<
https://www.scottsantens.com/how-money-is-born-out-of-public-spending-and-dies-by-taxes-mmt/>
'If there's one thing most people don't seem to understand about how money
works that I think would really help governments work better in the 21st
century, it's that money does not flow in the way we perceive it does. It's an
illusion. What money actually does is pop into and out of existence in a way
that looks like flow. In this post I will try to sufficiently explain that
singular understanding of money.
Okay, so you want to start your own country and create your own currency?
Congratulations! What's step one? Is it to tax your people? How are you going
to get them to pay taxes in a currency that doesn't exist yet? Step one
therefore is to create money out of nothing. Choose whatever you want. Want to
use shells? Okay. Want to carve notches on rocks or sticks? Okay. Want to use
dollar bills? Okay. Want to use ones and zeroes? Okay. Whatever you do, get
that stuff to your people. After your people have money, tax some of it back.
Don't tax all of it back. That would leave nothing for them to use on goods and
services in the private sector. Tax some percentage of it back. Congrats! You
just ran a "deficit", began your "national debt", and gave your money value by
requiring that people pay their taxes in your currency.
Now, what comes next is what really trips people up. Let's say you want a new
bridge built. Where does the money come from to pay people to build that
bridge? Does it come from the taxes you just collected? No. Not as the currency
issuer. As the currency issuer you are not limited to first taxing your people
in order to spend. You can just spend. Remember, you have the power to create
money. No one else but you in your country has that power. Everyone else needs
to acquire money first in order to spend it. People do. Businesses do. Cities
do. States do. Countries without their own currencies do. You however do not.
You just create and spend money. So create the money and use it for your
bridge.
Don't believe me? Listen for yourself to former Federal Reserve Chairman Ben
Bernanke talk about how when the government pays for things, it's “not taxpayer
money," and they "simply use the computer to mark up the size of the account.”'
Cheers,
*** Xanni ***
--
mailto:xanni@xanadu.net Andrew Pam
http://xanadu.com.au/ Chief Scientist, Xanadu
https://glasswings.com.au/ Partner, Glass Wings
https://sericyb.com.au/ Manager, Serious Cybernetics
