But there are nevertheless three conclusions that seem to follow from our critical examination of the possibilities of inflationary policy. In the first place, all the aims of inflationism can be secured by other sorts of intervention in economic affairs, and secured better, and without undesirable incidental effects. If it is desired to relieve debtors, moratoria may be declared or the obligation to repay loans may be removed altogether; if it is desired to encourage exportation, export premiums may be granted; if it is desired to render importation more difficult, simple prohibition may be resorted to, or import duties levied. All these measures permit discrimination between classes of people, branches of production, and districts, and this is impossible for an inflationary policy. Inflation benefits all debtors, including the rich, and injures all creditors, including the poor; adjustment of the burden of debts by special legislation allows of differentiation. Inflation encourages the exportation of all commodities and hinders all importation; premiums, duties, and prohibitions can be employed discriminatorily. Ludwig Von Mises
About This Quote

This quote explains the difference between inflationary policies, which are based on discrimination, and other types of intervention that are not. The inflationary policy focuses on being able to help one group of people at the expense of another group of people. This is clearly wrong because there is no way to tell who will be helped and who will be hurt by this type of policy. The other types of intervention, however, focus on making everyone better off and do not discriminate.

Source: The Theory Of Money And Credit

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