• ikt@aussie.zone
      55·
      2 months ago

      ok but how would that bring down country wide inflation?

      Sorry I had to use mistral AI on my PC to generate this because I cbf explaining

      Unemployment and inflation are inversely related in the short term due to the Phillips Curve—when demand for labour rises (lowering unemployment), wages and prices often increase, fuelling inflation. Conversely, high unemployment typically suppresses wage growth and spending power, reducing inflationary pressures.

      If you’re actually interested there’s a whole article on it here

      https://www.investopedia.com/articles/markets/081515/how-inflation-and-unemployment-are-related.asp

      tldr taxing the richest 1% wouldn’t take a bundle of money out of the economy, and it especially wouldn’t take inflation out of things regular people buy, like groceries and take away because it’s not something the ultra rich have an impact on anyway

      Here’s Australias latest CPI: https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release

      • MisterFrog@aussie.zone
        4·
        2 months ago

        It would be stupidly unpopular, but I actually think there should be some legislated amount the RBA then could regulate how much taxes go up and down. (Including income and/or corporate taxes)

        Starting with the top tax brackets, and in extreme cases going further down tax brackets.

        How this would work in practice, since tax is calculated annually, I dunno.

        Bur it’s patently insane we expect the RBA to control inflation and unemployment with so few tools.

        Interest rate and quantitative easing/tightening, that’s pretty much it, right?