[DRAFT] Inflated Concerns

[Sensorland]

I'm not entirely sure about the title, but it'll do for now. Anyway, this is my first attempt at an issue in a long time, so I'd love to hear some feedback.
Current draft:

Title: Inflated Concerns

Validity: Very strong economy, not fully centrally planned, not fully laissez-faire

The issue: Your economic advisors have noted that the level of inflation in @@NAME@@ has, for the past few months, consistently fallen short of the central bank’s target. They monotonously explain to you that this is a sign of slowing growth in the economy, and can be associated with unemployment and low consumer confidence. Several advisors and bystanders begin pitching their solutions to you as you fight the urge to drift off to sleep.

Option: Your top economist is in a frenzy. “This is really bad, @@LEADER@@,” @@HE@@ says. “We might be looking at unemployment, stagnation, or even…” @@HE@@ shudders, “...deflation. Not to fear, though, there is a solution! We can put more money in the economy by buying back government bonds and reducing the amount of @@CURRENCY@@ banks are required to hold. That’ll get money circulating and our economy back on track!”
Outcome: the central bank takes extreme measures whenever the economy falls slightly short of projections

Option (validity: must have physical currency): “Classic move of the economic elite to suggest putting more money in the economy by way of the rich,” comments one of your younger aides. “You can’t trust the banks and stockbroker types. If you need more money in the economy, why don’t you just print more @@CURRENCY@@? That way, it’s ordinary people who feel the benefit.”
Outcome: citizens carry around huge stacks of cash in case they feel getting a snack from the vending machine

Option (validity: must have computerized currency): “Classic move of the economic elite to suggest putting more money in the economy by way of the rich,” comments one of your younger aides. “You can’t trust the banks and stockbroker types. If you need more money in the economy, why don’t you just add more @@CURRENCY@@ to the system? That way, it’s ordinary people who feel the benefit.”
Outcome: citizens buy dedicated servers to store their digital wallets

Option: @@RANDOMNAME@@, a noted economic libertarian, has barged in to contribute @@HIS@@ thoughts. “Typical of you government cronies to think the way to give people money is more meddling in the economy. If anything, you should cut taxes and give us all a break. Sure, we might have to lose some education or healthcare or policing, but at least your little underinflation problem will be solved.”
Outcome: crucial government programs are being cut to give Johnny Taxpayer some extra spending money

Option: “I must be going nuts! One day they’re all on about the dangers of inflation, and the next they’re saying there’s not enough of it?” muses @@RANDOMNAME@@, a random pedestrian who seems to have stumbled into your office by accident. “I mean, what’s next, are they going to tell me too much exercise is a bad thing? @@LEADER@@, ignore these stuck-up elitists and listen to what real people think!”
Outcome: the government’s new economic policy is based on “the general vibe of things”

Title: Inflated Concerns

Validity: Very strong economy, not fully centrally planned, not fully laissez-faire

The issue: Your economic advisors have noted that the level of inflation in @@NAME@@ has, for the past few months, consistently fallen short of the central bank’s target. They monotonously explain to you that this is a sign of slowing growth in the economy, and can be associated with unemployment and low consumer confidence. Several advisors and bystanders begin pitching their solutions to you as you fight the urge to drift off to sleep.

Option: Your top economist is in a frenzy. “This is really bad, @@LEADER@@,” @@HE@@ says. “We need to take drastic action, or we’ll be looking at unemployment, stagnation, or even…” @@HE@@ shudders, “...deflation. Let’s go all out on monetary policy: we can start by conducting open-market operations, then lowering the reserve requirement…” @@HE@@ notices the blank stares @@HE@@’s getting. “Er, we can solve our problems by putting more money in the economy.”
Outcome: the central bank takes extreme measures whenever the economy falls slightly short of projections

Option (validity: must have physical currency): “Uh, what are you even talking about?” asks one of your younger aides. “Why bother with the banks and rich stockbrokers? If you need more money in the economy, why don’t you just print more @@CURRENCY@@? That way, it’s ordinary people who benefit instead of the mega-rich.”
Outcome: citizens carry around huge stacks of cash in case they feel getting a snack from the vending machine

