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To: John Galt 72
I say let’s do away with the pain of taxation altogether. Instead, we should invest in more Swiss-made intaglio printing presses and when various governmental bodies need funding, just print up more treasury paper. Neat and simple.
15 posted on 09/24/2007 7:06:43 AM PDT by trane250
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To: trane250
do away with the pain of taxation altogether. Instead, we should invest in more Swiss-made intaglio printing presses and when various governmental bodies need funding, just print up more treasury paper. Neat and simple.
Neat and simple, in the short run.

In the long run (by which I do not mean centuries, nor decades, nor years - but months at the outside, perhaps weeks) people will react to the increase in the number of dollars by demanding more dollars for the same goods. This will require the government to accelerate its production of dollars, leading the people to accelerate their demand for payment and accelerate their spending in order to not hold a depreciating currency that was worth a loaf of bread when earned but will only be worth one slice of bread if held for a week.

The fallacy of the Phillips Curve theory of a tradeoff between inflation and employment lies in the fact that people respond not only to the number of dollars they are getting but the number of dollars everyone else is getting. The result of which is not merely constant inflation, nor even a constant rate of increase in inflation - the result is accelerating rate of increase in inflation which, in the case of no taxation at all and unchanged governmental spending as a percent of GDP, results in the collapse of the economy in a matter of months or perhaps a year. The economic collapse occurs because, even as the dollar supply diverges exponentially, the money supply collapses because the dollar ceases to be money at all.

And the government itself loses all credibility along with its currency. But hey - "Other than that, Mrs. Lincoln, how was the play?"


17 posted on 10/09/2007 6:31:29 AM PDT by conservatism_IS_compassion (The idea around which liberalism coheres is that NOTHING actually matters except PR.)
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