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The IRS asking for taxes to be payed in dollars is one of the factors that gives value to those paper dollars, but it is not intrinsic to those pieces of paper

The IRS asking for taxes to be payed in dollars is one of the factors that gives value to those paper dollars, but it is not intrinsic to those pieces of paper it is an extrinsic factor.

jfim 6y ago
I'd argue that it is intrinsic, and to argue about that, we have to think about what it is that makes a US dollar a US dollar, and not anything else. It's clearly not the piece of paper, because I can get many pieces of paper at the store for much less than a dollar. It's not the ink either, since even if I were to get the same ink that's used to make US dollars, mine would be worthless. It's not the pattern of the ink on paper either, as even a photocopy of a bill is worthless. It's not the combination of the paper, ink, and pattern of the ink on paper either, as even if one were to were to pay their taxes with a facsimile of a real bill, they would get rejected. The intrinsic value of a US dollar comes from the fact that the US government is saying that these specific pieces of paper and metal are special. These special pieces of paper and coins are the only ones that they will accept for payment of taxes, and that's the intrinsic value of them.
- magoghm 6y ago
  “ The intrinsic value of a US dollar comes from the fact that the US government is saying that these specific pieces of paper and metal are special.” <—— the US government is not inside the pieces of paper, so it is an entity outside of the pieces of paper, therefore it is something extrinsic to those pieces of paper.
  - tom_mellior 6y ago
    To maybe drive this point home even more, if the US government ceased to exist, or stopped accepting certain pieces of paper and metal as "special", those pieces of paper and metal would lose their so-called "intrinsic" value -- demonstrating that that value wasn't intrinsic in the first place. It's not terribly unusual for old coins and banknotes to be removed from circulation and then losing their status as legal tender. I haven't found examples from the US specifically, but there is no reason to believe that it couldn't be done.
    - perl4ever 6y ago
      People use US currency in some other countries now, independently of the US government. Nothing can stop them, and if the US as an entity went away, nothing would continue to not stop them, until the currency wore out, I suppose. Also, I believe I've read that the US does not declare old money invalid like a lot of countries do. It might be a collector's item worth more than face value but in theory you can still spend it.
  - jfim 6y ago
    From that perspective, a genuine Picasso painting has no intrinsic value above a fake one, since Picasso isn't physically part of the painting.
    - Brian_K_White 6y ago
      Art has intrinsic value that paper money does not, (without getting into the weeds about how the subjective nature of art means that anything can be art if you simply decide you want it to be for yourself, including dollar bills). The intrinsic value in a painting is that I enjoy it. Not how much effort went in to make it, not the market around scarcity and status, but the art. And in that case, indeed the intrinsic value is largely the same between the original and any high quality reproduction. You are both wrong and right. I'm not sure what you thought was so absurd about the idea that a painting has no intrinsic value over a print. You are right, it doesn't (assuming a quality print that is pleasing to look at). It has much other value, but not intrinsic. All the other value is just "we all just decided it's worth a lot of other stuff". All the other value in a Picasso is the same as the value of paper dollars and bitcoin. Exactly as you say.

The IRS asking for taxes to be payed in dollars is one of the factors that gives value to those paper dollars, but it is not intrinsic to those pieces of paper it is an extrinsic factor.

jfim 6y ago

I'd argue that it is intrinsic, and to argue about that, we have to think about what it is that makes a US dollar a US dollar, and not anything else. It's clearly not the piece of paper, because I can get many pieces of paper at the store for much less than a dollar. It's not the ink either, since even if I were to get the same ink that's used to make US dollars, mine would be worthless. It's not the pattern of the ink on paper either, as even a photocopy of a bill is worthless. It's not the combination of the paper, ink, and pattern of the ink on paper either, as even if one were to were to pay their taxes with a facsimile of a real bill, they would get rejected. The intrinsic value of a US dollar comes from the fact that the US government is saying that these specific pieces of paper and metal are special. These special pieces of paper and coins are the only ones that they will accept for payment of taxes, and that's the intrinsic value of them.

magoghm 6y ago
“ The intrinsic value of a US dollar comes from the fact that the US government is saying that these specific pieces of paper and metal are special.” <—— the US government is not inside the pieces of paper, so it is an entity outside of the pieces of paper, therefore it is something extrinsic to those pieces of paper.
- tom_mellior 6y ago
  To maybe drive this point home even more, if the US government ceased to exist, or stopped accepting certain pieces of paper and metal as "special", those pieces of paper and metal would lose their so-called "intrinsic" value -- demonstrating that that value wasn't intrinsic in the first place. It's not terribly unusual for old coins and banknotes to be removed from circulation and then losing their status as legal tender. I haven't found examples from the US specifically, but there is no reason to believe that it couldn't be done.
  - perl4ever 6y ago
    People use US currency in some other countries now, independently of the US government. Nothing can stop them, and if the US as an entity went away, nothing would continue to not stop them, until the currency wore out, I suppose. Also, I believe I've read that the US does not declare old money invalid like a lot of countries do. It might be a collector's item worth more than face value but in theory you can still spend it.
- jfim 6y ago
  From that perspective, a genuine Picasso painting has no intrinsic value above a fake one, since Picasso isn't physically part of the painting.
  - Brian_K_White 6y ago
    Art has intrinsic value that paper money does not, (without getting into the weeds about how the subjective nature of art means that anything can be art if you simply decide you want it to be for yourself, including dollar bills). The intrinsic value in a painting is that I enjoy it. Not how much effort went in to make it, not the market around scarcity and status, but the art. And in that case, indeed the intrinsic value is largely the same between the original and any high quality reproduction. You are both wrong and right. I'm not sure what you thought was so absurd about the idea that a painting has no intrinsic value over a print. You are right, it doesn't (assuming a quality print that is pleasing to look at). It has much other value, but not intrinsic. All the other value is just "we all just decided it's worth a lot of other stuff". All the other value in a Picasso is the same as the value of paper dollars and bitcoin. Exactly as you say.