4 ms·

why would they collect taxes on a currency they have no control over anymore? Might as well start a new currency.

• jerf 4y ago
  Of course the hypothetical is intrinsically a bit silly, but the "US" in "US Dollar" is not extraneous. Even if you did somehow have All The US Dollars In The World, the "US" still would retain control over the currency, inasmuch as the currency that is the "US Dollar" is defined as being the currency they have control over. Even if you had all of them, they would retain the ability to print them, retain the ability to insist that you pay your income taxes to them, etc. There have been many fiat currencies in history to look at. It doesn't take long to see that pure fiat currencies really are based on the full faith and credit of the issuing authority. These issuing authorities don't have to be governments; the only thing stopping private parties from issuing currencies is just that governments tend to see that as muscling in on their turf, but it's not otherwise impossible or even particularly difficult. (Getting everyone to accept your currency is what is difficult.) The US dollar is a derivative of the US government. Something that is not a derivative of the US government is something other than a "US Dollar". The US government really couldn't start a new currency because the base case of the currency, what it really is under layers and layers of finances and financial structures and loans and everything else, is "what the US government accepts". Again, the hypothetical is impossible anyhow, which kind of skews how you think about it, but at its core, at the deepest level, what the US Dollar is is what the US government accepts as payment, and below that, the fact that it is the US Government that will come after you if they are not satisfied with your payment. Anything else that they would accept for the same reason is basically the same thing as a US dollar as a result, and if the US government tried to create "multiple currencies", the financial system would swiftly come to an exchange rate based on precisely how much of the US Government threat can be avoided with each one. That is the base case upon which all the further recursion is based. And again, I'm not making any more claims beyond "that is what it is"; I'm not saying that's obviously good, or that's obviously stable, or that anyone who questions it is an idiot... this post is simply about understanding what is. How you feel about what is, and what further conclusions you come to about what is, are up to you.