Daniel Unplugged Posted April 9, 2014 Posted April 9, 2014 There are 3 ways a government can fund itself, taxation, inflation and debt. I will make the case here that, from a practical perspective, they are all but indistinguishable. If a government is funded through taxation, spending power is transferred from the private sector to the government. The public will never have that spending power returned to them. The same is true of a government funded by inflation, and interestingly, a government funded by debt. Government debt to the public cannot be repaid in any meaningful sense. If the debt is repaid by printing money, an amount of spending power is taken from the private sector via inflation, and that same amount of spending power is returned to the private sector as a "repayment". It might as well have never happened. The same it true of paying back the debt via taxes. "Well mr. private sector it seems I owe you a trillion dollars. In order to pay you a trillion dollars, I need to tax you a trillion dollars. So since you owe me a trillion in taxes, and I owe you a trillion in past debts, lets just call it even." All government spending is the same, regardless of the source of the money. It is a permanent transfer of spending power from the private to the public sector.
GRosado Posted April 16, 2014 Posted April 16, 2014 There are 3 ways a government can fund itself, taxation, inflation and debt. I will make the case here that, from a practical perspective, they are all but indistinguishable. If a government is funded through taxation, spending power is transferred from the private sector to the government. The public will never have that spending power returned to them. The same is true of a government funded by inflation, and interestingly, a government funded by debt. Government debt to the public cannot be repaid in any meaningful sense. If the debt is repaid by printing money, an amount of spending power is taken from the private sector via inflation, and that same amount of spending power is returned to the private sector as a "repayment". It might as well have never happened.The same it true of paying back the debt via taxes. "Well mr. private sector it seems I owe you a trillion dollars. In order to pay you a trillion dollars, I need to tax you a trillion dollars. So since you owe me a trillion in taxes, and I owe you a trillion in past debts, lets just call it even."All government spending is the same, regardless of the source of the money. It is a permanent transfer of spending power from the private to the public sector.Isn't this from a video?
GRosado Posted April 17, 2014 Posted April 17, 2014 Currency Failures from Argentina to Zimbabwe: A B…: The three forms are mentioned in the video but not everything else
GRosado Posted April 17, 2014 Posted April 17, 2014 Accidentally posted a second one, so disregard this.
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