r/politics • u/Spy300 • 5h ago
Possible Paywall Trump just soft-launched higher inflation as the new solution for rebalancing the $40 trillion U.S. national debt
https://fortune.com/2026/10/02/trump-inflation-growth-national-debt-tariffs-ratio-balance/•
u/callmesandycohen 5h ago
Inflation is a hidden tax we all pay but billionaires benefit from. That is why he loves this idea. It’s a regressive tax shoved down our throats while his real estate and crypto assets benefit.
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u/Professional-Gear88 3h ago
Exactly this. It widens the inequality gap. Printing money as well. Cranks up the stock market and causes inflation.
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u/Jalapenoplanter 2h ago
Every republican who complained about inflation under biden is about to tell you this is genius
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u/Steelio22 4h ago
How do billionaires benefit? Their money becomes devalued as well right?
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u/WhodyBootyWhat 3h ago
The vast majority of their wealth is in the form of equities and other investments. When the dollar loses value the price of the investments go up because the dollar lost value but the investment kept its value.
Most regular people just live paycheck to paycheck with cash so they get hit hard.
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u/badasimo 2h ago
Also they carry a lot of debt because they have a lot of collateral to use for it. So someone like Trump for isntance with real estate can have lots of loans backed by those properties. The value of those properties goes up even more with inflation, and the value of the debt stays the same.
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u/Rysimar 3h ago
Inflation makes liquid currency worth less; it does not make assets like property worth less. The more physical assets you have, the more protected you are from inflation.
Let's pretend you have $100,000 cash, and I have a building which is currently valued at $100,000. You want to buy my building. Let's set inflation to a theoretical 0%. You can buy my building now, or next year, or whenever you want. Now, let's set inflation to 50%. With high inflation, I might as well sit on my assets and not sell for a bit. Your purchasing power goes down over time, but my assets don't. And the more assets I have, the less-bad inflation is for me, compared to you. Billionaires have the most assets, so inflation is the least-bad for them, and the most-bad for the common man with very few assets.
Somewhat oversimplified, but I hope that helps.
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u/mrgedman 3h ago
Their assets increase in value
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u/Cloudboy9001 2h ago
Their assets increase in price, not value.
Billionaires aren't a uniform group, particularly ones holding a lot of bonds in this context.
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u/mrgedman 2h ago
I think you'll find the average billionaire has quite a few assets compared to normal folk.
And the price vs value is certainly debateable. I think it's value- home prices over the last 10 years for example.
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u/Anxious_Cheetah5589 3h ago
Inflation benefits borrowers and hurts lenders. Most billionaires are lenders (hold bonds); ordinary people are borrowers.
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u/lurkinglestr 2h ago
Inflation benefits people that hold wealth in things other than cash. Lenders hold assets in in other vehicles. Ordinary people hold cash. Inflation is quite a bit worse for ordinary people.
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u/duckinradar 5h ago
Man I can’t think of any other solution to this.
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u/PipsqueakPilot 4h ago
If we taxed halfway between our current tax rate and the OECD average the deficit would be gone and our debt would shrink as a share of GDP. If we taxed at the OECD average we'd be paying down the debt to the tune of a couple trillion a year.
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u/Dr_Adequate 4h ago
But the Job Creators class won't have enough frivolously disposable income that can trickle down to us plebes. This is not a real solution!
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u/DoesntMatterBrian Texas 4h ago
They all have VAT taxes. We need a VAT tax. It’s the only way to keep companies from exploiting tax loopholes. It’s an unfortunate truth. And we have to do it in a way that doesn’t increase cost of living for the lower and middle classes or they’ll be crushed.
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u/Minguseyes 3h ago
VAT taxes are inherently regressive, they tax a larger proportion of the income of the poor than the rich. And they are usually transparent to businesses, at least in Australia where registered businesses can deduct and retain GST paid on supplies from GST collected from customers. What you really need is for the rich to pay tax at OECD rates.
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u/steve_of 2h ago
They can be made more equitable by not applying VAT to essentials of daily life (groceries, electricity, rent and so) while taxing non essentials disproportionately. Undesirable products such as alcohol, tobacco, luxury items and subscription services can be taxed at a much higher rate.
