[Luis Dias]

So you are not paying attention, since I said that this value would be indexed to inflation

[MP-Ryan]

So you are not paying attention, since I said that this value would be indexed to inflation

In a supplemental post you said "The 500$ a week would rise (or lower) according to inflation" by which I didn't take you to mean indexing, but if you did then fair enough.  [I had read that initially as the value of the supplement would rise and fall when acted upon by inflation.]

[Aardwolf]

I'm not arguing against strawmen, I'm pointing out that even basic economics makes a plan like that pointless.  Luis, the point is that something like a basic income guarantee becomes moot if everyone is entitled to it - inflation will raise prices to the point where the guarantee is worthless because inflation is controlled in part by levels of disposable income, and affects both pricing and income levels itself.

I would like to point out something I think you may have missed...

There is only inflation if the government does not take in [as much as they spend].

When the government spends, it's inserting new money into the system, either by increasing the amount in someone's account, or literally minting new currency. Likewise, when the government taxes, it's removing money from the system. The government can add as much money to the system as they want--- there will only be inflation if they fail to remove as much from the system.

That's what taxes are for.

[Herra Tohtori]

Taxes don't remove money from the system (whichever system you refer to).

They don'y magically exit anywhere. They are used to invest in new things, fund government salaries, public services etc. etc. Taxes stay in circulation.

Taxes are an expenditure to the taxpayers but income to the state.

However, as the state utilizes the income, it's paid back to the taxpayers either in services, goods or even direct salary if you happen to be employed by the state in one way or another.


Example: Rolf Roadmaker pays a tax. Then he's hired to build or fix some road, which is funded by the state.


Could you exemplify what you mean by "taxes remove money from the system"?

[Aardwolf]

online book I skimmed recently which I'm recalling the idea from

Of the money that is collected as taxes, I reckon almost none of it is cash---it's bank accounts. Of course, I suppose it's similar when a private individual collects more money than they spend... while they sit on their money, that money won't do anything... but yes I suppose it still exists.

But unlike an individual, the government can literally create money out of nowhere.

[Mr. Vega]

Mixed economies with counter-cyclical fiscal and monetary policies and large social spending are as American as apple pie. See American economy, 1937-1980.