Hidden taxation through inflation is also an advantage in war.
A country that taxes a lot through printing massive amounts will collect more money than one that only taxes through income. Said country can allocate more to military purposes and win a war against the other country.
The game theory of a world-wide sound-money standard is unstable - once one player abandons it, it incentivizes others to do so as well.
A similar dynamic was the rise of the nation-state itself – it proved stronger than the feudal state due to having larger national armies, and that forced feudal states to turn nation-states too.
-- an excerpt from the 2-minute version of An Honest Account of Fiat Money (2018), originally posted in https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018
2minutebitcoin
npub1p6…9ej3v
2023-05-09 01:50:12
Author Public Key
npub1p63d4vekvuql9zltpp4dezzfk2xxfgjsfqyglf4ju4syalekn4csn9ej3vPublished at
2023-05-09 01:50:12Event JSON
{
"id": "67564161999984fb51f8fed1203dc3ebbe9531fceb9d2bda7a190f9dcb1f6f23",
"pubkey": "0ea2dab3366701f28beb086adc8849b28c64a25048088fa6b2e5604eff369d71",
"created_at": 1683589812,
"kind": 1,
"tags": [],
"content": "Hidden taxation through inflation is also an advantage in war.\nA country that taxes a lot through printing massive amounts will collect more money than one that only taxes through income. Said country can allocate more to military purposes and win a war against the other country.\n\nThe game theory of a world-wide sound-money standard is unstable - once one player abandons it, it incentivizes others to do so as well.\n\nA similar dynamic was the rise of the nation-state itself – it proved stronger than the feudal state due to having larger national armies, and that forced feudal states to turn nation-states too.\n\n-- an excerpt from the 2-minute version of An Honest Account of Fiat Money (2018), originally posted in https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018",
"sig": "9b948df5851698a5f52be75490fe65b3295c8f75e71c786bfba9dc73f7054e7a5588392cf24d464045ddd9f1b07c2b6edb9ed2d5ed1e238dc6ee5461e9773475"
}