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Lori , the debt came from the massive inflation of the 1970s . Although inflation has improved due to declines in gas prices , consumers remain concerned that an elevated inflation rate will persist during the year ahead , and consumers widely anticipate additional hikes in interest rates next year . A system should be provided for determining and distributing the contingency funds to provide for cost escalation caused by unanticipated inflation or such factors as changed site conditions , design revision , and estimating uncertainties . The liquidity of the banks , which had been pushed up throughout the 1970s creating massive inflation , suddenly reversed course . Our economy 's performance should remain solid this year , though likely with a slower pace of economic expansion and a slightly higher rate of overall inflation than last year . With costs of many covered services-perhaps especially prescription drugs-increasing rapidly in private sector as well as public sector plans , states should expect increases in their Medicaid costs that are greater than the overall inflation rate . This phase of James life came to an end not long before James turned twelve by which time his understanding of the American economy had increased to the point where he realized that the amount of money he possessed was far more than enough to support his and his mother 's modest lifestyle long past his reaching adulthood and that it was extremely unlikely a massive inflation like the one in prewar Germany would wipe out the value of their currency . Another tactic was delaying , cutting or freezing inflation adjustments for Medicaid providers such as nursing homes or home health agencies . However , her theory , based on delving into the impact of heightened competition , does conflict with the popular notion that colleges are in cahoots to raise tuition prices faster than the rate of overall inflation . It will lift the confidence of businesses and consumers and cut overall inflation , boosting the purchasing power of consumers ' incomes .