More free money from Gavin Newsom!!!!!

Sausalito CA

Description

Recently California Governor Gavin Newsom said he wants to give up to $1,050 to about 23 million Californians in the form of an “inflation relief check.” He said these payments will have income limits so the lower income earners will receive the most. Is this a good idea? Newsom’s plan to give more free money to consumers in the form of relief checks will increase aggregate demand and worsen inflation. While it is true that the demand reduction actions mean that the lowest income earners and those on fixed incomes will be hurt the most, giving away free money will increase demand and worsen inflation.