Politics & Philosophy by Dr. Martin D. Hash, Esq.
Government has no money. That simple fact seems to escape most people. The only money Government has is the money it collects from taxpayers. Anticipating that revenue, governments borrow money, proposing to pay it back from tax receipts; the government can bond taxpayers to private money-lenders, which is why the concept is called a “bond.” Just thinking about this concept for a moment reveals several egregious problems: first, there is no connection between who benefits from the money and who is obligated to pay it back; second, a significant chunk of the money is siphoned off by the Investment Banks that organize the bond; and third, no one is held accountable for bad borrowing decisions that affect everyone long-term.
There is no logical solution except to take away government's ability to borrow money, meaning no more Government bonds. Government finances should be pay-as-you-go, much as they are now, a Ponzi scheme, and that’s okay as long as everyone goes into the scheme knowing what’s happening and plans accordingly. At the Federal level, there is no need to sell bonds, simply print money. At the State level, create an in-State exchange medium, like Electronic Benefits Transfer, that can be devalued as needed to ensure a Balanced Budget. Bonds are another example of pushing responsibility for the present into the future.
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