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I don’t completely follow the logic yet. If the government stopped collecting taxes, they could only fund services by taking on ever-increasing debt, right? It’
by titanomachy 8mo ago
I don’t completely follow the logic yet. If the government stopped collecting taxes, they could only fund services by taking on ever-increasing debt, right? It’s not like money created by central banks just goes straight into the government’s income.
- eucyclos 8mo agoOfficially no, though bond purchases are the most common thing central banks do with cash. Unofficially though, new currency is mostly worth anything at all because it's backed by the 'full faith and credit ' of the hosting country. Faith and credit to accept it as payment for future debts to the country, ie taxes.