Eli5 Why can’t the government just set aside money instead of deducting it from paychecks?

348 views

I was wondering why the government has to deduct taxes from us. Why can’t they set aside what they need to begin with? I think I don’t have an idea of how money truly moves…

In: 0

7 Answers

Anonymous 0 Comments

If you mean, why don’t they print money and set it aside for themselves when it comes time to pay for things, then:

Hyperinflation. The more money in the system, the less each dollar is worth, the more businesses will charge for product and services. When people realize what’s happening, they hoard, driving prices further up. This vicious cycle is why governments, central banks specifically, keep a right control on how much of it’s currencies are in circulation

You are viewing 1 out of 7 answers, click here to view all answers.