You don't understand. The profit isn't the 2% inflation a year.
The real profit is a stable productive growing economy. A slight amount of inflation facilitates that.
Second, you seem to be under the impression that the government is just printing up and walking away with the 2% each year. It doesn't work like that. Money is created through banks creating loans. The Fed influences the rate of that money creation.
If credit expands faster than the supply of goods, then we get inflation. If credit expands slower than the supply of goods, we get deflation. It's not the government that usually benefits from the 2%, it's the borrowers, because the dollars they pay back with have a lower purchasing value.
To the extent that government is a large borrower, they do benefit, but it's indirect, and certainly not the entire 2%. Government benefits far more from a good economy, than from the inflation effects. So do banks. So do we the people.
“You don’t understand. The profit isn’t the 2% inflation a year.
The real profit is a stable productive growing economy. A slight amount of inflation facilitates that. “
We also have a far higher inflation rate than 2%. They take energy and food prices out of the inflation calculation for a reason. But anyone who shops for groceries knows the truth. (same with healthcare and education, although they have their own set of issues/lack of competition).
If credit expands too fast, i.e. money gets to cheap then people borrow to much money and mal-invest it. I.e. the money gets destroyed. Housing bubble... The root cause of our current economic troubles.
A more honest money system would be based on a basket of commodities. If the government needs to expand the money supply they would have lots of options to do so.
Won’t happen in my lifetime. The system is setup the way the banks and government want it set up.