Option (validity: must have computerized currency): “Uh, what are you even talking about?” asks one of your younger aides. “Why bother with banks and rich stockbrokers? If you need more money in the economy, why don’t you just program more @@CURRENCY@@ into the system? That way, it’s ordinary people who benefit instead of the mega-rich.”
Outcome: credit transfers have started to take an excessively long time

Option: @@RANDOMNAME@@, a noted economic libertarian, has barged in to contribute @@HIS@@ thoughts. “Typical of you government cronies to think the solution is more meddling in the economy. If anything, you should cut taxes and give us all a break. Sure, we might have to lose a little education or healthcare or policing, but at least your little underinflation problem will be solved.”
Outcome: crucial government programs are being cut to give Johnny Taxpayer a little extra spending money

Option: “I must be going nuts! One day they’re all on about the dangers of inflation, and the next they’re saying there’s not enough of it?” muses @@RANDOMNAME@@, a random pedestrian who seems to have stumbled into your office by accident. “I mean, what’s next, are they going to tell me too much exercise is a bad thing? @@LEADER@@, ignore these stuck-up elitists and listen to what real people think!”
Outcome: the government’s new economic policy is based on “the general vibe of things”

Title: Inflated Concerns

Validity: Very strong economy, not fully centrally planned, not fully laissez-faire

The issue: Your economic advisors have noted that the level of inflation in @@NAME@@ has, for the past few months, consistently fallen short of the central bank’s target. They monotonously explain to you that this is a sign of slowing growth in the economy, and can be associated with unemployment and low consumer confidence. Several advisors and bystanders begin pitching their solutions to you as you fight the urge to drift off to sleep.

Option: Your top economist is in a frenzy. “This is really bad, @@LEADER@@,” @@HE@@ says. “We need to take drastic action to prevent unemployment, stagnation, or even... deflation.” @@HE@@ shudders before continuing, “Let’s go all out on monetary policy: it’s time for bond buybacks, decreasing the interest rate, and lowering banks’ reserve requirements. We’ll have those numbers up in no time!”
Outcome: the central bank takes extreme measures whenever the economy falls slightly short of projections

Option (validity: must have physical currency): “Uh, what are you even talking about?” asks one of your younger aides. “It sounds like you trust the banks and people with @@CURRENCY@@ out the wazoo to fix this, while everyone else is suffering. If there’s not enough inflation, why don’t you just print more money? That way, you can put more cash in the hands of ordinary people.”
Outcome: citizens carry around huge stacks of cash in case they feel getting a snack from the vending machine

Option (validity: must have computerized currency): “Uh, what are you even talking about?” asks one of your younger aides. “It sounds like you trust the banks and people with @@CURRENCY@@ out the wazoo to fix this, while everyone else is suffering. If there’s not enough inflation, why don’t you just put more money into the system? That way, ordinary people benefit instead of the mega-rich.”
Outcome: credit transfers have started to take an excessively long time

Option: @@RANDOMNAME@@, a noted economic libertarian, has barged in to contribute @@HIS@@ thoughts. “Typical of you government cronies to think the solution is more meddling in the economy. If anything, you should cut taxes and give us all a break. Sure, we might have to lose a little education or healthcare or policing, but at least your little underinflation problem will be solved.”
Outcome: crucial government programs are being cut to give Johnny Taxpayer a little extra spending money

Option: “I must be going nuts! One day they’re all on about the dangers of inflation, and the next they’re saying there’s not enough of it?” muses @@RANDOMNAME@@, a random pedestrian who seems to have stumbled into your office by accident. “I mean, what’s next, are they going to tell me too much exercise is a bad thing? @@LEADER@@, ignore these stuck-up elitists and listen to what real people think!”
Outcome: the government’s new economic policy is based on “the general vibe of things”

Title: Inflated Concerns

Validity: Very strong economy, not fully centrally planned, not fully laissez-faire

The issue: Your economic advisors have noted that the level of inflation in @@NAME@@ has, for the past few months, consistently fallen short of the central bank’s target. Several advisors and bystanders begin pitching their solutions to you as you fight the urge to drift off to sleep.

