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But a large chunk of taxes goes to pay off the debt
by ziofill 2y ago
But a large chunk of taxes goes to pay off the debt
- chgs 2y agoAnd who gets that pay off? And what do they do with it once they get it?
- RALaBarge 2y agoRich people. More yachts.
- itsanaccount 2y agoI seem to get to chime in on questions like this repeatedly (those karma points won't delete themselves.) Lets watch hackernews stubbornly avoid conversations about power and in this case how its accumulated to instead myopically focus on the technical/symbolic stand-ins for power.
- zztop44 2y agoOnly because policy makers choose to do so. They could just as easily create the money the pay off the debt out of thin air. But doing so wouldn’t make sense. Governments will never pay off the debt because doing so would not be good macroeconomic policy. The debt doesn’t exist to be paid off. Governments don’t handle national accounts in the same way households manage their budgets. Don’t think about them the same way.
- dh2022 2y agoWell the past two years showed us that the Fed (the institution that can create money out of thin air) will not do that if inflation goes up. Paying debt with money created from thin air will cause inflation and then the Fed will stop making money out of nothing.
- spacecadet 2y agoYup, but whats the goal here? To reduce debt to 0 and use taxes to directly fund governments? Is it believed that this will lead to a lower tax burden for all? Has this been achieved by any modern country?
- fuzzfactor 2y agoUnder President Clinton 25 years ago there was a budget surplus.
- zztop44 2y agoYes and that was either because the Clinton administration decided that shrinking the money supply was the right macroeconomic policy, or that they decided that a Democrat president delivering a budget surplus was good politics. At the time both were plausible.
- from-nibly 2y agoTaxes curb inflation. They print money to pay off debts.