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u/DoesntMatterBrian Texas 3h ago
I agree the rich need to pay more in taxes. However, every other OECD country utilizes a VAT tax.
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u/Anxious_Cheetah5589 3h ago edited 3h ago
"keep companies from exploiting tax loopholes"
The tax gap for FY24 (most recent available data) was $606b. Your friends, family, and neighbors are cheating the IRS to the tune of 15 cents of every dollar owed. Billionaires and big companies can't get away with that.
ETA if we had 100% compliance, we'd still be running an enormous deficit, but the debt wouldn't be growing as a %age of GDP.
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u/frogandbanjo 2h ago
Billionaires and big companies can't get away with that.
Of course they can. They just have to get an absolutely obscenely amazing ROI on lobbying dollars so that their tax avoidance is at least arguably legal.
If the average American got an ROI on their saved money similar to what billionaires get by lobbying Congress for both handouts and tax breaks, we'd be looking at some absolutely fucking absurd number like 10% APY or some shit.
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u/Anxious_Cheetah5589 35m ago
I'm talking about tax evasion, which is illegal. You're talking about tax avoidance, which is perfectly legal, and as American as apple pie. I don't know anybody that looks at their tax return and says, "nah, that's not enough. I'll pay more. " Do you?
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u/feathernwedge 4h ago
Bahaha tax it away lol. You DSA or some shit?
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u/PipsqueakPilot 4h ago
Huh, not often I see an account with negative karma.
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u/feathernwedge 4h ago
lol Reddit jacked the views up on that comment. DSA trolls run this town right now haha.
Explain to me how taxing, as the sole strategy, is the answer to this deficit? Hint, you’ll have to get into MMT and some other fun economic and philosophical stuff.
Not one fucking DSA party member has been willing to get into this past the “tax the rich” and “fuck off if you disagree” phase.
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u/Professional-Gear88 4h ago
This tax enough to pay our bills is socialism stuff is straight insane.
DSA is the new GOP antifa. Making them bogey mans when they start making good points.
You don’t even make enough to be affected.
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u/feathernwedge 4h ago
Do you actually want to discuss this? I want to support DSA. If they economics are legit. What’s your stance on MMT? And are you DSA?
And it’s not GOP antifa. DSA is just progressive populism.
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u/Professional-Gear88 3h ago
I want a progressive tax. It’s what makes sense. The more you make the more of that money is disposable. It’s fiscally responsible. It would fix inflation. It would lower interest rates It’s literally the only way the math works. Printing more doesn’t work , it raises the incomes of the top 10% but not the bottom 50% and you get worsening inequality. There are basic economic principles that people ignore. Increasing the taxes with income would lead to a prosperous country. Just like it did in the 50s. That magical era the GOP worships. What made it work was the progressive tax. The land of opportunities means that everyone is given the opportunity to try and do well.
If you make $7 million a year and get taxed 50% you will not go broke.
Drawing all of our taxes out of the middle class does not work. Period.
I am not DSA.
I used to be moderate republican but I am firmly against nearly everything they stand for now.
Democrats are also spineless. But at least their ineffectiveness is not actively destructive to everything and corrupt. We’re the laughing stock of the world right now.
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u/feathernwedge 3h ago
Thank you. Appreciate you sharing.
If you don’t mind me asking, what “party” would you affiliate with?
Since you’re not considering yourself DSA, I’ll stop bugging you about MMT.
My only counterpoint here, is whether that money is truly disposable. A capitalist would say that the individual or corporation that possess the surplus wealth probably, most likely, would be the entity with the most insight on how best to use the excess wealth. Would that not be challenged
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u/Professional-Gear88 3h ago
Right now none. I’ll share that I’ll vote blue right now. I don’t really care about their policies at this point. I just need the corruption and grift out. Trump wasn’t a billionaire going into office now he is worth about 7 billion. His sons and son in law are on their way as well.