Option: Your top economist is in a frenzy. “This is really bad, @@LEADER@@,” @@HE@@ says. “We need to take drastic action to prevent unemployment, stagnation, or even... deflation.” @@HE@@ shudders before continuing, “Let’s go all out on monetary policy: it’s time for bond buybacks, decreasing the interest rate, and lowering banks’ reserve requirements. We’ll have those numbers up in no time!”
Outcome: the central bank takes extreme measures whenever the economy falls slightly short of projections

Option (validity: must have physical currency): “Uh, what are you even talking about?” asks one of your younger aides. “It sounds like you trust the banks and people with @@CURRENCY@@ out the wazoo to fix this, while everyone else is suffering. If there’s not enough inflation, why don’t you just print more money? That way, you can put more cash in the hands of ordinary people.”
Outcome: citizens carry around huge stacks of cash in case they feel getting a snack from the vending machine

Option (validity: must have computerized currency): “Uh, what are you even talking about?” asks one of your younger aides. “It sounds like you trust the banks and people with @@CURRENCY@@ out the wazoo to fix this, while everyone else is suffering. If there’s not enough inflation, why don’t you just put more money into the system? That way, ordinary people benefit instead of the mega-rich.”
Outcome: credit transfers have started to take an excessively long time

Option: @@RANDOMNAME@@, a noted economic libertarian, has barged in to contribute @@HIS@@ thoughts. “Typical of you government cronies to think the solution is more meddling in the economy. If anything, you should cut taxes and give us all a break. Sure, we might have to lose a little education or healthcare or policing, but at least your little underinflation problem will be solved.”
Outcome: crucial government programs are being cut to give Johnny Taxpayer a little extra spending money

Option: “I must be going nuts! One day they’re all on about the dangers of inflation, and the next they’re saying there’s not enough of it?” muses @@RANDOMNAME@@, a random pedestrian who seems to have stumbled into your office by accident. “I mean, what’s next, are they going to tell me too much exercise is a bad thing? @@LEADER@@, ignore these stuck-up elitists and listen to what real people think!”
Outcome: the government’s new economic policy is based on “the general vibe of things”

[Candensia]

The ordinary reader, I feel, is going to think inflation is a bad thing. They might not understand why low inflation can also be disadvantageous. Can you, maintaining the length of the intro, convey the situation in a way that explains why low inflation may negatively impact @@NAME@@? Just a quick phrase that shows what low inflation levels are doing.

[Sensorland]

The ordinary reader, I feel, is going to think inflation is a bad thing. They might not understand why low inflation can also be disadvantageous. Can you, maintaining the length of the intro, convey the situation in a way that explains why low inflation may negatively impact @@NAME@@? Just a quick phrase that shows what low inflation levels are doing.

I was hoping I did that in Option 1. It's tricky to get into why low inflation can be a bad thing, but I'll try to convey it a bit better in the intro.

[Trotterdam]

They monotonously explain to you that this is a sign of slowing growth in the economy, and can be associated with unemployment and low consumer confidence.

If low inflation is a "sign" of something, then it seems like artificially increasing inflation would be fixing the symptom rather than the disease.

[Sensorland]

They monotonously explain to you that this is a sign of slowing growth in the economy, and can be associated with unemployment and low consumer confidence.

If low inflation is a "sign" of something, then it seems like artificially increasing inflation would be fixing the symptom rather than the disease.

The goal of expansionary monetary policy isn't to artificially increase inflation. Increasing the money supply is meant to resolve the problems that also result in the low inflation level. The European Central Bank, for instance, has recently been performing bond repurchases in an effort to stimulate the economy and get the inflation level close to 2%.
https://money.usnews.com/investing/news/articles/2019-10-24/ecb-keeps-policy-unchanged-but-door-stays-open-to-more-stimulus

Edit: That said, I get your point. I'll try to clarify that the fix that's implemented isn't just a solution to undesirably low inflation, but also to the other associated economic problems.

[Sensorland]

I would still love to hear feedback on this, especially from experienced issues writers and editors.

