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Except for that the money doesn't come from the people, since it is fiat money

Don't you mean "seigniorage" money? http://en.wikipedia.org/wiki/Seigniorage

as opposed to money being collected via taxes.

Isn't seigniorage a type of tax? http://en.wikipedia.org/wiki/Seigniorage

seigniorage is also referred to as an inflation tax [...] the "inflation tax" is paid by those who hold the existing currency, which results from their holdings of currency becoming devalued through inflation because of the introduction of additional money supply.



"Isn't seigniorage a type of tax?"

Yes, but it's not a tax on the people, it's a tax on dollar holders.




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