highways -- circa 1957

[Max Sawicky]

> Michael Cohen wrote:
> > 
> > My recollection is this is one of the "benefits" of the cold war.
> > The Highway trust fund, as well as the internet was sold
> > as a military necessity having to do with I believe troup
> > transport in the event of a war or invasion.
> >  --
> Wasn't it called the "National Defense Highway System" or the like in
> the Act that authorized it?

Yes.

 
> Totally unrelated question:  Since the US government can control the
> supply of money via policy (essentially owning the dollar printing
> press), wouldn't it be possible for the gov't to slowly inflate its way
> out of debt?

In theory, yes.  To some extent this happens as a
matter of course.  An inflation of X percent devalues
the pre-existing debt by that same amount (as it does
all other debt).

In practice this would not be a great idea, as it
would unsettle routine credit purchases of the Federal
govt.  Nor is it particularly necessary.  There is no
problem with the existing debt.  It can be carried
indefinitely.  

 > It worked for mortgaged homeowners in the late '70's.  Or
> does this send the transfer of wealth heading in the "wrong" direction?

Yes, hence one factor underlying a progressive interest
in a mildly inflationary policy (the other being
upward pressure on wages and employment).

MBS