16. Fed's 2% inflation rate: It is galling to hear the Fed's chairman pridefully proclaim the Fed's goal of 2% inflation. Why not 0%? Why not 2% deflation where the dollar buys more each year with workers' savings rising in buying power?
  17. 2% for the top 2%: Economists co-enable law-makers to over-privilege a few by de-privileging the many in our zero-sum world. Each unearned privilege is inflationary, a cheapening of currency for the many. The Fed's higher interest rates are a private taxation like oil companies raising gas pump prices for record profits. Who benefits from higher interest rates? Workers or bond-holders? Which political party has voted the most for deficit spending? Which White House has the highest share of the national debt? Yes, Democrats tax and spend. But, Republicans borrow and splurge because they own the interest-bearing govenment bonds.
  18. Inflationary wealthfare for the rich, welfare for the poor: Amazingly, too many American workers vote rich and live poor. They unquestioningly buy into the real fake news from news organizations owned by and for the rich.  Uber-rich Rupert Murdoch's Fox News perpetuating the election lies is a classic example. Low information thinkers buy into and echo the latest confusing and misleading dog whistles, e.g.,woke, socialism, liberalism, etc. (When you hear a low-brainer complain about socialism, ask if they are going to burn their Social Security check.) Every welfare dollar is matched, easily, by $100 or more of inflationary unearned wealthfare dollars. But, the news media (owned by the wealthy, e.g., Fox, ABC, CBS and NBC) lambaste welfare recipients while being mum on wealthfare. Fake news comes from the liar lips who preaches the truth will set you free. Half-Truth Hannity, Igknowant Ingraham, Conman Carlson and Maligner Maria. The epitome of "vote rich, live poor" is Trump's MAGA base.
  19. Fed's Historical Cheapening of Money: Since the Fed's inception in 1913 by bankers, the buying power of the 1913 dollar has been reduced to 1.5% (2023). How did this happen?
  20. Fed's 2% goal: Any economist who accepts the Fed's target inflation rate of 2% should be barred from public policy-making, or, better as Shakespeare might say, "The first thing we do is kill all the economists," more specifically the monetarists.
  21. Forget the funny numbers on funny paper: Economists are criticized for knowing the price of everything but the value of nothing. The real value of anything is its time value on your life. Time is the thread in the fabric of life.
  22. Dollar is Dying: As a problem-solving tool, the dollar is dying. Needed is a currency that is kept constant and current in its worktime value. Timism offers the shovel-ready lifehour. (How to calculate what should be the international currency exchanged rate based on the cost of living.)
    Personal note: Our bank informed us that we need to pay off the equity line or re-finance at a higher interest rate. Did the bank's cost of managing old loans go up? No. Did bank share-holders now make more money off old loans?

    Dys-employment: Un-, Under- and Mis-employment ... a legacy of the Federal Reserve

  23. Wasted Years: In 1990, 50% of college graduates could not get a job in the field for which the studied for 4 years. It is worse today as many universities are eliminating humanities for job-training. (This is especially true for those who went to college for job-training instead of an education to liberate their mind and values from an unquestioned life.) In effect, we are teaching hungry people to fish but denying them access to the fishing holes, e.g., useless job training.
  24. Boomerang Babies: In 2015, 90% of college graduates depended on their parents for some or all of their living expenses. Empty-nesters become home for boomerrang offspring.
  25. Millstone of the 40 hour workweek: The 40-workweek is a millstone destroying America's future. Instead of converting time-saving technology into a shorter workweek, the increased productivity became more wealth for the wealthy and more climate change gases for Mother Nature. 24in4 can recapture the lost time-saving for the average worker.

    Job-hogs: Igknowant, self-enslaved, hypocrisy, and fools
  26. Igknowant Job-hoggers: They stupidly deny others the chance to work. The working muddled-class are the tax source for food and shelter. Instead of multi-million tax-dollar "projects" that become ghettos, why not let the dys-employed work and pay for their own cost of living?
  27. Self-enslaved Job-hoggers: Taxes take 40% of wages, most of which goes to subsidize the dys-employed. In simple terms of jobtime, it means the job-hog works16 hours each week for those denied gainful employment.
  28. Blind Hypocrisy of the Job-hog: No one can tell me how much I want to work. But is that not what the job-hog is saying to the dys-employed who cannot work as much as they need to work?
  29. Job-hogs are fools: The cost of dys-employment is borne by the job-hogs in more ways than higher taxes: higher rates of crime, insurance and stress.

    24in4: Share Job Time or Jobless Crime
  30. Better Workweek: By optimizing workweek length for economic and emotional stabilty we can have a 24-hour workweek in 4 years with more time and buying power for self, family and community in a safer, saner world.
  31. Sharing the Fishing: Yes, better to teach a person to fish rather than daily doling out fish to the hungry. But, as education without the work ethic is useless so is not allowing a trained fisher to fish. Analogously, teaching self-esteem affirms a person for a day while teaching teaching the work ethic affirms a person for life ... if you let them work. Work is solving real time-wasting problems ... not the metastasis of play which causes time-wasting problems. Work saves and creates time. As a creator, one self-defines oneself as an intelligent, worthwhile human being. Work sharing deflates the number one social, economic and political problem: Dys-employment.
  32. Systemic Change: 24in4 to re-capture the lost time since the 1930s.

