> 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.

People don't retain wasting assets - It would devolve into a race
to get out of the currency, with the devil taking the hindmost.

I'm dubious about positing economic behaviour which humans do
not in fact exhibit, except at gunpoint - Remember Marxism?

In reality gov'ts don't either tax OR debase the currency - They
do both.

Jack

On 3/16/08, Apptech <apptech@paradise.net.nz> wrote:
> 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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