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This is the real problem with fractional reserve systems. In theory they could be used to damp out the business cycle. In real democracies voters always want
by gozur88 9y ago
This is the real problem with fractional reserve systems. In theory they could be used to damp out the business cycle. In real democracies voters always want low taxes and high spending irrespective of the state of the economy.
- vanderZwan 9y ago> In real democracies voters always want low taxes Would they have to always want that though? I mean, I believe a lot of things can be made more efficient by economies of scale, and in some cases avoiding perverse incentives of for-profit motives (the stories I keep reading about the worst of the American prisons come to mind). In other words: that some systems work best when handled by the government. So I have no trouble believing there are situations where paying more taxes gives me the best value for money in terms of increasing personal happiness, because they would be spent on improving those systems. I'm not sure if there is any government out there currently that I trust that much, but it's sounds hypothetically possible to me.
- gozur88 9y ago>the stories I keep reading about the worst of the American prisons come to mind That's a misconception. State run prisons are no better. Regardless, it's not that people don't want government to provide services. They want government services and they want low taxes.