This actually expands further than taxes and expands to all government services. Water bill, inspections, sewer. Those institutions will always only accept doll

This actually expands further than taxes and expands to all government services. Water bill, inspections, sewer. Those institutions will always only accept dollars, and that backstops the value. Thought experiment: rampant inflation happens and the dollar inflates 10x. My $1M house is now worth $10M. It's reassessed (because I don't live in California) and now my tax bill is suddenly $100,000 / year instead of $10,000! I need to acquire $100,000 or I go to jail. So I start selling assets into dollars. This deflates the dollar. Everyone does this simultaneously and the dollar goes back to its natural value.