2/ Central gov'ts don't need your taxes to pay for stuff (state and local gov’ts do). They gave it to you in the 1st place! Why would they need it?
They don’t just "don’t need your money to pay for stuff," they **can’t possibly use** it to pay for stuff.
They don’t just "don’t need your money to pay for stuff," they **can’t possibly use** it to pay for stuff.
3/ The central government (or, “the state”), which is the one and only monopoly currency issuer, doesn’t need your money, It needs YOU to need THEIR money, and it does this by imposing taxes.
Why do they do this? So you do stuff that society needs doing.
Why do they do this? So you do stuff that society needs doing.
4/ Examples of what society needs doing: Soldier, postal worker, judge, teacher, etc.
These workers need stuff as well. Examples: hotel room cleaner, grocery store cashier, barber, gas station attendant, waitress, etc.
A gov't must "provision" itself. youtube.com/watch?v=iT4JLI…
These workers need stuff as well. Examples: hotel room cleaner, grocery store cashier, barber, gas station attendant, waitress, etc.
A gov't must "provision" itself. youtube.com/watch?v=iT4JLI…
5/ Another example: Let's say Medicare For All becomes law, & pretend it mandates new wings to be built onto hospitals across the country. The wings must be built (requires labor & materials) & once opened, must be operated (labor, equipment, medicine).
6/ This concept is known as chartalism (en.wikipedia.org/wiki/Chartalism), or the state theory of money: the idea that the money in all major societies (over the past ~5,000 years) originated with the state (the central government). 
7/ There is no historical evidence that any major economy was ever based on barter. There is also no evidence that gov’t money was ever an attempt to "improve" the barter money system. This is thoroughly documented in the 2011 book Debt by @davidgraeber: archive.org/details/debtfi…
8/ In #MMT parlance, chartalism is referred to w/ the phrase "taxes drive money." The imposition of taxes (or more specifically, the state accepting it in the PAYMENT of taxes) coerces its citizens to use (in the US) the US dollar. Economist Randall Wray: neweconomicperspectives.org/2011/07/mmp-bl…
9/ No matter what, however, things must be bought and debts must be paid. The imposition of federal taxes is why they pay for those things with the state’s money (such as the United States dollar in the US).
10/ Brutal examples of how new currency is created by the imposition of taxes can be found in how African countries were colonialized by Europeans. This is briefly documented in part two of this 1998 paper by economist Pavlina Tcherneva (@ptcherneva): moslereconomics.com/wp-content/upl…
11/ Wray more thoroughly documents the state theory of money as it relates to #MMT in this 2014 paper: levyinstitute.org/pubs/wp_792.pdf
12/ From the 2005 paper by @wbmosler and @mattybram, "The Natural Rate of Interest Is Zero": moslereconomics.com/wp-content/upl…
13/ Making transactions between members of the private sector is a 2ndary function of the currency. The mkt exists to provision gov't, not the other way around. They just happen to have some extra lying around which they sell to others. @StephanieKelton: levyinstitute.org/publications/t…
14/ More on the concept of "taxes drive money" from Modern Money Network (@thepublicmoney) founder @rohangrey (video hosted by @DeficitOwls).
15/ Beyond driving the currency, federal taxes (although don’t "pay for" anything) are still very important.
16/16 To #LearnMMT in general, here’s a good place to start.
