Seigniorage is not exactly a modern discovery, and when you fund government activity this way to an excessive degree inflation essentially becomes taxation without representation (and it disproportionately hurts those on fixed-incomes such as seniors). High inflation distorts price signals, which leads to inefficiency. The stagflation of the late 1970s is a good example of the end result.
Maybe the implicit inflation target should be raised to 3-4%. Perhaps the benefits would outweigh the costs at that target. It is difficult to imagine that being the case at a target beyond four, maybe five percent...
I’ll assume your talking about printed currency; don’t be so fast to blow on by the trade, as in “in-kind”, what it represents. It is a balanced art being a good S.O.B., it’s primary function is to dissolve the rate of inflation, known as laziness, apathy, the entitled sovereigns’. Just imagine a good S.O.B. with velocity; kind of like good cholesterol vs. bad cholesterol, they’re both going to exist and required - the right mix is all that is needed.
