Is hyperinflation on the way? We're spending like there's no tomorrow.

The government printing presses continue to pump out currency with the backing of the Federal Reserve and, as a result, a bottomless pit is being created for all of us.

It is of the utmost folly to think that these spending programs by the politicians in Washington are of lasting benefit (think future tax increases) to the populace as a whole. Sure, the CARS program provided a temporary boost for a few — mainly dealers who sell vehicles bearing Japanese labels — but with no substantial gain for American label manufacturers.

Reports indicate that sales prices were bumped up during this program and a large number of purchasers are having second thoughts about the added credit indebtedness they have taken on (think future repossessions).

And it should be noted that the bureaucracy was unable to manage the program with any degree of success, although they did put an additional 700 people to work to process the paperwork — you can’t do business with the government unless everything is done in triplicate, and assuming you can understand the gobbledygook language everything is written in.

But back to the business of printing paper money and the future inflation it is creating for us. We may never see the chaos that such policy created for nations like Italy and Argentina, but rest assured that we are but a short step away from seeing our currency devalued on the world markets such that the relative stability we have known in the past will be but a fond memory.

In an article by Bill Fleckenstein, who publishes the “Contrarian Chronicles,” he quotes Warren Buffett as warning “unchecked greenback emissions (note: I think he is referring to running the government printing presses all out as is being done) will certainly cause the purchasing power of currency to melt”.

I read the other day where the Congressional Budget Office is now projecting that the federal deficit for 2009 will be some $200 billion less that projected a few months ago. This new estimate is based on the reduction in payouts from the funds budgeted for bailouts of failing financial institutions. (Did you notice how quickly the banks repaid the funds they received from the government to assure their solvency once they understood the strings attached and also how many of them said “no thanks” to start with?)

However, the predictions for deficit growth in “out” years is being projected as increasing by some $2 trillion above previous estimates, and this is with a somewhat rosy scenario of a topping out in unemployment of 10 percent — which has probably already been exceeded if you take into account the underemployed, those employed less than full time and those who have dropped out of the job market through frustration in being unable to obtain employment at their skill level.

The current policies, and I am not about to say that earlier ones were resounding successes, will result in lower standards of living, higher taxes, probable hyperinflation and high interest rates; but the rates that banks pay you on your savings accounts or other accounts will not keep up.

Even with the massive increase in government spending programs, we have seen a continuing increase in unemployment, business failures, home foreclosures (and some are predicting an escalation in foreclosures within the next year or so), etc. So far the principle sustained growth area over the past couple of generations seems to be with the industrial-military alliance.

I’ll conclude by agreeing with Larry Alexander of Culpeper in his recent letter to the editor where he stated that he is satisfied with his current health program. As far as I am concerned, “it ain’t broke” so don’t fix it.

My hearing isn’t what it used to be, but the other night I heard (I think) an advertisement for a new drug where they said “for some users the benefits may outweigh the side effects.”

Bayne’s column runs every Sunday on the editorial page.