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Governments like the US today can borrow money or print it with very few constraints. Taxes are not primarily about raising revenue. For small, opening (usuall
by Ericson2314 5y ago
Governments like the US today can borrow money or print it with very few constraints. Taxes are not primarily about raising revenue.
For small, opening (usually developing) economies the matter is different, and they should have more capital controls accordingly.
- alister 5y ago> Taxes are not primarily about raising revenue That’s an intriguing comment. Can you explain further?
- Infinitesimus 5y agoI suspect the parent is coming at this from the MMT angle: https://en.m.wikipedia.org/wiki/Modern_Monetary_Theory https://en.m.wikipedia.org/wiki/Modern_Monetary_Theory For states like the USA that print their own currency and enjoy tremendous global demand for their currency, taxes are less about revenue and more about controlling behavior and unemployment outcomes. Some argue that taxes are just a way to force demand for a currency the government has a monopoly on to ensure it always has _some_ value. (Note: this is a rather polarizing theory and still somewhat young. The US Fed pulled off printing trillions last year and things haven't gone to hell yet do there's something there )