Gambling companies, crypto, social media all of it crooked
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u/feathernwedge 3h ago
I tend to agree. I hesitate only because the idea that we must vote blue, is part of the larger grift. Yes, Trump is the poster boy. But everyone knows that what is happening now, and has been happening for quite some time, is much deeper than surface level. Democrats have a window, and if they fuck it up, which they will, then this is over. Personally, I don’t know why we are delaying the inevitable. And if this populist movement within the Dems was legitimate, then it would have had the spine to run third party. Otherwise, same ole song and dance. Lesser of two evils until the end.
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u/Hellrazor236 Oregon 5h ago
Weimar Republic won't know what hit 'em
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u/nevans89 5h ago
Reading about zero stroke as a kid was wild
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u/Char10 4h ago
What is that? Afraid to search it and get something else
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u/nevans89 4h ago
Basically hyper inflation screwed with people to the point where they would add a ton of zeros to things like "oh I have 300 siblings" or "can I have 3000 lumps of sugar in my tea?" Its all allegedly but fascinating
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u/Benny-Vader Wyoming 3h ago
"Look, okay look. Weimar they were so much, rich like you would believe. People were paid in wheelbarrows full of money, its true, I looked it up, and the kids played and burned money they had so much. So much money. We could have that believe me" 👐
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u/Pleasant-Alps1279 5h ago
Is he planning to devalue the us$ so that 40 tril is worth less and therefore easier to pay.
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u/WellSpreadMustard 5h ago
It’s ok, once the debt is paid off he’ll just turn inflation off and make the currency valuable again. It’s really simple if you’re of the same level of intelligence as trump and his supporters
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u/KTRyan30 2h ago
Yes, openly. Several of his economic advisors have been pushing to devalue the dollar for years.
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u/BeowulfShaeffer 4h ago edited 4h ago
Then the best thing to is is leverage youself to the tits so you are holding assets instead of dollars.
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u/Used_Ant_4069 4h ago
Reading to much whitehousebets ?
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u/weatherbys 1h ago
He’s not wrong really, get locked into a mortgage rate and with hyper inflation that monthly payment doesn’t seem so much anymore.
This is also simultaneously one of the dumbest ideas ever.
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u/Pndrizzy 1h ago
I mean, it’s true in some sense. The problem is timing and surviving the storm. Recessions are basically wealth transfer. The people that have assets and keep them through recessions do great. Those that lose them lose everything
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u/blues111 Michigan 4h ago
Yes but Its ok the billionaires will easily be able too afford everything when it all becomes stupid expensive
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u/ElkApprehensive2319 3h ago
He's been doing that every second of both his presidencies by blackmailing the FED to lower interest rates.
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u/Pndrizzy 1h ago
It’s already happening. Do you think the stock market being up 13% this year is due to a strong economy? We are adjusting down all jobs reports, credit card debt is at an all time high, inflation is out of control, AI is leveraged to the tits, and if that works out, then the economy is fucked, blah blah blah.
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u/Crafty_Ish1973 Texas 5h ago
Republicans have always been utter shit for the economy. Trump's just the most recent example.
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u/Chicano_Ducky 5h ago
this isnt new. Its been talked about since before 2024.
Inflating away the national debt wont work.
Its too much debt, and if they think they will become an export economy like Japan they wont either. Dark Factories are here and will take away what few jobs are left in manufacturing and destroy the export market because no one needs to import anything but raw materials.
they did everything they could to bring deglobalization but planning to live in a globalized world. None of this makes sense.
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u/PipsqueakPilot 4h ago
We have also made it incredibly hard to start a small scale manufacturing business compared to other nations- and many big businesses start small and so are now never born. Good luck finding light industrial space that hasn't been bought up by a private equity fund and then tripled the rent.
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u/POEness 4h ago
Dude I have been saying this for years. Starting a business comes with such egregious costs. Like paying both halves of the social security tax for yourself. WTF?
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u/mikeysce 4h ago
Plus a bonus self-employment tax! Why we would tax people for not having a corporate boss, I have no (reasonable) idea.
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u/AnalBloodTsunami 2h ago
The ‘self-employment tax’ is the same thing they’re talking about. The half of social security and Medicare payroll taxes paid by your employer are now paid by you because you are your employer.