[Australian rePublic]

Printing more money seems like the obvious solution here- why would anyone choose anything else?

[Sensorland]

Printing more money seems like the obvious solution here- why would anyone choose anything else?

Now that's interesting, because I consider that option to be one of less desirable ones! Economically speaking, the most realistic options are the first one (expansionary monetary policy) and the second-to-last one (expansionary fiscal policy).

[Trotterdam]

@@HE@@ notices the blank stares @@HE@@’s getting. "Er, we can solve our problems by putting more money in the economy."

This is the problem. "Putting more money in the economy" sounds like "printing more money" to the average layperson, and you're not really explaining how it's any different, just joking about how it'd be too difficult for us to understand.

Unless you can explain both the problem and the solutions in a way that's comprehensible to people without a background in economics, most players' response will be "yeah whatever".

(Tip: I'd suggest ordering your options to put the simplest solutions first, so that the more complicated options can then explain how they're different from the simpler options that they resemble.)

and the second-to-last one (expansionary fiscal policy).

Cutting taxes doesn't seem viable as a long-term solution. Sure, you can do it once or twice, but then what? If the economy starts failing again, you can't cut taxes again, because they're already near zero. Cutting taxes would only make sense if having low taxes would guarantee that this problem will never come up again. Printing more money (or whatever) is something you can repeat as often as necessary.

[Sensorland]

-snip-

Thanks for the feedback! I really appreciate it. I'll put some work in later to try and make this issue a lot more accessible to more people. Regarding putting the simplest solutions first: I really think the top economist would (and should) be the first to speak up in this situation, so I'm going to maintain that as the first option. I will rework it so it's more comprehensible, though.

[Sensorland]

I have significantly reworked option 1, and I've done some work on the other options as well. I hope this makes the issue more accessible.

[Sensorland]

Bumping this again - I really do think this idea has merit, which is why I want feedback so it can be made into a good issue

[Fontenais]

The issue: Several advisors and bystanders begin pitching their solutions to you as you fight the urge to drift off to sleep.

I think you can cut this sentence out of the description
The first part is a redundancy, because the fact that people are here to speak to Leader is always the case
The second part is a breach of player autonomy, because the writer is not allowed to say what Leader feels or does

[Merconitonitopia]

I don't like the option to cut taxes. A libertarian would sooner reject the notion that low inflation or deflation can cause macroeconomic problems, not recommend a libertarianish solution to a problem that he'd deny is really a problem at all. He'd also probably reject the notion of monetary policy instruments in general. That said, one could read it as a lousy excuse on his part to demand what he really wants, which is the tax cut for its own sake.

I would note that there is no option for fiscal policy, although you do refer to this aforementioned option as the fiscal option. This is no good. Whereas a tax cut is inflationary on its own, it also recommends reducing government expenditures, which would be deflationary. Assuming the cut in expenses is sufficient to offset the fiscal cost of the tax cut, this policy would be deflationary on net. A proper fiscal stimulus would involve increasing gov't spending, or at least, cutting taxes a fair bit more than expenses.
Then again, you can't really have fiscal stimulus in NS because there's no such thing as a deficit in NS. Any increase or decrease in taxes or expenses is presumed to be offset by an appropriate corollary change in the opposite direction. So I suppose there can't really be expansionary fiscal policy in one way or the other.

At any rate, I am disappointed by a deficiency in references to helicopters, given options 2/3.

[Trotterdam]

I don't like the option to cut taxes. A libertarian would sooner reject the notion that low inflation or deflation can cause macroeconomic problems, not recommend a libertarianish solution to a problem that he'd deny is really a problem at all. He'd also probably reject the notion of monetary policy instruments in general. That said, one could read it as a lousy excuse on his part to demand what he really wants, which is the tax cut for its own sake.

A libertarian may endorse a return to non-fiat currency, so it's not all controlled by the government.

