Comment by titanomachy
6 days ago
It seems like a reach to say that taxation inherently destroys value. For example, in my country I think universal education, roads, universal healthcare, and border control probably all provide value in excess of their cost, and no one has proven a method of funding those things other than taxation. I guess “value” is a subjective idea, though.
I think the argument is that governments don't fund public goods through taxes but through issuing currency, while taxes guarantee a demand for currency and prevent its devaluation. Hence the 'function' of taxes really is to 'destroy' money to prevent oversupply.
Not sure I disagree, though of course that's not how the system works formally.
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.