Only three ways for government to get money

Lithium381

Lifer
May 12, 2001
12,452
2
0
There are really only three ways the government can get money, that it can then spend on its projects. All three are terrible for individuals. First, they can tax individuals on their work or any arbitrary transaction. This also includes fees such as "licensing fees" and tariffs. Second, they can borrow money, either through bonds locally, or from international entities. Third, they can simply print more money.

The first way, taxation, is terrible for the economy because it's taking productive dollars out of the hands of individuals who will use it better than the government can. Even if you subscribe to the (flawed) theory of keynesian economics where ALL government spending is divine, you're operating under the assumption that someone else somewhere who has never met you knows better how to spend your money.

Borrowing money, while a temporary benefit can be seen, loads us with debt for future generations. Like a payday loan, it's a bad deal! This method, as well as the third method introduce new money into our economy which causes inflation and the devaluation of the dollar. Even when we "borrow" from the fed we're watering down the money supply artificially.

Printing money, well this should be obvious. Making money and currency out of thin air? With the Fed regulating the printing of 85bn / month we're getting hosed on inflation and stacking the deck against ourselves having to pay it back.

Summary: Government spending, derived from how the government gets its money, is bad for us.
 

Juddog

Diamond Member
Dec 11, 2006
7,851
6
81
You forgot to mention making money through interest on loans given.
 

Moonbeam

Elite Member
Nov 24, 1999
73,286
6,350
126
Yes, I know, I was much richer when I lived in the jungle. Business at my banana hut was brisk except for the day a gorilla stole all of them and the chimp police wouldn't act unless I paid them in dollars.

One thing I can tell you though, no matter whether bananas or printing press dollars, you are still going to have to deal with the inevitably of ape mentality even in these days of forums. Have a banana on me.
 

dank69

Lifer
Oct 6, 2009
36,125
30,517
136
There are really only three ways the government can get money, that it can then spend on its projects. All three are terrible for individuals. First, they can tax individuals on their work or any arbitrary transaction. This also includes fees such as "licensing fees" and tariffs. Second, they can borrow money, either through bonds locally, or from international entities. Third, they can simply print more money.

The first way, taxation, is terrible for the economy because it's taking productive dollars out of the hands of individuals who will use it better than the government can. Even if you subscribe to the (flawed) theory of keynesian economics where ALL government spending is divine, you're operating under the assumption that someone else somewhere who has never met you knows better how to spend your money.

Borrowing money, while a temporary benefit can be seen, loads us with debt for future generations. Like a payday loan, it's a bad deal! This method, as well as the third method introduce new money into our economy which causes inflation and the devaluation of the dollar. Even when we "borrow" from the fed we're watering down the money supply artificially.

Printing money, well this should be obvious. Making money and currency out of thin air? With the Fed regulating the printing of 85bn / month we're getting hosed on inflation and stacking the deck against ourselves having to pay it back.

Summary: Government spending, derived from how the government gets its money, is bad for us.
The bolded neglects savings which does absolutely nothing for the economy. The sentence immediately following the bolded builds and knocks down a straw man representation of Keynesian economics exposing just how little you know about it.
 

mjd

Member
Jan 3, 2007
135
0
76
Why is borrowing money bad?
And if it's bad, then why do many successful corporations borrow money at interest rates higher than the US government?

Also, you mention inflation and you seem to be attempting to cite recent money printing amounts. But you don't cite modern inflation numbers? It appears that annual inflation is about 2% or a little under. I'm not sure what your metric for being 'hosed' by inflation is. But if 2% qualifies, then I'm not sure your expectations are realistic.

I'm not sure why you haven't also cited the merits of a gold-backed currency. Or investing in guns and bullets.

Please go on.
 

HumblePie

Lifer
Oct 30, 2000
14,665
440
126
Taxes though is a broad field of review streams.

There is income tax, sales tax, property, and usage tolls that can all be done for example.

Before 1913, the only legal way for the federal government to get money was from tariffs, which is a form of sales tax for exported or imported goods. Income were originally proposed strictly as a way to redistribute wealth in a hardcore capitalistic/hoarding society where the top saves and hoards because it can and the bottom doesn't save anything because they can't.

The OP did forget to mention another revenue stream which is donations.
 

Lithium381

Lifer
May 12, 2001
12,452
2
0
The bolded neglects savings which does absolutely nothing for the economy. The sentence immediately following the bolded builds and knocks down a straw man representation of Keynesian economics exposing just how little you know about it.

Sure, savings are terrible because when people fail to make income, they have some reserve to live off of temporarily. Yep i'm sure thats bad for people. You're saying if we tax all the savings, and the government spends it, it's good for everyone involved?
 

Lithium381

Lifer
May 12, 2001
12,452
2
0
Why is borrowing money bad?
And if it's bad, then why do many successful corporations borrow money at interest rates higher than the US government?

Also, you mention inflation and you seem to be attempting to cite recent money printing amounts. But you don't cite modern inflation numbers? It appears that annual inflation is about 2% or a little under. I'm not sure what your metric for being 'hosed' by inflation is. But if 2% qualifies, then I'm not sure your expectations are realistic.

