Keynes on Lenin on Inflation

This quote from John Maynard Keynes is not comforting in the least: “Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate secretly and unobserved an important part of the wealth of their citizens. By this method, they not only confiscate but they confiscate arbitrarily, and while the process impoverishes many, it actually enriches some. As inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors (which forms the ultimate foundation of capitalism) becomes so utterly disordered as to be almost meaningless. And the process of wealth-getting degenerates into a gamble and a lottery. Lenin was certainly right. There’s no subtler, no surer means of overturning the existing basis of the society than to debauch its currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.” (From The Economic Consequences of the Peace, quoted in R. C. Sproul, Jr., Economics for Everybody)


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