The only reason states can wage endless war is because they can endlessly print fiat currencies. #Bitcoin makes war unaffordable.
Discussion
Well, they could endlessly print fiat for the purpose of buying bitcoin. They then wait for the next halfing. Essentially funding a new war every four years.
Well no, they must raise the money from their own people or borrow from allies. Otherwise massive inflation happens.
Name me one war which was financed not via the printing press but taxes
The US funded WW2 predominantly from selling war bonds., and the rest of the wars the US has conducted have been financed on central bank bonds issues. They did expand money supply, controlled it with price controls and ran up a massive debt.
But its impossible to continue to actually print money as out of control inflation will result and your currency will collapse. Like Weimar Germany, Zimbabwe, Venezuela, etc... What most people that complain about just printing fiat here in BTC-ville, is that modern governments with central banks actually do not just print money (or press a button to make more) They issue bonds that they have to repay. The US Treasury bonds (and similar in all modern countries) are issued, just like your local government does to build new roads, in order to fund the government operations when tax receipts will not cover it.
It is not as simple as how I just explained. But any government that just endlessly prints money (an asset) without recording it on their balance sheet (liability) will quickly spiral out of control financially.
You seriously think we are that dumb to think they press a button and just print money when we talk about the printing press? That’s funny.
When the U.S. entered the world war in the early 1940s and began massive deficit spending (partially monetized by the Fed buying a lot of Treasuries). The Fed capped all Treasury yields well below the prevailing inflation rate to inflate away part of their purchasing power.
After the war, the federal debt never really deleveraged much nominally, but they held nominal debt relatively flat for a while, as nominal GDP caught up, partially from growth and partially from inflation, with interest rates capped by the Fed below the inflation rate.
In such a scenario of massive deficits and financial repression like the 1940s had, holders of currency and bonds were effectively partially defaulted on in real terms (often not nominal terms, especially at the sovereign level) and only got part of their purchasing power back. On the other end, debtors effectively got bailed out and only have to pay back a portion of the purchasing power that was owed, even though they largely paid back the full nominal amount in many cases, but in weaker currency units.
That’s stealing from creditors via the printing press.
You are correct, the Fed discounts what they lend to the members banks to this day. that is how they expand the money supply. Done properly with controls on government spending it works great.
And yes, the internet is filled with the people that thing the US Gov just prints up trillion dollar bills, so I mention it. hah!
To be fair, issuing bonds which are bought up by the FED is not far away from just printing money. Sure they have to pay it back, but in the end they just inflate the debt away as I just explained, so they only have to pay back part of it. So a big part of the money they got for free a.k.a printed it out of thin air.
Yep, but that is how money supply grows, confidence that the free stuff will not be a problem. It can never be that way with a fixed supply digital currency
What happens if a fiat nation attacks a Bitcoin nation?
All things being equal, won't a fiat nation have an advantage?
Good question, I also thought about this.
However, since the printing press does not create value but merely steals it from its citizens, the attacking nation might only have an advantage if the citizens of the defending nation are not willing to defend. If your own home and life is under attack, you are more likely to pay for defense via taxes.
If your nation attacks another nation you probably don’t get it financed via taxes, thus the printing press.
In addition, depending on when the Bitcoin nation adopted the Bitcoin standard, the probability is high that they are more wealthy than the fiat nation.
If they win, they still lose by devaluing their currency to zero. It's not a sustainable proposition.
Also, there's a camaraderie amongst Bitcoiners that cannot be broken, but it can be made stronger, through the fight against fiat. Every single Bitcoin Nation will come to the defense of Bitcoin.
Nothing will change until we take the money printer way from the assholes that control the war machine!