Inflation Disproportionately Hurts the Poor | Hacker News Reader

Inflation Disproportionately Hurts the Poor

wsj.com

30 pointsthrowkeep26 comments

Unfortunately I can't read the article because it requires a subscription.

The conclusion is surprising to me though - poor people generally spend what they get paid on what they need. I would have assumed that this means that if their pay is increasing at the same rate as their costs, inflation isn't hurting them much at all.

If their pay isn't increasing at the same rate as their costs, I'd consider that a phenomenon different to inflation, and blame that.

On the other hand, it seems like inflation would hurt people with large quantities of uninvested cash the most.

Yep. And even when the cash is invested, it forms a wealth tax whose value is inflation rate multiplied by capital gains tax rate.

Minuum wage isn't going up. It's a huge problem.

Analysis that suggests that actually debt getting inflated away is a major factor and results in people in debt being disproportionately helped by inflation: https://www.lynalden.com/inflation/#benefit

Welfare disproportionately goes to the poor for these sorts of reasons.

Sounds cyclical.

This got me curious. Some quick googling indicates that likely isn’t the case. Apparently the US spends about double on corporate subsidies than the amount it spends on social welfare programs.

I would group Social Security, Medicare, and Medicaid with social welfare programs, which are 60% of federal government expenses.

https://www.thebalance.com/u-s-federal-budget-breakdown-3305...

The calculations also get tricky because there are lots of state and city level spending that would have to be accounted for, such as things like funding public schools.

I don’t know that I’d count Medicare since it’s not for the poor, it’s for people over 65 regardless of income. Social security also goes to everyone regardless of income. Calling public schools a welfare program disproportionately allocated to the poor seems like a stretch too.

Medicaid makes sense though, which is apparently about 10% of the federal budget.

Medicare requires having paid into it for at least 10 years, and I believe there is some convoluted means testing going on with all the different “Parts” of Medicare and how much one’s premiums and benefits are.

Social security is similar, see my other comment.

> Calling public schools a welfare program disproportionately allocated to the poor seems like a stretch too.

It's not he's saying. He's saying that public schools should be considered part of the "welfare program". Which they probably should since public schools, like social security, are program that benefit society as a whole, which you can (or cannot) use depending on your personal situation.

Someone else notes that those program tend, on average, to mostly benefit poor people - which they probably should. But it's not systematic.

So I don't really see any taxonomy issues here.

Social Security isn’t a “social welfare program”. It is a government-mandated retirement investment fund.

There are varying degrees of means testing and wealth transfers happening with Social Security, seen when the government changes the age one starts receiving benefits and the amount of the benefit (and which cost of living adjustment to use). It is not a cut and dry case of social welfare, but it is also not a “what you get is what you put in” program either. I think it will only become more and more means tested and more akin to a social welfare program though.

By that logic universal healthcare isn’t a social program either, it’s government mandated health insurance.

24,000 business declare bankruptcy a year. Wouldn’t those also count as ‘poor’?

https://archive.is/EhxQr

We should have policies to make the poor less poor.

These are work really well for business too, unfortunately they are small local businesses, not the kind who have the ear of government.

China just lowered the threshold for poverty, bam 300M poverty free. What are you solutions?

I went to the hardware store and asked for a ladder that didn't have a lowest rung.

I walked out disappointed.

And we must make sure that lowest rung is firmly planted in the mud, right?

So (for the sake of this story) I'm a bit taller than average, and still growing! It'd be more efficient if the rungs were adjustable.

So I went to the hardware store and got a ladder with adjustable rungs. Then I adjusted the lowest rung up to make it a bit higher.

You still stepped on the lowest rung first, non? No matter how high it was off the ground, it was still the lowest rung and stepped on first.

Wouldn't it be better if the ladder didn't have a lowest rung?

I think the metaphor may have broken down. I am curious though, can you tell me your line of thinking?

https://news.ycombinator.com/item?id=27575872

were you quoted?

google search: https://www.google.com/search?q=%22We+should+have+policies+t...]

Also wsj: Increases in rents are not 'inflation'

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