I find it interesting how commodity currency (and its spin-off, representative currency) was the norm worldwide until less than a century ago, but then everyone switched to fiat currency and now no nation anywhere still uses the system that has served us well for most of human history. Economists aren't stupid, so there must be some kind of reason for that, but I never understood it. Surely this history should serve as evidence that both approaches are at least somewhat viable - so why such a unanimous support for either one depending only on what century you're in?

[Merconitonitopia]

The short answer is that monetary policy wasn't really a thing a century ago. Once everyone was persuaded that controlling the money was a good idea, it followed naturally that money shouldn't be tied to a commodity market that's more or less outside of the anyone's control. If you want to go against fiat money, you'll need to be going against all of today's macroeconomic theory that has been taking shape over the past century (see: Austrian school).

[Candlewhisper Archive]

Interestingly, commodity money can re-emerge in a modern context, but normally only when fiat money is impractical. The two situations for this are:

1) Confidence in currency has vanished, and yes, hyper-inflation can definitely do that. However, often what will happen is locals will instead turn to a different fiat currency which commands more confidence, such as the US dollar.
2) Within microeconomies where fiat money is rendered unavailable by external factors. For example, in prisons, cigarettes are used as currency.

On a global level, I'd say the best path to commodity money would be a collapse in confidence in all fiat money, which could happen with a sufficiently brutal global financial crash. While I'm generally pro-globalisation, I'd note that one of the best ways to head towards this doomsday scenario would be to create a single universal currency, as if confidence in that currency fails with no alternative fiat currency about, then we're into full societal panic mode. Rick and Morty actually nudges this idea, where he collapses an entire civilisation by screwing with the fiat value of the sole galactic currency.

Anyway, all that;s an aside. On the subject of the issue, I think its interesting, but the presentation isn't great, with everything presented in terms that are too broad, covering too much ground. Having an issue about inflation is like having an issue about police -- you're not meant to cover the whole topic in one sitting.

I'd suggest instead focusing the issue on one question, for example, "who should control interest rates?". That question relates to inflation, but doesn't attempt to simplify the whole of economics into a few lines.

[Fontenais]

I'd suggest instead focusing the issue on one question, for example, "who should control interest rates?". That question relates to inflation, but doesn't attempt to simplify the whole of economics into a few lines.

I don't know very much about economics, but there was a similar issue in Australia not that long ago:
The reserve bank of Australia (there is precedent for a 'Central Bank' in #717) recently cut interest rates to a historic low of 0.75% to lift inflation back into the 2-3% target
The banks feel like they're getting screwed over, and have either decided not to cut interest rates, or cut interest rates only very slightly
National Australia Bank "NAB" reported a full year profit of around $5 billion, 14% lower (lower than what, I don't know) and something about NAB had to pay about $1 billion dollars in remediation costs. (Probably from the royal commission into banking)
I don't know if you can turn that story into an issue, I would fall alseep if I tried

[Trotterdam]

cut interest rates to a historic low of 0.75% to lift inflation back into the 2-3% target

...Huh? How does that even work?

Doesn't interest put more money into the economy, even if it's just digital money on your bank account rather than physical cash? Wouldn't that increase inflation?

[Fontenais]

cut interest rates to a historic low of 0.75% to lift inflation back into the 2-3% target

...Huh? How does that even work?

Doesn't interest put more money into the economy, even if it's just digital money on your bank account rather than physical cash? Wouldn't that increase inflation?

I think it refers to mortgage interest rates, rather than savings interest rates, because my savings interest rate is less than 0.75%
Edit: Apparently it is the 'cash rate' which is supposed to be a benchmark rate for mortgages

[Trotterdam]

I think it refers to mortgage interest rates, rather than savings interest rates

Oh, right. That makes sense.

[Merconitonitopia]

cut interest rates to a historic low of 0.75% to lift inflation back into the 2-3% target

...Huh? How does that even work?

Doesn't interest put more money into the economy, even if it's just digital money on your bank account rather than physical cash? Wouldn't that increase inflation?

Lower interest rates means more borrowing, means more spending, means demand-pull inflation.

[Sensorland]

For the record, I am still working on this. I have been busy both RL- and and NS-wise, so this has fallen by the wayside a little, but I will get back to it and I appreciate the feedback that's been given.