[jfaucett]

> If everyone is rich, prices just rise to the point where everyone isn't rich anymore.

Rich and poor are always tied to purchasing power which itself is tied to productivity, efficiency and innovation within an economy. (as well as the traditional price theory, demand/supply, etc.) I used rich/poor because those are simple terms everyone can understand more easily than PPP or Genuine Savings, etc. (however, wealth is a better term I should have probably used in its stead)

For instance, the phone you can buy and hold in your hand today for $200 is vastly more powerful than the most expensive IBM mainframes of just 20 years ago - A CEO of those times could not even afford the simple phone many refuges have in their Rucksacks these days. Are they rich because of this? It depends on what particular measurement for "rich" you are using.

To answer your question. Yes, ceteris peribus if everyone gets more money instantly (i.e. money supply increases) all prices will rise accordingly and there is a net null effect, however, and this is key, if that increase is in wealth i.e. capital assets, productivity, everyone is better off and prices will increase according to traditional demand-pull.

[mdorazio]

Great, wealth is a much better term to be using here, but you're still hand-waving away the method by which increasing capital assets, productivity, etc. would happen under a capitalist free market. The traditional way you increase these things for everyone is by collective bargaining (unions) or collective ownership of businesses (employee-owned companies). These two things are pretty much directly at odds with American-style capitalism.

Do you think we should be aiming for something more akin to the labor situation in Europe, or do you think there's a different method by which we could create wealth for everyone more equally than today?