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No. Taxes do not fund spending.

That's semantics. In that model, you need to destroy money to avoid it becoming worthless.

Unless the rentier was planning to spend the money on real goods and services, taxing it away does nothing to create spending room for the sovereign.

If you tax rentier, you destroy costs. If you tax labour you destroy wealth.
If money creation creates just rents/interest, it destroys wealth. And to avoid destruction, you must stop printing money, right? Like Michael Hudson says, interest grows exponentially, productivity linearly.
Keynesians seem to think that more money = more wealth. That's not the case. The issue is income distribution, not money creation.

by kjr63 on Sun Jun 12th, 2011 at 05:56:13 AM EST
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