Comment by Terr_

Comment by Terr_ 14 hours ago

> Daedong-beob unified the various forms of taxes to a single kind: rice. This, in effect, made growing rice equivalent to growing money, encouraging even more production than strictly necessary.

This is still relevant these days, whenever someone talks about linking a currency (and taxes collected in that currency) to a commodity like gold. The market for the metal becomes distorted, and the overall economy distorted as well, vulnerable to anything that might impacts the the mining or refinement of the metal.

Another historical connection might be how the weird status of silver and gold are linked to European colonization.

erulabs 14 hours ago

Rice makes quite a good currency, especially if you only have one primary cultivar. It's relatively fungible and dried white rice more or less lasts forever without spoiling. It's quite nice it has the side effect of also literally being food. If rice had been common in Rome, we might still be paying taxes in rice.

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dluan 11 hours ago

It's still used for bribes in Japan, where earlier this year the agriculture minister was sacked for receiving gifts of rice in the middle of a nationwide rice shortage. His replacement still has an outside chance to become the next prime minister.

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vkou 13 hours ago

> we might still be paying taxes in rice.
As long as the largest form of economic activity was agriculture, and access to hard currency was limited, people were paying taxes with food (or labour in their landlord's fields).
We pay taxes in money because we have a diversified economy, where 90% of us are not subsistence peasants, and the money supply & availability of banking is large enough that we (or our employers) have cash on hand.

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- fluoridation 12 hours ago
  
  >We pay taxes in money because we have a diversified economy
  It's all a fiction, though. Ultimately wealth can be translated to very raw things, like energy, space, and time. Using rice as currency is not too different from using Joules as currency, as it's ultimately just captured and stored solar radiation. The issue with using food as money is not that the economy is diverse, as it's ultimately for the most part powered by people eating. The issue is that if you spend money to make a km^2 of land usable for factories that produce, say, semiconductors, that's not exactly translatable to tons of rice.
  
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  Terr_ 11 hours ago
  
  > Using rice as currency is not too different from using Joules as currency
  There are enough differences that we still need to worry about them: Would you really have no preference between them when there's a famine? Which one would you rather have when someone announces they've just cracked fusion power generation?
  Even among such "suitable" commodities (durable, fungible, divisible, etc.) there are differences in risk/utility which don't vanish simply because there's a market for exchanging the two.
  Fiat currency is significantly more isolated from such confounding factors, at least as long as people assume the government will continue to exist. It doesn't go crazy
  > it's ultimately for the most part powered by people eating.
  I am reminded of the subsistence farmer's reasons [0] for not converting everything they have to/from coinage:
  > The thing is, as the food supply contracts, the price of food rises and the ability to buy it with money shrinks (often accelerated by food hoarding by the wealthy cities, which are often in a position to back that up with force as the administrative centers of states).
  > Consequently, for the [farming] family, money is likely to become useless the moment it is needed most. So while keeping some cash around against an emergency (or simply for market transactions – more on that later) might be a good idea, keeping nearly a year’s worth of expenses to make it through a bad harvest was not practical.
  [0] https://acoup.blog/2020/07/24/collections-bread-how-did-they...
  
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  netsharc 9 hours ago
  
  I guess the convenience of money is that it doesn't even need to exist, they can just be numbers in an SQL table (other database types are available). Imagine needing to ship tons of rice when buying an RTX 5090. Or even buying a datacenter full of them. Nvidia or Apple would need giant silos for all the rice they have (or I guess there'd be Central Rice Storage, and a ledger to say who owns how many tonnes)
  It's funny how too many of us are obsessed about keeping our number in the database as big as possible...
  
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  vkou 11 hours ago
  
  I understand the individual sentences in your post, but I don't understand what overall argument it makes.
  (It also fails to take into account the practical aspects of collecting taxes, which is why food and labour were a common currency for them pre-industrialization, and money is the common currency for them post-industrialization. My post addresses the issue of collecting taxes more than it does the issue of generating wealth.)
  
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vintermann 8 hours ago

One thing that has stuck me in old tax records is that when taxes were paid in natura according to fixed exchange rates (e.g. one cow is two sheep, one measure of butter is three squirrel skins etc.), then government probably actually valued some income more than others. The "market value" of these goods almost certainly didn't match the fixed exchange rates, but people's ability to trade for the best tax unit were also limited (and often legally restricted to the same exchange rates!).

So e.g. pastoralists who paid their tax in actual skins may have been more valued than people who paid their tax in "a skins worth" of grain.

I wonder if there's some good books on this sort of thing.

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imtringued 10 hours ago

>Another historical connection might be how the weird status of silver and gold are linked to European colonization.

Land is a finite resource so people fight over it. If you make your money a finite resource, then people will fight over money as well. It's not very complicated.

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