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Government Spending Myths Debunked Video
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Government Spending Myths Debunked Video
Topics:
Steve Keen considers the following as important:
This could be interesting, too:
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| Government Spending Myths Debunked Video |
I think that falls short.
Taxes are not only collected. They are first of all demanded. Demanding taxes is at the very beginning of all and tax collection at the very end.
Demanding taxes indebts the population. This liability of the citizens then is the asset of the government. This liability defines how much money the government then can create and spend and how much it must collect as taxes. So when it creates money, the state acts like a bank, which lends the money to its population. By putting it straight into the governments bank account, it acknowledges, that the population is already in debt and that the population is owing to the state.
So the population is in the same situation like with private debt, after it did spend the money from the loan.
It is now required to accept the money too, sell something for it and then return it to the bank/tax office.
This is why the population must create a supply which matches the demand of the state and why the state can demand.