Shorter workweek to save life on Planet Earth:
The Primary Moral Imperative.
Since 90% of climate hell CO2 is from unnecessary production of human wants, 90% of the 40-hour workweek is killing life on earth. Only 2% of population produces the needed food to stay alive. A homeless person generates less CO2 than an over-timing workaholic.The real fight for reducing the workweek length is not economic fairness but environmental survival. We need better democracy to educate humanity to replace the values of malignant materialism with the morality of minimalistic mentalism. This fight will be lost.

Monetarism Critique (index)
  1. Monetarism is an economic model predicated on playing games with funny numbers on funny paper without regard to the "quality" of the economic transaction. Per Timism's existential model of "Morality of More Time,", quality is equated with the transaction's creation or destruction of time. Bean-counting monetarists don't care whether the beans are lentils or castor.
  2. Quantity, not quality, counts. A high velocity of circulation will earn the originator a Nobel Prize even if the money is chasing Gresham's Law.
  3. It is not enough to be busy. So are the ants. The question is: What are we busy about? (Thoreau)
  4. Monetarists are simpletons who are good at simple math but are either flummoxed by or deceitful of the calculus of monetary quality.  They know price of everything but value of nothing.This simplicity is behind the Federal Reserve increasing interest rates without regard to the impact on the quality of workers' lives. A monetarist thinks and argues for more money even if it is from increased gambling and play.
  5. As one cannot often see the forest for the trees, monetarists cannot see morality for the money. They defend their economic thievery with "And, it is legal" a sure sign that it is immoral and that politicians have been bought to legalize economic theft. Tools of theft in order of impact: gun, computer, politician and economist.
  6. Economic Engine: Monetarists measure and manipulate economic well-being by the quantity of money going into the consumers' pockets. Does not matter if high or low octane gasoline. Or, even plain water.
  7. Monetarism is a multi-faceted economic cancer significantly contributing to the overall accelerating synergistic existential meltdown that will inevitably destroy human civilization. Collapse can be stopped with the simple expediency of a fixed low-interest rate with an optimal adjustment of the workweek length. (Kill it before it kills us)
  9. Timism, the Morality of More Time: Every event/entity has a quality time value based on creating or destroying existence for self and others. Timism proposes and provides a working economic model based on keeping current the time value of currency. Time is the thread in the fabric of life ... the gravity of existence.

Summary:

The Fed's fidgeting interest rates to fight inflation causes acute uncertainty for the business community and chronic chaos for the human community. It is probably safe to say the business leaders, corporate investors, and everyday Americans would prefer a fixed interest rate with weekweek adjustment. The Fed already collects the data to quickly implement workweek reduction process.

Inflation is a Medusa, a many-headed monster. All inflationary sources involve some people living beyond their means with the under-means people paying higher, inflated prices. The worsening, number one cause of inflation is climate change. Drought, fires, floods and storms are destroying the food chain in a world of more mouths to feed: 67 million a year. Everyone is increasing their cost of service due to higher food costs ad infinita. Climate hell indexes how humanity has lived beyond its means in abusing a time-saving product (oil) to cause future time losses. Inflation is an igknowance tax. If we do not tax our igknowance to stop climate change, igknowance will endlessly tax us till it stops us.

Life on earth can survive global economic collapse. Can life survive the accelerating synergistic existential meltdown fueled by fossil fuel fools? Igknownance of the law is not excuse. Igknowance of Mother Nature's Laws is no escape.

I support fighting inflation by reducing workweek,
not by raising interest rates.
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Copyright 2023 Robert Steven Barnett

About the writer
  1. Completed undergraduate cum laude at the largest Illinois university (29,000 students) in just over two years (transcript)... one seven-course semester was aced for 24 credit hours ... completed year of pre-med organic chemistry in two months as an overload. In US Navy scored record high on comprehensive final of electricity/electronic school.
  2. Resume of a polymath: When successful in a new field, moved onto a new curiosity.
  3. Writings:
    1. Currency: Symbols or Substance
    2. Ecos Nomos: The Needed Economics
    3. Other writings
  4. Climate Change, aka Global Dying (essays)
    1. 1982 Oil Droughts: Predicted worsening droughts with downwind deluges
    2. Hydrophilia (a closed loop)
      1. The simple, molecular 'smoking gun' of droughts, fires and deluges.
      2. Why California's atmospheric rivers will be annual, worsening weather events.
    3. Carbon Dioxide: The Global, Multi-Tasking Killer Molecule
  5. Timism: The Morality of More Time, aka the Periodic Table of Existence (a TOE)

(If you read this far, you have a high iCube: Integrity of Intellect and Information.)

Have given a lot of thought to the process of reducing the workweek as a key to reducing the most expensive social and economic problem, that is, dys-employment. In 1998, ran as an independent for Congress receiving one-fourth of the vote with 24in4 being part of the campaign. I am available as a consultant to explain the do's and don't's to transition from dumb interest rate manipulation to an elightened social, economic, political, and, most importantly, climate policy.

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