Taxes = Proof of Work

[wolverine.ks]

In middle school we had to run laps in physical education. 5 laps =  A, 4 laps = B, 3 laps = C etc.... After each lap we would be given a popsicle stick to prove that we did the work required to get the grade. Obviously, the sticks had no intrinsic value, and were not backed by anything. However, you could run extra laps and then trade your sticks for goods and services from other students. e.g. The athletes trade sticks for someone else to do their homework.

In this scenario, the teacher is acting as the central bank, the sticks act as a currency, and when the teacher collects them, that is a tax.

If we apply this same scenario to a government/country....Just as the sticks are without value, the taxes collected from the citizens are not valued in and of themselves. They are merely a proof that the citizens have completed the work required by that govt/country.

This would explain why taxation gives currency value, and why a govt does not just print unlimited money (besides hyperinflation). They dont care about the paper. They only care about keeping the population doing the government approved work.

Thoughts?

[1714842281]

1714842281

[2dogs]

If you want to grow (or stimulate) something, subsidize it.

If you want to curtail (or stiffle) something, tax it.

Taxes are a form of social engineering.

[TTBit]

I'd rather be the one enjoying your labor for popsicle sticks.

[EverettMarm]

Nah. They do care about the paper/one-and-zeros, it's what funds all their operations. Governments tax instead of printing themselves money because inflation acts kind of like a flat tax, and modern governments prefer progressive taxes.