By following the various declarations, debates and other analyzes that accompany the current electoral sprint as usual, I have noticed that all these fine people are striving to find ways to mitigate the impact of inflation on the population: taxes (for the duration of inflation, we hasten to point out), gift certificates for those most in need, etc. It must be recognized that this is a provincial election, and the provincial power has no real leverage to fight inflation at the source. It is therefore not surprising that most parties have similar suggestions.
What surprises me is that none of the protagonists thought of including in their promises a clause concerning the indexation of salaries to inflation. I expected that at least the left — QS or PQ — would linger a bit on it. All the rhetoric focuses on mitigating the immediate effects of inflation, creating a false perception among the public that once we get out of the woods, it will be back to normal, that is to say a controlled inflation of a few small points, and then we can emit a big sigh of collective relief.
The rise in inflation, as an index value, is of course temporary. Economic activity will eventually emerge from this slump. The excess liquidity, generated by the various government measures during the coronavirus crisis here and elsewhere, will eventually be absorbed by the readjustment of prices that we are witnessing. What will remain are the new prices.
A return of inflation below the 3% mark will not bring consumer prices back to their previous levels. Price increases will remain. There is no precedent for prices, once rising, to have come down again, except in the event of a total collapse of the economy, which would, moreover, render any discussion of inflation obsolete.
Without wage indexation, inflation will ultimately result in a significant cut in the real wages of the population. One wonders: why this widespread radio silence on the subject?
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