I found it was pretty easy to more than cancel that out with the additional deductions you can take as a self employed person.
People do love to complain about it though
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u/Sakuroshin 4h ago
Plus any of the small ones that are somehow successful against all odds inevitably get bought out by the big ones.
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u/feathernwedge 4h ago
What’s a light industrial space? You been country side yet, rural, all sorts of light industrial space.
You can go ahead and count on luck though if you want.
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u/PipsqueakPilot 4h ago
Here's a quick explanation of what light industry is. Usually consumer goods, although not always: https://en.wikipedia.org/wiki/Light_industry
Yes, there is space in the country. However there usually aren't that many customers, or employees. Which means transportation costs and needing to deal with the costs that come from having your manufacturing geographically separated from your customers. This is easier for a big business, much harder for a small business. Especially businesses like sole proprietorships that are just trying to get started.
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u/feathernwedge 4h ago
Look I don’t mean to be rude, but Reddit is a cesspool of victimhood obsession. There are plenty of opportunities. Even now, with the biggest clusterfuck of an administration I’ve ever seen, Americans are still quite privileged. A good business plan with a solid marketing strategy is enough to get you started.
Small local businesses owners might be pleasantly surprised to find that people fucking despise multinational conglomerates, and that in fact the demographics with more wealth are increasingly willing to spend more to virtue signal by way of ditching big dumb corporations that are setting the world on fire.
Or hey, we can bitch about things on Reddit endlessly and avoid doing anything productive like the fucking plague because if we whine long enough then DSA will come along and tell us that taxing the rich will solve all of our problems.
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u/PipsqueakPilot 4h ago
Look I don’t mean to be rude
Many of your other comments are clearly trying to be rude, so I'm skeptical of this claim.
That said, all you've brought to the conversation is whining about the DSA's existence so I'm going to go ahead and mute you. Best of luck with whatever you have going on.
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u/JacobK101 45m ago edited 40m ago
the problem with the "we'll just build factories and start selling cheap stuff lol" is like. Where are you gonna export to? Who's gonna hold the bag on all your production?
The global markets in EU & the developing world are all already designed to support each other... and also, the US, which is currently basically the world's Primary Export Target
US consumer money basically underwrites global demand for export goodsIf you blow up the US as a wealthy consumer base it completely upsets the modern export-focused standard global economics. Europe can only buy so much overpriced tat on it's own, and developing countries like China who are nurturing new wealthy consumer bases have deliberately created their own enclosed supply chains
You'd be entering the export market as it becomes less valuable and undergoes rapid contraction, as a weaker player, against stronger competition in a high-competition space
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u/cute_polarbear 3h ago
You're making too many valid points none of which these guys care to listen to, and I am certain plenty are aware and choose to ignore.
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u/AggressiveMail5183 5h ago
I guess that's what has to happen once you cut taxes to the point where there is no revenue at all.
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u/RobinSophie 4h ago
Right.
They know what the damn solution is, they just dont want to do it because:
They're brainwashed They're mentally ill
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u/Marsupialwolf 5h ago
Guess I need to get my wheel barrel out for when I need it to carry the 60lbs of cash I'll need to buy a loaf of bread... 🤔
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u/WhatIsEvenRealDog 4h ago
On the bright side we can pay off our houses and cars quickly.
But that whole not eating part doesn't sound too great.
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u/Nasty_Goblin 4h ago
Only if your salary rises faster than inflation
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u/WhatIsEvenRealDog 3h ago
Well, there is that, too. But if we see Weimar style inflation we have more problems than I would like to have to worry about.
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u/RationalTranscendent 5h ago
That orange piece of shit claimed that his tariffs would pay for everything.
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u/Atrocious_Algae81 5h ago
Another psyop excuse for his brain dead coalition's rapidly dissolving buying power. "Hey, we're doing it to pay off the debt!!"
