Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
I disagree.

Inflation is not per se an action of class war, quite the contrary: core inflation destroys the revenues from capital and is, by definition, constituted by an increase in wages and salaries. Core inflation may be progressive in its consequences. Look for example to the consequences of the WW1 in France: A Society of rentiers (before the war) is replaced by a society of salary-men and women after the war, because it is no more possible for the former landlords to extract enough revenue frome their lands or possesions as before, all of that because of inflation (caused by the need to offset state debt issued to finance the war).

External inflation is due to a resource shock. The only available solution is to answer to this shock. If the constrained resource is energy, as has been the case for some while, you need to find other energy sources, to begin rationning energy or to adapt the society, and therefore the economy, to a rarer enrgy source.

All three have been used in the las (1973) oil shock (at least in France): a new energy source, nuclear power, has massively emerged. Rationning took the form of energy savings, propaganda campaigns and increased energy prices, and energy efficiency has been increased.

Energy efficiency: Green, before 1982, red afterwards

GDP per capita - world average - in constant 2012 dollars (vertical axis) plotted against the world oil consumption in million tonnes oil equivalent (horizontal axis), from 1965 to 2012. Green: data from 1965 to 1982, red: data from 1983 to 2012. The correlation is better for recent years, which shows that the world economy is not less dependent on oil: the dependency has increased, even though we get "more GDP per barrel" today than before.
Author's calculation on primary information coming from BP statistical review & Shilling et al. (energy) and World Bank (GDP).

La chasse au gaspi

The gaspi (from "gaspillage", waste) was this animal, with a funnel on the head, characteristic of the gasoline filling stations at the time (1970-1980) and there was small films and advices to avoid wastes.

The cost of energy (notice external shock inflation on energy prices in the 70's)

by Xavier in Paris on Tue Nov 19th, 2013 at 06:52:25 AM EST
[ Parent ]

Others have rated this comment as follows:


Occasional Series