Whats the difference between inflation and inflation tax?
I get that people seem to be using the term inflation tax as a metaphor for understanding inflation, but it seems to be a bit more than that. We all know that inflation reduces the buying power of our dollar, but I dont see how tax is a useful metaphor for this notion. It would be a useful metaphor IF the goods and services we provide went to the government, but thats only true for some. A business usually isnt providing goods and/or services to the government, its usually to the general public or another business. For the term tax to be used with inflation requires that the government funds their spending using inflation. But I dont see how the government can fund their spending (effectively) using inflation.