LIKE leaving your lover, there are probably at least 50 ways to drive down living standards and make people worse off.

The unfortunate thing for most of us, who bear the brunt of it, is that governments – unless they’re terribly fortunate with the circumstances that coincide with their time in office – find they sneak up on you. And when they do, the measures that seem necessary to make matters better often turn out to be the ones that make matters worse.

The most insidious and most reliable of these is inflation. Most of us were taught this at school, with the example of the Weimar Republic in the early 1920s, when people had to cart around wheelbarrows full of banknotes to buy bread, and the exchange rate was 4,210,500,000,000 marks to the US dollar.

Yet the notion that you can cheat your way out of it is the bad idea that never goes away: it happened again in Hungary in 1946, when prices were doubling every 15 hours, and quite recently in Zimbabwe (which had to issue 100 trillion dollar bills, and where the rate went up to 79,600,000,000 per cent in 2008), and Venezuela. One site attempting to estimate interest rates there (which went from 440 per cent to around 65, 374 per cent in a few months in 2017-18) laconically claimed it could only estimate, because “Venezuela’s economy is collapsing”.

READ MORE: Burntcoat by Sarah Hall reviewed by Malcolm Forbes: 'erotic, tragic and elegiac'

Almost two decades before he produced his General Theory on the topic, the economist John Maynard Keynes observed: “Lenin was right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency.”

Perhaps that explains its continual appeal to the extreme left, who have demonstrated that bankruptcy almost always follows in every country where they’ve ever achieved power, and keep coming up with new variants – such as MMT (Modern Monetary Theory or, more accurately, Magical Money Tree) – on the theme.

It is, of course, possible to use other routes into recession: John Major managed it with huge interest rates in his ham-fisted attempts to stay in the ERM; Gordon Brown by actively encouraging housing and consumer credit bubbles and failing to regulate financial services growth.

But inflation’s the hardy perennial. Few people under the age of 60 will now have any memory of quite how serious its effects can be; the industrial disputes, energy crises, food shortages and general decay of the UK in the 1970s were the result of, and in turn, drivers of, inflation. Our current circumstances, even if nowhere near that point yet, have worrying indications of a dangerous direction of travel.

The (nominally Conservative) government seems to be making a virtue of wage increases, for example. They are not automatically a bad thing: the lowest-paid workers have been short-changed, both by government welfare credit that actually subsidises corporate employers more than their staff, and immigration which, while it has minimal effect on wages overall, does in the worst-paid jobs. There are other, related, issues: those distortions meant we didn’t train enough people, companies didn’t automate when staff were cheap, and so on. But the main factors are that unemployment is low, and so are borrowing costs.

READ MORE: "Like a sexy knitting bee" The midlife women bringing the world real sex stories

The fundamental definition of inflation is a fall in money’s value thanks to a persistent expansion in its quantity, because monetary demand exceeds the goods and services available. In theory, that expansion should raise employment until it’s absorbed, but once it does, if output doesn’t rise, prices do.

When they do, by enough and for long enough, people’s incomes can’t keep up with the cost of living. So they demand higher wages, they don’t save (because inflation will reduce its real value); anticipating price rises, they’ll buy in advance, if they can – even, if they have access to it, with borrowed money, because what they’ll be paying back will be worth less than what they’re getting now.

This is all very basic stuff, and lots of economists argue that some inflation is inevitable, and even desirable. Where, historically, governments have found it hard to get it right is knowing the exact point at which the brakes really need to be put on.

For a decade, the Bank of England has been tackling inflation with one tool: quantitative easing (QE), the very definition of persistent expansion in quantity. That now amounts to £895 billion, or 40 per cent of GDP.

All well and good, say most experts, as long as the inflationary threat is short-term. Given the disruptions of Covid and its global impact on manufacturing, availability of labour, productivity, supply chains and every other area of the economy you care to name, perhaps it’s a reasonable, indeed inevitable, measure.

But it was a reasonable and inevitable measure initially to deal with the banking crisis of 2008. It will soon be a reasonable measure to produce infrastructure essential for “levelling up”, for protecting the NHS, for sorting living standards for working families, for implementing vital climate change measures. There will never be a shortage of an emergency.

At the beginning of the 1970s, the UK thought it necessary to expand the money supply from about 10 per cent (in 1971) to 30 per cent by 1973. By the following year, the lights were going off, the three-day week loomed, and there was no sugar in the shops. By 1979, everyone (it seemed) was on strike, or rioting, the bin bags were piled high in the streets, and the dead were being left unburied.

That was a tipping point that tipped pretty quickly. The current government may well be right to say that it had to borrow, and that it was affordable to do so; it may also be right that some spending, even of borrowed money, may give parts of the country the boost they need to recover. But it would be wise to resist any spending that looks like a short-term fix.

Keeping a lid on energy and fuel prices – which most people cannot avoid – is prudent. So, even if logistics, retail or agricultural workers deserve to be “levelled up”, is resisting wage rises for others (doctors, teachers, train drivers or civil servants) who are already fairly well-paid. We shouldn’t even be considering fancy new bridges, royal yachts or other vanity spending. Inflation may not look like an immediate danger right now, but by the time it does, it will be too late.

Our columns are a platform for writers to express their opinions. They do not necessarily represent the views of The Herald.