Circle of Inflation

Serious inflation is within a couple years away. Everything gets to you via oil.  As oil get more expensive everything will increase in price.  It's already happening to basic materials required to make things.  It just hasn't yet been passed on to the public in most cases.  Add to this the massive amount of paper money inserted into the money supply in the form of the national debt owed mostly to China.

Of course, as everything begins to increase in price, governments will find their cost of providing services will increase also.  In many cases they can increase the costs of these services without going to the taxpayers.  Most of these services have already gone up 30% on average over the past few years.  However, much of the desired increases must go back to the voters for approval.

Everyone is told that awful and terrible consequences will result if the increases are not approved.  Benjamin Disraeli said, "There is the damn lie, then there is statistics."  Eventually, awful and terrible consequences seem to result in spite of all efforts to the contrary.

After the increases are approved local businesses must increase their prices to their customers which often includes government procurements.  As everyday costs rise, government employees discover that their income is falling behind, then the bureaucrats do statistical analysis of other comparable municipal areas then demand salary, benefit increases.

Of course, as everything begins to increase in price, governments will find their cost of providing services will increase also, etc., etc.