I think you're discounting how connected everything is.
When you buy XYZ stock the company is able to borrow more and at better rates. They are able to attract buyouts, pay higher salaries, hire more employees and generally spend more in a number of ways.
When individuals like Jeff Bezos add another zero to their net worth they are able to borrow against their own stock holdings as well as are more likely to splurge on other things (like his new yacht) such as funding Blue Origin and Project Kuiper so Musk doesn't pass him as the richest man in the world.
All this results in more money spent and entering the economy ultimately trickling down to purchases of milk, bread and starter homes while making many other stops along the way.
Again, I 100% agree on the connectedness of the economy and trickle down effect.
If I understand you correctly, I think where we disagree is the effect of Taxation. If the government tax the wealthy and incinerated it, then yes, I agree that would reduce job growth, wage competition, and inflation. However, if taxes are increased and the money is distributed directly to the workers, I would expect this to increase inflation.
Do you think job creation from capital reinvestment is a stronger driver of inflation then putting that money in consumer pockets?
The only ways to reduce inflation is to increase product Supply or reduce demand. I don't think that taxing the wealthy will increase Supply and I do think that giving workers more monetary transfers or a lower tax burden increases demand.
You simply can't reduce inflation and while increasing consumer purchasing power while holding supply constant.
I too agree with your comment, I must be missing more context.
> if taxes are increased and the money is distributed directly to the workers
This is unlikely, taxes and laws are always overseen by lobbyists who are funded by the wealthy. I can't imagine a situation where they would vote themselves into a worse situation.
If they ever appear to, know the harm they face would be to their advantage (such as crushing startup competition or preventing litigation).
Perhaps this seems like an overly jaded take, but please reference this Princeton study that found the wishes of the US population have had no real effect on laws for decades.
I'm not sure I agree with that cynical of a take, but even if is true, I don't see how moving money from one wealthy person to another would be an effective tool to fight inflation.
Furthermore, I don't think that is the underlying assumption held by people who say we should tax the rich to fight inflation.
When you buy XYZ stock the company is able to borrow more and at better rates. They are able to attract buyouts, pay higher salaries, hire more employees and generally spend more in a number of ways.
When individuals like Jeff Bezos add another zero to their net worth they are able to borrow against their own stock holdings as well as are more likely to splurge on other things (like his new yacht) such as funding Blue Origin and Project Kuiper so Musk doesn't pass him as the richest man in the world.
All this results in more money spent and entering the economy ultimately trickling down to purchases of milk, bread and starter homes while making many other stops along the way.