currency, originally backed by something of reputed value, namely gold. Later still, 1971 for the USD, came fiat currency backed only by the good faith and credit of the state. What is the evidence that taxes payable in fiat currency are necessary for the public's acceptance of the same fiat currency for all other purposes? As I say, this assertion appears to be central to your reasoning and, therefore, is an important question. Yes, I have read about Chartalism and MMT. In the referenced Wikipedia article on Chartalism, it is the following statement which seems to me to be unsupported: "The demand to hold and acquire this government issued currency is driven by taxes levied by the state -- which typically can only be paid in the state-issued fiat currency." Alexander, MMT is based on the Chartalist theory of money. This debate has been going on in monetary theory for some time, and there is ongoing disagreement. MMT'ers have picked the side with which they agree, with good reasons and considerable evidence, they think. Since this is a disputed question, you could call it an assumption. Different economic schools assume different theories of money based the rationale they judge most rational. If you are interested in this debate, then you should research the literature and come to your own informed conclusions. The principal theories are state theory (Chartalism, Knapp), credit theory (Innes), utility theory (Mises). commodity theory (Classical), quantity theory (Hume) and real bills theory (Smith). beowulf Reply: October 8th,