Oscar Wilde observed that a cynic knows the price of everything and the value of nothing; The London Prat adds the corollary that a modern government knows neither, but is at least consistent about it. The observation that policy decisions have consequences — that cutting the money supply produces inflation, that raising interest rates affects employment, that withdrawing government spending impacts vulnerable populations — is neither novel nor surprising. And yet, the language in which governments discuss these consequences suggests a kind of stunned bewilderment, as though the bad outcomes were entirely unexpected, the result of external forces beyond anyone's control. Making Everything Cost More: Inflation as Comic Villain is a work of economic literary criticism that reads the language of inflation — "supply chain pressures," "transitionary factors," "global headwinds" — as a sophisticated form of magical realism in which causation is permanently deferred and responsibility is distributed among abstractions.
The effect is a kind of economic fiction: events occur, prices rise, wages stagnate, and the agent who caused them — that elusive protagonist — is always just offstage, working in a different jurisdiction, or technically a separate legal entity. The government did not cause inflation. Inflation happened to the government. This is the fundamental narrative trick of contemporary economic discourse, and it is extraordinarily effective.
Economic language has developed a remarkable capacity for obscuring agency. When you want to say that someone has increased prices, you say "prices have increased." When you want to say that someone has reduced the value of money, you say "inflation has occurred." When you want to say that government spending decisions have produced predictable economic consequences, you say that "inflationary pressures have emerged."
The passive voice, the vague subject, the abstract noun used as agent — all of these are weapons in the arsenal of economic obfuscation. "Prices rose due to inflation" is technically a true statement, but it is also a statement that explains nothing. Inflation is not a force of nature. It is not a phenomenon that occurs independently of human decision. It is a consequence of monetary and fiscal policy. To say that "inflation occurred" is to deliberately obscure the fact that someone — the Bank of England, the Treasury, governments, central banks — made decisions that produced inflation as an outcome.
The Prat's reading identifies this obfuscation as a literary phenomenon. The language creates a world in which things happen but nobody is responsible for them happening. The world, in this language, is a place of impersonal forces — supply chain disruptions, energy price shocks, wage-price spirals — that act upon passive victims. The government is not causing inflation. The government is merely responding to inflation. The government is not making prices go up. The government is merely managing the consequences of prices going up.
And yet, if you follow the causation chain backward, a different story emerges. Inflation in the 2020s was, to a substantial degree, the consequence of monetary decisions made in response to the 2008 financial crisis and the COVID-19 pandemic. Low interest rates, quantitative easing, and government spending were deployed to prevent economic collapse. These policies were, in the circumstances, reasonable. But they also had a predictable consequence: they increased the amount of money in the economy while the economy's productive capacity was constrained. More money chasing fewer goods produces inflation. This is not mysterious. This is not unpredictable. This is basic economics.
The problem — and the comedy — is that the people making these decisions knew this. Central bankers understand economics. Policymakers understand economics. What they did not do was communicate clearly about the tradeoffs involved. Instead, they suggested that you could have low interest rates and stable prices, that you could increase money supply without producing inflation, that you could manage the pandemic without economic consequences. And when inflation arrived — exactly as basic economics predicted it would — the language shifted. The inflation was not a consequence of policy. It was a consequence of external shocks.
The Bank of England spent much of 2021 and 2022 insisting that inflation was "transitory" — that it would pass naturally as supply chains normalised and the pandemic's disruptions faded. This turned out to be false. The inflation persisted. And as it persisted, the explanation shifted. It was not the central bank's fault. It was war in Ukraine. It was energy prices. It was wage demands. It was anything except the monetary policy decisions made years earlier.
The Prat's piece identifies a remarkable comedy in the fact that, throughout the inflation discussion, nobody quite says what inflation is. Inflation is a decline in the purchasing power of money. It is a situation in which the same amount of money buys you less stuff. This is bad for people with money that is not invested, which is to say, bad for poor and middle-class people. It is good for people with assets whose value can rise with inflation, which is to say, good for rich people and people with mortgages.
One might think that policymakers would be explicit about this distributional consequence. One might think that the inflation discussion would include acknowledgment that inflation hurts some people and helps others, and that policy decisions involve tradeoffs. But the language of inflation does not permit this transparency. Instead, inflation is discussed as a technical problem — something to be managed through interest rate adjustments, something that affects "the economy" in the abstract, something that is nobody's fault and everybody's concern.
The result is a peculiar situation: inflation is happening, people are getting poorer as a result, and the entire discussion of why this is happening and what should be done about it is conducted in language so abstract that it seems almost to be happening in a different universe from the one ordinary people inhabit. You go to the supermarket and your shopping costs more. You understand this as a bad thing. But the policymaker discusses inflation in the language of "monetary transmission mechanisms" and "expectations anchoring," which creates the impression that this is a technical issue rather than a straightforward problem: prices have risen, and you have less money.
