Not too long ago, the loudest critics of today’s reality stood firmly against what they called poor economic conditions of Liberians , citing, reckless monetary supply, inflation and decline of purchasing power as the silent erosion of household wealth.
By Malcolm W. Scott- malcolmscott.npa@gmail.com | contributing writer
Yet, in a striking turn of events, the very former opposition criticis, now champions of the same measures they once condemned, are poised to print new bank notes and raising taxes as quick fixes to Liberia’s current economic shocks.
What a cautionary tale- when unchecked printing of money, a core concern in Monetary Economics that leads to inflationary pressures that hurt the most vulnerable, it’s a catch of either more money chasing the same amount of goods, while price hiking, wage lag, and savings lose values.
How come the the critics of yesterday have become proponents of today? What went wrong with their questions about consistency, credibility, long-term vision and economic stewardship requires more than reactive measures?
Have they fallen asleep on demands of discipline, innovation, and policies that encourage production, investment, and resilience rather than defaulting to printing money and increasing taxes?
Are these the ” wildly talked about best rescue policies for structural reforms, government efficiency, reducing waste, and fostering private sector growth. ?
What an Illusion of Growth- Taxing for Expansion and Printing Money for Recurrent Spending Can Backfire!
Economic growth is not merely a simple equation to raise more taxes to fund development, and print more money to keep the government running if revenue falls short.
While these approaches may appear practical in the short term, they carry significant long-term risks that can undermine the very growth they intend to achieve.
Taxation in the name of growth can weaken the productive base of an economy.
A good option will help if businesses, especially small and medium enterprises, rely on predictable and manageable tax environments to expand, invest, and create jobs.
When taxes become too high or are unpredictably increased, entrepreneurs are discouraged from taking risks.
So, Instead of fueling growth through heavy taxation to shrink economic activity, reduce investment, and further drive businesses into the informal sector the, printing of new money to finance recurrent government costs—such as salaries, administrative expenses, subsidies and support 2029 political campaign—poses serious threat to economic stability.
Unlike capital investments that crates generate future returns, recurrent expenditures do not directly create wealth.
To move to Injecting newly printed money into the economy without corresponding increases in goods and services lead will lead to horrible inflation.
Already, in the face of rising princes, the purchasing power of citizens are declining more by the day- hitting the poorest at all levels.
If the critics of today feel compelled to print more money to meet rising costs, the consequences will hit high.
The country and its people should embrace themselves for currency depreciation, higher cost of imports, and general decline in living standards.
Sustainable economic growth requires a different approach.
Government should focus on expanding the tax base rather than increasing tax rates—encouraging compliance, supporting business growth, and formalizing the informal sector.
Public spending must be prioritized for productive investments such as infrastructure, education, and healthcare- which, will generate long-term economic returns.
Fiscal discipline and sound monetary policy are essential pillars of a healthy economy.
Growth cannot be forced through taxation pressure or artificial money supply.
Instead, it must be cultivated through policies that promote productivity, innovation, and confidence in the economic system
True growth is not printed or imposed—it is built.
