Wage/price inflation

Back in the 50's, the government used fiscal (tax) policy to grow the economy. One method involved giving tax breaks to business, which in turn would use the money to expand by building new facilities and opening up new jobs. The second was to give tax breaks to the workers, who in turn would buy more causing businesses to produce more by building new plants. Both of these methods lost their effectiveness because business discovered it was more efficient to buy existing plants (mergers and acquisitions) rather than building new ones and the tax laws changed so most low and middle income workers no longer paid tax. In the mortgage crisis of 2008 the government sent out $900 billion to stimulate the economy but the myriad of new regulations made shovel ready jobs disappear and no one knows where the money went. In today's crisis, money is sent directly to the workers but not to expand the economy but just to keep it afloat. The plan now is to bring back manufacturing jobs at least to the point where supply chains can be maintained within the United States. This will lead to wages and prices going up with the goal to keep wage increases slightly above cost of living increases as was the case in the 50"s.