Assume that the Fed is just printing money... pretty soon, people will get wise that this money is worthless, and use something else. By taxing in the same currency, people need that money, and that creates demand (and hence value).
Taxes are necessary to avoid the devaluation of the currency (this is what inflation is).
As a matter of fact diamonds are know scam with overinflated price that are controlled by cartels that constrict supply to set and control the price. So is oil!
I can't believe we still talk about it.
The thing is every game is rigged and you must be actually delusional to think otherwise. The "invisible hand" of the free market is real and is there always stacking odds against small and weak.
Could do the same with real estate and the stock market...
Source: see gold.