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Chapter 3: The Choice is Ours to Make

Stable Prices

A small amount of inflation is not harmful,
especially if people predict it, and it occurs on a regular
basis. Inflation can cause problems if it exceeds 5
percent or so a year and is unpredictable. High and
unpredictable inflation can lead to unemployment
because it can diminish consumers’ buying power and
thwarts risk-taking. People who live on a fixed income
are the most hurt by inflation.

Fairness

People still come to America because they believe
that our economic system is fair and rewards hard work.
However, the concept of fairness can be a relative thing.
Is it fair that some people have more money than
others? Should society choose to strive to have an even
distribution of income?

Europe has built such massive and expensive
social programs that almost everyone became a
recipient of government largess. Europe neglected pro-
growth policies in return for income redistribution to
the point that some countries, like Greece, went
bankrupt. In contrast to Europe’s generous social
programs, President Trump’s policies pay less attention
to income distribution and place more emphasis on
economic growth. President Trump is interested in the
opportunity of upward mobility more than he is in
fairness.

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