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0 pointsflaviut3y ago0 comments

I'm not an economist. But I can see inflation being thought of as a type of tax.

I'm not sure what kind of incentives that creates, and if those incentives are better or worse than the incentives existing taxes create.

So, maybe?

0 comments

ErikVandeWater3y ago

Off the top of my head, some results would be:

1. No one wants to lend to your country again because you paid them back with currency far less valuable than expected

2. Nobody wants to use your currency as a means of exchange in international transactions because it can fluctuate suddenly

3. Massive redistribution of wealth from savers and lenders to borrowers (maybe a good thing on the whole, but devastating for people headed into retirement)

4. Anything (including govt. programs) that aren't indexed to inflation are suddenly far less valuable

ClumsyPilot3y ago

All of your post assumes that when government creates money, it causes inflation, and when private banks create money, it causes no inflation. No such distinction exists. Most money is created by private banks.

ErikVandeWater3y ago

I know most money is created by private banks. But that is stable (it is assumed by ceteris paribus). If a government decided to stop taxing then that would be something new.

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0 pointsflaviut3y ago0 comments

I'm not an economist. But I can see inflation being thought of as a type of tax.

I'm not sure what kind of incentives that creates, and if those incentives are better or worse than the incentives existing taxes create.

So, maybe?

0 comments

ErikVandeWater3y ago

Off the top of my head, some results would be:

1. No one wants to lend to your country again because you paid them back with currency far less valuable than expected

2. Nobody wants to use your currency as a means of exchange in international transactions because it can fluctuate suddenly

3. Massive redistribution of wealth from savers and lenders to borrowers (maybe a good thing on the whole, but devastating for people headed into retirement)

4. Anything (including govt. programs) that aren't indexed to inflation are suddenly far less valuable

ClumsyPilot3y ago

ErikVandeWater3y ago

I know most money is created by private banks. But that is stable (it is assumed by ceteris paribus). If a government decided to stop taxing then that would be something new.

1 more reply

j / k navigate · click thread line to collapse