The problem is if it erodes enough so will the power to collect taxes. They need to pay IRS agents, and they need to maintain a standard of living such that people would keep choosing to pay. I think we’re getting to the point even now with the debt and the in-your-face grift that many people are thinking of just not complying. Gradually and then suddenly.

So while I agree the tax power is part of the backing, ultimately that still comes down to faith too. And once you lose it — and you always lose it when the debt is large enough — it’s gone.

My hypothesis begins on the edge of the event horizon of that happening. We can’t be far, and it’s possible we’ve even crossed it. The biggest question to me is would the government officials really be that sober-minded and clear-headed about it in time to make the move.