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MOSLER'S LAW: There is no financial crisis so deep that a sufficiently large tax cut or spending increase cannot deal with it.

taxes and money

Posted by WARREN MOSLER on October 23rd, 2009


[Skip to the end]

you are addressing a room full of people.

you tell them taxes turn litter into money.

you try to sell your business cards to the group for $5 each.

probably no takers.

you offer your cards to anyone who stays to help clean up the room

no takers.

you then point to the man at the door with the 9mm who’s the tax collector, and no one leaves without 10 of your business cards.

you then repeat the questions.


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11 Responses to “taxes and money”

  1. Ralph Musgrave Says:

    Last time we clashed on this one it was a pretty bruising encounter. Anyway, having donned my body armour, I’d like to point out that in a democracy the people in the room will only accept the business cards, room cleaning, etc if they think these are a worthwhile products. Otherwise they’ll tell you and the fellow with the 9mm to get lost.

    They will also only accept the litter currency if they think it is a stable and viable currency. In short the people will only accept the business card, room cleaning and litter economy if they think this is more or less the economy that would exist in your absence (i.e. in a totally free market or under some alternative democratically elected government).

    On a totally different subject I see “the Obama administration is searching for ways to boost job growth without adding to the federal budget deficit” according to the Wall Street Journal – http://online.wsj.com/article/SB125626099818702945.html. Either he and his friends are mad, or I am.

    Reply

  2. Dave Begotka Says:

    The problem is you are in a room full of monkeys thinking about survivor and beer.

    Reply

  3. Warren Mosler Says:

    in a democracy the people in the room will only accept the business cards, room cleaning, etc if they think these are a worthwhile products. Otherwise they’ll tell you and the fellow with the 9mm to get lost.

    YES, AGREED!

    They will also only accept the litter currency if they think it is a stable and viable currency. In short the people will only accept the business card, room cleaning and litter economy if they think this is more or less the economy that would exist in your absence (i.e. in a totally free market or under some alternative democratically elected government).

    THEY MAY NOT LIKE IT, BUT IF GOVT, FOR ANY REASON, CAN ENFORCE TAX COLLECTION, THAT CURRENCY WILL HAVE VALUE AND THE GOVT WILL GET THE ROOM CLEANED. THAT’S ALL I’M SAYING HERE.

    “the Obama administration is searching for ways to boost job growth without adding to the federal budget deficit”

    TECHNICALLY YOU CAN DO THAT BY TAXING FUNDS WITH 0 PROPENSITY TO SPEND, LIKE MAYBE PENSION FUNDS, AND THEN EITHER SPENDING DIRECTLY OR CUTTING TAXES WHERE THE BENEFICIARY HAS A PROPENSITY TO SPEND THAT’S HIGHER THAN 0. CLINTON DID A BIT OF THIS, IN FACT.

    HOWEVER, THIS WOULD NOT BE MY FIRST CHOICE FOR POLICY. I’D LEAD WITH A PAYROLL TAX HOLIDAY AND $500 PER CAPITA REVENUE SHARING FOR THE STATES, FOLLOWED CLOSELY BY ‘CONVERTING’ (THROUGH MARKET FORCES) TO AN EMPLOYED BUFFER STOCK VS AN UNEMPLOYED BUFFER STOCK AS A PRICE ANCHOR WITH MY $8/HR FED FUNDED JOB FOR ANYONE WILLING AND ABLE TO WORK THAT INCLUDES HEALTH CARE.

    Reply

  4. Winslow R. Says:

    ““the Obama administration is searching for ways to boost job growth without adding to the federal budget deficit”

    I’d add….

    Loans to states at $500/capita wouldn’t add to budget deficit.

    Loant to citizens at $10,000/capita wouldn’t add to budget deficit.

    Reply

  5. Curious Says:

    What if I select only some of the people in the room who cannot leave without 10 of my business cards.

    Will that turn my business cards into money?

    Reply

  6. Brioche Says:

    Keynes, Fisher, Gesell, Major Douglas, Ezra Pound, the Attwoods and the free-silver men, and all the rest of the other monetary cranks called – they want their foolish inflationist ideas back.

    Reply

  7. Warren Mosler Says:

    yes.

    try it!

    those needing cards would offer to buy them for dollars, goods and services, based on the ‘price’ of the alternative means of obtaining them.

    Reply

  8. Curious Says:

    OK, what if I select the people who have to pay this way:

    I offer a beer to anyone, who wants one. Acceptance of beer = obligation to pay 10 cards at the door.

    Will that work?

    Reply

  9. Turning Litter Into Money | NineCents Says:

    [...] Turning Litter Into Money Posted on October 26th, 2009 by Michael From the great Warren Mosler: [...]

  10. Warren Mosler Says:

    offering a beer would work to some degree. you’d be limited in what you can buy by the value of the beer, rather than the value of getting out of the room when you want to.

    Reply

  11. Curious Says:

    Then some guy shows up offering beer for just 1 card each.

    People stop coming to me for beer, instead all they want are my business cards.

    Will that work?

    Reply

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