INFLATION+DA

Inflation reasonable but higher than Bernanke wants, a moderate increase will spark a rate hike.

Dean Baker, co-director of the Center for Economic and Policy Research, 7/18/07, "Housing Continues to Hold Down Core Inflation in June," http://www.cepr.net/index.php?option=com_content&task=view&id=1245&Itemid=220

On net the price picture continues to be very mixed. There is certainly no story of inflation getting out of control; on the other hand, it does not seem likely that the core CPI will fall to the 2.0 percent target that Bernanke prefers. With somewhat rapid price increases at earlier stages of production (import prices have also been rising more rapidly), and a sharp slowdown in productivity growth in recent years, it seems more likely that inflation will edge higher than lower. The Fed will have to balance the desire for a lower inflation rate with ongoing weakness in the economy, as a sagging housing market and declining real wages continue to crimp demand growth.

Health worker shortage leads to inflation

Christopher Snowbeck, Februrary 26th, 2006. "Highmark chief says problems with part D offer lessons for government"

One of the key drivers of rising costs, he suggested, is the shortage of health-care professionals in some fields. A case in point was the divorce this month between a group of anesthesiologists and the West Penn Allegheny Health System. The break-up resulted in increased payments to professionals throughout the region as doctors moved and hospitals scrambled to make sure they had anesthesia services. "Now, the cost of anesthesia services in the community is higher than it was six months ago, and it doesn't make sense," Dr. Melani said. "We having nothing new -- we have no new capabilities, it's not going to allow us to live longer, healthier lives -- and we're paying more money."

Medical cost rising at brink rates now—a jump would cause skyrocketing inflation.

Dean Baker, co-director of the Center for Economic and Policy Research, 2/21/07, "Jump in Medical Costs Pushes Core Inflation Higher," http://www.cepr.net/index.php?option=com_content&task=view&id=1054&Itemid=220

An extraordinary 0.8 percent jump in medical care costs led to a higher than expected 0.3 percent core inflation rate in January. The overall inflation rate for January was 0.2 percent, as a 1.5 percent fall in energy prices more than offset a 0.7 percent increase in food prices in January. The annual inflation rate in the core over the last three months has been 2.0 percent, down from a 2.7 percent rate over the last year. The overall inflation rate has been 2.7 percent over the last three months, up from 2.1 percent over the last year. The jump in medical care costs reported for January will not be repeated, but it suggests that the moderation in medical care inflation reported in prior months' price data was an anomaly. With the January jump, the annualized rate of inflation over the last three months is 5.0 percent, compared to a 4.3 percent rate over the last year. The rate of inflation in medical care going forward will probably be close to 4.0 percent. There were a number of other anomalous numbers in this report, which were largely offsetting. On the high side, tobacco costs jumped 3.1 percent in January and hotel prices rose by 1.1 percent, bringing the annual inflation rate in these components over the last quarter to 18.3 percent and 8.4 percent, respectively. Both series are very erratic (tobacco costs probably reflect new taxes put in place in January), and are likely to show much lower inflation in future months. On the low side, communication costs fell by 0.4 percent in January, bringing their annual rate of decline over the last three months to 5.7 percent. This compares to a 2.0 percent rate of decline over the last year. It is likely that some of the recent price declines will be reversed. Tuition costs rose by just 0.1 percent in January, after rising 5.8 percent over the last year. Tuition will almost certainly rise more rapidly in the months ahead. Rental inflation continued to moderate in January. The owner equivalent rent component, which accounts for more than 30 percent of the core CPI, rose by just 0.2 percent. The annual inflation in this component over the last three months has been 3.5 percent. This is down from a rate of more than 5.0 percent last spring. The downward trend is undoubtedly attributable to the nationwide glut of vacant units, especially ownership units. Many homeowners are being forced to rent out houses that they are unable to sell after they move. The rent proper component rose by 0.4 percent in January, bringing its inflation rate to 4.8 percent over the quarter. This higher rate reflects the impact of utility costs being passed on in rent. Car prices fell 0.2 percent in January and have fallen at a 4.4 percent annual rate over the quarter. Car prices are likely to flatten or rise modestly in the months ahead. There is little evidence of inflationary pressures at earlier stages of production. The overall finished goods index fell by 0.6 percent in January, while the core index rose by 0.2 percent. The core finished goods index has increased by 1.8 percent over the last year, which is probably close to its current underlying rate. The core intermediate goods index was flat for the second consecutive month in January, after falling 0.4 percent in November. Weakness in the prices for many industrial supplies, notably construction, is containing inflation in this index. The overall inflation picture remains somewhat mixed. There is no evidence that inflation poses any serious problem, but it is likely that the core inflation rate will be near the Fed's 2.0 percent target in the months ahead, as rising health care and tuition costs are not offset by sharply falling car and communications prices. The revised productivity data that will be released next month, which will show substantially slower productivity growth for both the last quarter and the last year, is likely to raise concerns over the future course of inflation.

1NC

Inflation causes interest hikes and collapses the global economy.

People's Daily, 12-2-06  "Declining US economy impacts other economies" http://english.people.com.cn/200612/02/eng20061202_327622.html

Once the value of the dollar plummets by large margins, the United States will be forced to raise the interest rate dramatically to keep the assets in US dollars attractive. This would constitute the triggering factor for the dwindling of the assets market and for economic stagnation. In the scenario of the hard landing of the US economy, other countries' economies would not be able to remain intact. The decline of the economy of the United States, which is the world's largest market for imports and the No 1 recipient of foreign direct investment, would negatively impact other economies.

Global economic collapse causes extinction

Thomas Bearden, Association of Distinguished American Scientists and LTC, U.S. Army (Retired), 2000 ("The Unnecessary Energy Crisis: How to Solve It Quickly", http://www.seaspower.com/EnergyCrisis-Bearden.htm)

History bears out that desperate nations take desperate actions. Prior to the final economic collapse, the stress on nations will have increased the intensity and number of their conflicts, to the point where the arsenals of weapons of mass destruction (WMD) now possessed by some 25 nations, are almost certain to be released.~ As an example, suppose a starving North Korea {[7]} launches nuclear weapons upon Japan and South Korea, including U.S. forces there, in a spasmodic suicidal response. Or suppose a desperate China--whose long-range nuclear missiles (some) can reach the United States--attacks Taiwan. In addition to immediate responses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict, escalating it significantly.Strategic nuclear studies have shown for decades that, under such extreme stress conditions, once a few nukes are launched, adversaries and potential adversaries are then compelled to launch on perception of preparations by one's adversary.~ The real legacy of the MAD concept is this side of the MAD coin that is almost never discussed. Without effective defense, the only chance a nation has to survive at all is to launch immediate full-bore pre-emptive strikes and try to take out its perceived foes as rapidly and massively as possible.As the studies showed, rapid escalation to full WMD exchange occurs. Today, a great percent of the WMD arsenals that will be unleashed, are already on site within the United States itself {[8]}. The resulting great Armageddon will destroy civilization as we know it, and perhaps most of the biosphere, at least for many decades.