Rajan suggests that a central bank's reluctance to aggressively fight inflation may stem from a fear of being blamed for a potential recession. In a politically charged environment, the institutional risk of becoming the 'fall guy' can subtly influence policy, leading to a more dovish stance than economic data alone would suggest.

Faced with mass job loss from AI, governments are unlikely to seize assets from the wealthy. The politically easier path is to print massive amounts of money for social support, preserving the existing capital structure while devaluing the currency.

Governments with massive debt cannot afford to keep interest rates high, as refinancing becomes prohibitively expensive. This forces central banks to lower rates and print money, even when it fuels asset bubbles. The only exits are an unprecedented productivity boom (like from AI) or a devastating economic collapse.

Money printing is a politically expedient way to provide voters with the illusion of "free" services. It allows governments to spend without immediate, visible taxation, playing directly into the human tendency to prioritize short-term ease over long-term consequences.

In a democracy with massive debt, reckless government spending becomes inevitable. The electorate will consistently vote for short-term relief (money printing, free programs) over the long-term pain of austerity, making fiscal irresponsibility a predictable outcome of human nature.

Politicians choose rate cuts because balancing the budget is politically unpopular and would trigger an immediate economic crisis. By lowering rates, they can "kick the can down the road," making massive government debt refinancing manageable. This intentionally fuels an "everything bubble" in assets as a preferable alternative to politically unpalatable fiscal responsibility.

Government money printing disproportionately benefits asset owners, creating massive wealth inequality. The resulting economic insecurity fuels populism, where voters demand more spending and tax cuts, accelerating the nation's journey towards bankruptcy in a feedback loop.

Since WWII, governments have consistently chosen to print money to bail out over-leveraged actors rather than raise taxes or allow failure. This long-term policy has systematically devalued currency and concentrated wealth, creating today's deep economic divide.

The original definition of inflation is an expansion of the money supply. By shifting the definition to mean rising prices (a consequence), governments can deflect blame for inflation onto businesses, unions, or foreign events, rather than their own money-printing policies.