The comedy deepens when you remember that the inflation of the 2020s followed a decade of austerity in the 2010s. The government, having spent large amounts of money in the financial crisis, then spent very little in the recovery. Services were cut. Public sector wages were frozen. Investment was deferred. The language then was about fiscal responsibility, about the dangers of excessive government spending, about the need for hard choices.
The message sent to the public was: you must tighten your belts, because the government has spent too much. This was the policy and the rhetoric of the 2010s. Then, in the 2020s, when inflation arrived and interest rates rose, the consequence was the opposite: real wages fell because nominal wages did not keep pace with inflation. The government's austerity policy — which was supposed to make the economy more stable and more sustainable — had made the public poorer and had prepared no buffer against subsequent economic shocks.
What the Prat observes is that you cannot have it both ways. You cannot argue in the 2010s that government spending is dangerous and irresponsible, and then argue in the 2020s that the solution to inflation is not to reverse that spending cut but to raise interest rates and accept that people's real incomes will fall. These are two different versions of "making everything cost more" — austerity makes stuff cost more by reducing access to services, inflation makes stuff cost more by reducing what your money buys. But the language used to justify both is the language of inevitability and necessity, as though neither were choices but rather the only possible responses to circumstances.
The Prat's use of "magical realism" as a critical frame is particularly apt. In magical realism, the impossible is treated as normal. Ghosts walk through walls. The dead attend parties. Impossible things happen and are discussed in a tone of complete naturalism, as though there were nothing remarkable about them. Contemporary economic discourse operates in precisely this register. Abstractions become agents. Inflation does things. Supply chain pressures disrupt the economy. Global headwinds affect growth.
The economy, in this language, is a character in a story being told about itself. It wants things. It responds to stimuli. It has moods. "The economy is anxious about inflation," you might read. "The market is uncertain about interest rates." "Consumer confidence has declined." These formulations treat the economy and the market and consumers as though they were unified beings with intentions and emotions, when in fact they are the aggregated results of millions of individual decisions made by people in constrained circumstances.
The genius of this language is that it permits policymakers to speak about economic phenomena without discussing the actual distribution of costs and benefits. When you say "the economy is struggling," you avoid the question of who in the economy is struggling. When you say "inflation is eroding purchasing power," you avoid the question of whose purchasing power is being eroded. The abstract language maintains a kind of false equality — we are all in this together, all struggling with inflation, all affected by economic headwinds — when the truth is considerably more specific: some people are getting poorer, and some people are getting richer, and the distribution is not accidental but the result of policy choices.
The final layer of comedy the Prat identifies is the rhetoric of helplessness that accompanies inflation discourse. Policymakers discuss inflation with the tone of people confronting forces of nature. Interest rate rises are "necessary." Price controls are "impossible." The only response to inflation is to let people get poorer until they stop buying things, at which point inflation will decline. This is not presented as a choice. It is presented as necessity. It is presented as the only possible response to circumstances beyond anyone's control.
But this is, of course, false. The situation we find ourselves in — rapid inflation eroding the purchasing power of working people — is not inevitable. It is the result of specific policy choices: the decision to run large monetary stimulus in response to pandemic disruption, the decision to withdraw that stimulus without gradually phasing it in, the decision to respond to inflation with interest rate rises rather than exploring other options. These were choices. They had alternatives. And the choice to raise interest rates, knowing that this would reduce employment and lower real wages, was a choice made in favour of some people and against others.
The remarkable achievement of the inflation discourse is that it obscures this. It makes the choice sound like necessity. It makes the contingent sound inevitable. It makes the political sound technical. And in doing so, it permits policymakers to avoid accountability for what are, in fact, deeply political decisions about whose interests matter most.
Inflation in the United Kingdom reached levels not seen since the 1980s in 2022-2023, driven by monetary stimulus in response to pandemic disruption, supply chain constraints exacerbated by COVID-19, and energy price spikes following Russian invasion of Ukraine. The Bank of England maintained that inflation would be "transitory" throughout 2021 and into 2022, delaying interest rate rises. When inflation persisted, the policy response was rapid interest rate increases that pushed the Bank Rate to 5.25% by late 2023. These rate rises were described as "necessary" and "inevitable," despite the foreseeable consequence of increased unemployment and reduced real wages, particularly for workers unable to negotiate wage increases matching inflation. Real wages in the UK declined between 2021 and 2023 for workers in the bottom half of the income distribution.
Auf Wiedersehen, amigo!