“The inflation that comes inevitably with government pump-priming soon catches up with the laborer, wipes away any real increase in his wages, discourages private investment, and sets off a new deflationary spiral which can in turn only be counteracted by more coercive and paternalistic government policies” — William F. Buckley Jr.
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William F. Buckley Jr. is warning about the negative economic cycle that can result from inflation caused by excessive government spending and intervention in the economy. The quote suggests that when the government artificially boosts demand through “pump-priming” policies like increased spending or lower interest rates, it initially leads to higher wages for laborers.
However, Buckley argues this inflation will eventually “catch up” to wages and erase any real gains as prices rise accordingly. He believes this inflation then discourages private businesses from investing due to uncertainty.
Buckley claims all of this sets in motion a deflationary spiral that can only be addressed through even more intrusive government policies and control over the economy. Overall, the message is that inflation spawned by pump-priming has unintended consequences and leads to a situation requiring ever-increasing government intervention.