Got up to see how the solar light (and a gaggle of camp 
followers) is working.
No sun so I cant see ... ;-)

>>>>> It's well known that when governments just 'print 
>>>>> money' arbitrarily
>>>>> that the system falls apart, but I don't know how the 
>>>>> cost gets
>>>>> distributed when it is done in a controlled manner.

>>>> I think the word you're looking for is "Zimbabwe"
>>>
>>> No,

> Look for "Brazil" and "hyperinflation".

No.
Almost nobody seems to be addressing what I'm trying to ask. 
Somebody did in one post.

Anyone wishing to respond to this in any detail may wish to 
look at scenario 3 below as the most easily compared to the 
present system.

1.    Assume that the amount of money that is spent is 50% 
of the net amount taken by the old taxation system that this 
system replaces. As there are now, as the supporting 
respondent noted (thankyou that man), no tax department, 
collection mechanism etc the money available will be MPRE 
than 50% of the gross tax take as there are now less costs. 
eg in NewBabwe the prior net funds available to the 
government under the old tax system was $NB10 billion per 
annum. Under the new system that government effectively 
prints $NB5 billion in extra currency and spends it as 
considered appropriate. BUT they levy no taxes. Gross 
government expenditure drops as far as the community is 
concerened from $NB10 to $NB5. Net government spending power 
reduces by a lesser ratio.

What is the effect on the economy.

2.    Government spends the money on purchase of goods and 
services in 50% of the total areas where money is spent by 
the populace. The other 50% receive no government spending. 
If this arrangement is *IDENTICAL* to how money is spent by 
the government in the past.
What is the effect on the economy.

>>> What is not clear to me is how the resultant costs would 
>>> be distributed
>>> across the economy. The original recipients of the 
>>> "fake" money are not
>>> obviously disadvantaged as the money is just as real. If 
>>> anything they
>>> benefit from the business, as they would with any 
>>> government purchase.
>>> But, how does the cost then transfer across the society 
>>> as a whole?
>
>> I feel its a pretty fair tax with few loopholes that I 
>> can see. Rather
>> than taking money out of peoples pockets you make the 
>> money in their
>> pocket worth less. Provided you keep it in check (10% or 
>> so of the GNP
>> of your society or something is allowed to be printed 
>> each year) the
>> benefits would be immense.

As above. In this contrived example the government takes say 
HALF the gross money it did before.

3.    You could assume that the government receives exactly 
the same as the gross tax take was before so that their net 
funds availability is higher as there is no tax depatrtment 
etc. This is perhaps the best example to address.




        Russell

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