[tines]

I know nothing about economics. Can you help me understand how raising taxes helps deal with inflation? Is the idea that the federal government "deletes" some of the money it receives through taxes, like the opposite of printing more money which cheapens the existing supply?

[frankfrankfrank]

Yes, on the face of it. The issue with what appears to be the same old game is that those who absconded with the wealth pillaged through funny money, are not going to be the ones getting punished to “fix things”. This opens up a whole different set of cascading consequences because now on top of the moral hazard we had, we’ve gone well beyond that because the perpetrators have learned there are not only no consequences, but that you will be rewarded for your evils.

Combined with other factors too numerous to really go into here, we are seeing the emergence of essentially an aristocracy in the USA and Europe, consisting of, as the earlier aristocracy, of the pillagers of their own people and the people of the rest of the world.

[lifeisstillgood]

You have stated Modern Monetary Theory precisely. Yes that is the new modern argument - government prints money, spends it on hospitals etc thus putting it in circulation and deletes it by taxation.

One HN comment == ten years of economic debate. :-)

[adolph]

Too bad malloc gets called significantly more often than free.

[AnimalMuppet]

That is an interesting idea, but it won't happen, because Congress won't "delete" the money. Instead, they'll spend it.

[convolvatron]

that would .. actually make sense. I can't imagine anyone who is winning in the status quo being anything but horrified at the thought.

has any currency ever done this? isn't there a risk of a Japanese-style concurrent inflation and recession?