Elon Musk Says 'Inflation Is The Most Regressive Tax Of All, Yet Is Advocated By Those Who Claim To Be Progressive'

Inflation might be slightly easing, but it’s been a major topic of concern for the last couple of years, with some of the world’s most influential figures weighing in. Even Elon Musk, the CEO of Tesla and SpaceX, said that "inflation is the most regressive tax of all," criticizing those who support it while claiming to be progressive.

Progressives usually help lower-income people, but inflation hurts these people the most. As prices rise, it’s harder for low-income families to afford basics like food and rent. 

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Meanwhile, the rich can protect their money by investing in things that grow in value. This means that inflation increases the gap between the rich and poor, going against the goals of those who are, or claim to be, progressive.

After jokingly saying, "Due to inflation, 420 has gone up by 69," Musk responded to eye-opening statistics from the Blockworks X account about how much value $100 lost in 70 years. According to data that’s widely available, the purchasing power of $100 has dramatically declined over the decades:

• 1950: $100
• 1960: $80.41
• 1970: $61.34
• 1980: $28.88
• 1990: $18.21
• 2000: $13.82
• 2010: $10.91
• 2021: $8.70

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They added that in 70 years, $100 has lost 91.3% of its value. However, three years later, the reality is even worse because, according to In2013dollars.com, the U.S. dollar has lost 92% of its value since 1950 and $100 in 1950 is worth $1,303.63 today. 

But Musk wasn’t the only high-profile billionaire to disparage inflation. Amazon founder Jeff Bezos also joined the conversation. He had a bit of a spat with President Joe Biden on Twitter about who is responsible for the high inflation rates. Bezos pointed out that inflation hits lower-income households the hardest. 

He said, "The administration tried hard to inject even more stimulus into an already overheated, inflationary economy and only Manchin saved them from themselves. Inflation is a regressive tax that hurts the least affluent. Misdirection doesn't help the country."

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However, inflation is starting to slow down in 2024 due to several positive developments. The annual inflation rate recently dropped to 3.0% in June, which is a significant improvement compared to earlier in the year.

One big reason for this is the recovery of the global supply chain. During the pandemic, supply chains were heavily disrupted, making goods more expensive. As these supply chains return to normal, prices stabilize.

Another factor helping to bring down inflation is the drop in energy prices, especially fuel costs, which helped reduce overall transportation costs. This has a ripple effect on other goods and services​.

Housing costs, which had been rising sharply, are also starting to stabilize, and rent growth has slowed down considerably, helping to ease one of the biggest contributors to inflation​.

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