Some have argued that going single payer would mean that many now working in the insurance industry would loose their jobs. Warren Mosler (below) argues that this were the case then this would be deflationary — not inflationary — so would require lower taxes, not higher taxes, to balance the deflationary impacts of going single payer.
Interesting thought.
While I agree with Mosler’s logic, I tend to be more aggressive than he is when it comes to using taxation to prevent too much private wealth accumulating at the top and long for the day that Dems once again simply argue that too much concentrated wealth is bad because it undermines political democracy.
We don’t tax to fund the government.
We tax to create demand for the currency the government creates out of thin air, to regulate inflationary pressures, discourage bad economic activities, and create a democratic enough economy to sustain political democracy.
Anyway, if single payer does cause deflationary pressures, then either government needs to spend more or tax less to balance out these deflationary pressures.
So, we might need to lower taxes, not increase taxes, to “pay for” single payer : )