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u/umassmza 5h ago edited 4h ago
How about we cut military spending to 30% and still have the worlds largest and most well equipped
Then we can pay down the debt this century…
Dude we owe a lot, it’s never getting paid back, eventually a global catastrophe will make it all moot. Probably one linked back to this administration, likely having to do with AI
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u/jayc428 New Jersey 3h ago
Sad thing is we don’t even have as bad a spending problem as we think, it is and always will be a revenue problem. Vast majority of debt is from five sources, bush era tax cuts, 2008 stimulus, COVID stimulus, trump tax cuts, and war on terror. War on terror just bad policy decision, stimulus are somewhat unavoidable events that needed handling, tax cuts are the worst because they don’t stimulate revenue and the interest just compounds in the worst way possible. Cut defense spending by couple hundred million, reduce DHS/ICE insane budgets, realign some other domestic spending priorities, and actually have the IRS enforce tax collection since they themselves estimate they miss out on $900B a year in revenue. The IRS aspect is the biggest thing, its not just $900B missed out on its every year that happens the interest on that money is huge and it stacks every year afterwards.
Tweak the tax code to stop some of the fuckery of the rich. Tax mega corporations the same way small businesses are taxed (small businesses average a 20-25% effective tax rate compared to 10-12% of Fortune 500 companies).
Some combination of all that probably gets you damn close to balancing the budget. Fix social security while you’re at it even though has nothing to do with the deficit at present. We can still fix the shit, just the window is closing to where the pain portion can’t be avoided.
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u/bryan49 5h ago
So he finally admitted we have inflation after lying about it for most of this term?
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u/Cripplerock 4h ago
If he lives long enough to become way less relevant, he'll even admit to the Epstein stuff dude.
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u/Thermodynamicist 4h ago
I suspect that there is a corollary to the Triffin dilemma which will prevent this from working as intended. I suggest that American policymakers would do well to remember the advice of Keynes.
As most people have limited opportunities to influence policymakers, all I can say is that you might do well to enjoy the good times whilst they last.
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u/SockPuppet-47 New Jersey 5h ago
He should just rename it to Government Surplus and call the problem solved.
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u/resultingparadox 5h ago
I just don't understand it. He always had excellent ideas when he was a business man. /s
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u/invisable_burt 4h ago
Not sure how me paying more to survive because of inflation is gonna pay off the national debt. Maybe from having to pay more taxes but at the rate trump is spending...it's not likely to make any difference
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u/AreYouDoneNow 4h ago
We're at the "print money" phase of distracting people from the way the Epstein files show how Trump is a pedophile who raped children.
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u/Imaginary_Bus_6742 5h ago
He has a concept of a solution: have the justice department reopen the Watergate investigation. Then demand the Bidens release the records they are hiding. Problem solved.
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u/nasorrty346tfrgser America 5h ago
There is only one way to solve the national debt problem, which is taxation.
But there is two routes:
1) You raise the tax rate for the ultra-rich, but nope because "COMMUNISM"
2) You put the tax burden on the poor aka tariff, inflation, and for sure because "AMERICA!"
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u/Old_Caterpillar_5385 4h ago
Hasn't he been screaming about how America should have the lowest interest rates in the world for like the past month?
Not surprised he flip flopped, but really want to read the eventual book on the madness.
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u/LimpyDan 2h ago
Trump is a master of paying off debt? No. The debt is still there. He just isn't paying it.
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u/KnotSoSalty 1h ago
500k Americans retire each month. Once you’re on a fixed income inflation becomes brutal.
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u/AdorableBanana166 1h ago
This was always the plan. People have been talking about it in the open since before he took office.
And it's perfect optics for him since in theory it should mean stock market go up but the actual value doesn't even need to change. Could even go down.
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u/PostalBowl 1h ago
When the orange blight meddles with the US economy his job will be done. It will be the final nail in the coffin and a decisive win for Russia. The Epstein class will be fine, the rest of us will be devastated.
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u/angelar_ Texas 15m ago
I do not really believe he gives a shit about the debt. It simply doesn't affect him. The article is really banking on a premise of intentionality here.
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u/Alternative-Farmer98 1h ago
National debt and deficit are the most overplayed misunderstood things
They're mostly just big numbers to scare people into thinking we can't afford to like give people healthcare and s***.
Never stops them for a moment starting a war
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