The question mark makes me think there is some uncertainty here and I am irrationally upset about the ambiguity. Of course it is taxpayers’ money! What is possibly unclear about the situation?
By that logic it's actually Intel's money, because it used to belong to the taxpayer, but the law says that Intel gets it now. The trillion dollars spent on the F-35 was quite an inefficient use of Lockheed's money.
While that's how things work at the district or even state level, that's not quite how money works at the federal level. To a first-order approximation, federal government spending is a tax on dollar-holders, with federal tax corresponding roughly to fealty (such service being delivered to dollar-holders). They're decoupled because the US federal government, via the Treasury, is able to create and destroy dollars.
The IRS is responsible for collecting taxes, but delivers them to the Treasury for reallocation or destruction. Since money is fungible, only the net change in extant money matters, and they don't actually have to destroy and reprint notes… though in unrelated news, they do also do that.
Though, at organisational levels below the central bank… once money has been set aside for the interests of the commons, does it truly still belong to those it was appropriated from? If I give money to a malaria charity, I don't then get to say "hey, spend that money on vaccines instead of nets": it's theirs to allocate as they see fit. If I don't like how a charity organises money, I'll choose a different one: just like how, if you don't like how your local government organises communal resources, you should vote accordingly (which, in theory, works) and otherwise take political action.
> While that’s how things work at the district or even state level,
Aside from the fact the fiscal argument you are making isn’t the most important reason why the “taxpayers’ money” thing is wrong at all levels, its also not accurate even within the narrow view of “where does the money come from” at the district or state level, either, since those entities get funded by sources that aren’t “the taxpayers” as well, including other levels of government, like the feds, for whom you acknowledge (correctly) that it is not true because of money creating power.
But "other levels of government" are also getting the money from taxpayers, and money printing is constrained by its propensity to cause inflation, so in practice the amount of it that happens will correspond to the amount necessary to hit the Fed's inflation targets rather than scaling with the amount of government spending. Consequently any incremental increase or decrease in government spending would have to correspond to the same increase or decrease in tax collection, whether as the full amount in the current year or as future interest payments via deficit spending.
Inflation is when the number of dollars increases faster (or decreases slower) than the amount of value in the (USD) economy does. If the money is invested in a way that creates over a dollar's worth of value per dollar, printing money can actually reduce inflation.
In typical circumstances, such investment possibilities do not exist. However, in disasters (e.g. a 4-year-old virtuoso needs surgery to repair a ventricular septal defect; an average person is homeless and needs a place to live; an asteroid's on a collision course with the planet), creating additional money is often the correct decision. Experts disagree whether the recent pandemic was such an opportunity and – if so – what the correct response was: we saw lots of different strategies playing out in lots of different countries, but I don't think that's helped resolve the controversy.
You're combining two different things. If you print a dollar and use it to improve productivity by more than a dollar, this might not cause inflation, but the same is true of raising general taxes by a dollar and using it for the same purpose. And those purposes are scarce, because by definition they have to have above-average productivity.
If you have one then it makes sense to fund it regardless of whether the money comes from printing or taxes, and the inflationary/deflationary consequences of that spending being priced in. And then we're back to the amount of printing being set by the desired amount of inflation, and any incremental spending on top of that coming from taxpayers.
> but the same is true of raising general taxes by a dollar
No, because taxes pull resources out from specific, easily-measurable areas of the economy, and that has effects on people's motivation. Increasing the value of the dollar applies deflationary pressure. High taxes on economic activity, combined with deflation, is not a good combination: people will stop spending money, and while that does relieve more opportunities for the government to invest in the economy… the competence of governments tends to be concentrated in a few specific areas, and things tend to go wrong when an unprepared government tries to run an entire economy directly.
> And those purposes are scarce,
Assuming the Efficient Market Hypothesis applies, yes. In practice… no, they really aren't. The average person contributes more to the economy than they are paid (a corollary of the theory of mutually-beneficial trade), housing costs less than ¾ of the average person's income, and people are a lot less effective at producing economic value when they have poor living conditions. The only way it would make economic sense to leave people living on the street, or constantly in and out of hotels, is if we assume the currently-homeless are inherently inferior at economic activity. Every UBI study ever has yielded evidence contrary to this assumption… and yet, we still have homeless people and we aren't doing large-scale UBI, because… reasons.
(Note that I'm ignoring the moral, human rights argument. I actually care more about human rights than numbers-go-up: it's possible that my bleeding heart is interfering with my cold, hard rationality, letting me overlook some logical flaw in this explanation.)
> If you have one then it makes sense to fund it regardless of whether the money comes from printing or taxes,
Yes! But humans are not ideal rational economic actors, and groups of humans are even worse. There is so much low-hanging fruit, you don't even need to get into the controversial things (like how exactly to fix / avert a recession) to take advantage of them. We've got years-long waiting lists for chronic health conditions that can be solved by a single drug, or a three-hour surgery. Public transport is eschewed in favour of just increasing the width of roads, leaving people shackled to slow, expensive-to-maintain, time-consuming-to-drive private cars for their travel needs. I have never seen an economic argument that supports the status quo: only political ones.
For some reason, there's usually political will to reduce taxes. (There's currently a European Citizens' Initiative to increase taxes,[0] which has reached the required threshold in France and half the required threshold in Belgium,[1] making it the most popular Citizens' Initiative currently running,[2] but politicians tend to get elected by promising tax cuts.) There's also political will to keep inflation in check. There is rarely, if ever, political will to reduce the numerical quantity of money in circulation (except as it impacts inflation), so I predict that's where many of the resources will come from, if one of the currency-controlling governments (UK, US, EU, Sweden, etc) figures out how to fix some of these problems.
That is the government that decides to spend the money is a fact. Whether the "taxpayers" (and what "taxpayers" means) are the ones that will pay for it, is an interpretation up to perspectives on political economy.
The question mark makes me think there is some uncertainty here and I am irrationally upset about the ambiguity. Of course it is taxpayers’ money! What is possibly unclear about the situation?