I'm not sure why you haven't also cited the merits of a gold-backed currency. Or investing in guns and bullets.

Please go on.

you're saying inflation doesn't increase year over year?. Rembmer your grandma saying she 'used to be able to buy that for a dime!' . . .

businesses incur PRIVATE debt that they agree to pay back THEMSELVES. It's not public debt that then requires MORE taxation and MORE borrowing and MORE printing to make up for it "in the name of the people". . .
 

Lithium381

Lifer
May 12, 2001
12,452
2
0
Taxes though is a broad field of review streams.

There is income tax, sales tax, property, and usage tolls that can all be done for example.

Before 1913, the only legal way for the federal government to get money was from tariffs, which is a form of sales tax for exported or imported goods. Income were originally proposed strictly as a way to redistribute wealth in a hardcore capitalistic/hoarding society where the top saves and hoards because it can and the bottom doesn't save anything because they can't.

The OP did forget to mention another revenue stream which is donations.

I considered that 4th source of revenue but realized in reality it isn't realistic. :sneaky:
 

dank69

Lifer
Oct 6, 2009
36,125
30,517
136
Sure, savings are terrible because when people fail to make income, they have some reserve to live off of temporarily. Yep i'm sure thats bad for people. You're saying if we tax all the savings, and the government spends it, it's good for everyone involved?
I didn't say savings were terrible, I said they do nothing for the economy. In other words, you built another straw man: savings are terrible.
 

Lithium381

Lifer
May 12, 2001
12,452
2
0
I didn't say savings were terrible, I said they do nothing for the economy. In other words, you built another straw man: savings are terrible.

#1 if I had savings and fell on hard times, that would increase MY economy and ability to spend during that period. . . that's spending I wouldn't be able to do if i didn't have any savings. . .

#2 who should get to decide how to spend my money other than me(our 539 people in DC who know better?)
 

Lithium381

Lifer
May 12, 2001
12,452
2
0
I didn't say savings were terrible, I said they do nothing for the economy. In other words, you built another straw man: savings are terrible.

That's also why i posited a question to you with regards to my statement. Go ahead and just attack me and not respond to the topic at hand..
 

Moonbeam

Elite Member
Nov 24, 1999
73,286
6,350
126
A lot of people today imagine their economic theories to be superior to the ones we have in place which just means that anybody can chose to be a pissed off asshole and complain and complain and complain. But the majority view will find slow expression at the polls. Meanwhile, we all have to listen to the simpering assholes who have fallen in love with their opinions and imagine their economic theories to be God's.
 

dank69

Lifer
Oct 6, 2009
36,125
30,517
136
#1 if I had savings and fell on hard times, that would increase MY economy and ability to spend during that period. . . that's spending I wouldn't be able to do if i didn't have any savings. . .
A) We have safety nets like unemployment and welfare if you fall on hard times.

B)IF. IF you fall on hard times. If you don't fall on hard times, the money in your savings does nothing for the economy.

#2 who should get to decide how to spend my money other than me(our 539 people in DC who know better?)
We get to vote for representatives who get to decide how to spend our money. If they don't spend it the way we like, we get to vote for other people. If the people you vote for don't win, you have to accept the fact that more people voted for the other people and move on with your life.
 

dank69

Lifer
Oct 6, 2009
36,125
30,517
136
That's also why i posited a question to you with regards to my statement. Go ahead and just attack me and not respond to the topic at hand..
If you want to have a legitimate conversation, brush up on simple logical fallacies so we don't get side tracked again. As for your question, I'm saying that the government spending money that would otherwise be sitting in savings may very well be better for the economy, depending on where it is spent. If it is given to the poor, for example, it will immediately be pumped right back into the economy.
 

EagleKeeper

Discussion Club Moderator<br>Elite Member
Staff member
Oct 30, 2000
42,589
5
0
If you want to have a legitimate conversation, brush up on simple logical fallacies so we don't get side tracked again. As for your question, I'm saying that the government spending money that would otherwise be sitting in savings may very well be better for the economy, depending on where it is spent. If it is given to the poor, for example, it will immediately be pumped right back into the economy.

And where do you draw the line at being Robin Hood?
 

Lithium381

Lifer
May 12, 2001
12,452
2
0
A) We have safety nets like unemployment and welfare if you fall on hard times.

B)IF. IF you fall on hard times. If you don't fall on hard times, the money in your savings does nothing for the economy.

We get to vote for representatives who get to decide how to spend our money. If they don't spend it the way we like, we get to vote for other people. If the people you vote for don't win, you have to accept the fact that more people voted for the other people and move on with your life.

Where did those safety nets come from? Probably point #1 from the OP, if not #2 or #3.

Accept the person i voted for didn't win and move on? When the 'winner' decides to systematically reduce my freedom i should just accept it? i don't have a stake in who "wins" at the polls. I just want them to leave me to my liberty. And i don't have a say in 535 of those people there! I only get a say in 4 of them. . .