I recently received an e-mail from T.F. in Utah, who quipped: “They tell us that inflation is now non-existent. Well, how many years of deflation will it take to get prices back to where they once were? It is noteworthy that the average annual property tax on a house on a city lot now exceeds the entire land purchase price and construction cost of a comparable square footage house, in 1890.” Inflation is indeed insidious. And its has implications that are far-reaching. For example, consider the following:
Creeping tax increases one of the reasons that it is now nearly impossible for someone to “live off the land” on small acreage. Even if you own your house and land free and clear, property taxes are inescapable. Thus, in “self-sufficient” mode, although you can feed yourself, you still need a cash-earning job, just to pay the taxes. I pray that at the far end of the coming depression, our debt money system–which is the root of inflation–will be replaced by a system of sound currency that is redeemable in specie. That is the only sure, long term solution to creeping inflation, and corresponding creeping taxation.
I’ve mentioned this tale of woe before: Back in the 1930s, my great grandparents lost a considerable portion of their 5,000+ acre sheep ranch in northern California to back taxes. At the beginning of the Great Depression they were land rich but cash poor. But by the end of the Depression, that had neither much money or land. (By 1942, the county had taken most of the ranch for back taxes.) Although the chances of a long-lasting deflationary depression are fairly small (since I think Helicopter Ben will try to inflate his way out of this mess), it is prudent to do your best to maintain a cash income to supplement “the fat of the land”, from your self-sufficient retreat. See the SurvivalBlog Archives for some suggestions on building up home-based businesses.