Friday, February 4, 2011

It Ain't Your Money

Please consider this typical thought, expressed by a leading liberal thinker:

“In what sense in the money in our pockets and bank accounts fully ‘ours’? Did we earn 
it by our own autonomous efforts? Could we have inherited it without the assistance of 
probate courts? Do we save it without the support of bank regulators? Could we spend it 
if there were no public officials to coordinate the efforts and pool the resources of the 
community in which we live?... Without taxes there would be no liberty. Without taxes 
there would be no property. Without taxes, few of us would have any assets worth 
defending. [It is] a dim fiction that some people enjoy and exercise their rights without 
placing any burden whatsoever on the public fisc. … There is no liberty without 
dependency. That is why we should celebrate tax day …” 
-- Cass R. Sunstein, “Why We Should Celebrate Paying Taxes,” The Chicago 
Tribune, April 14, 1999 

Now, I could not agree more.  He is absolutely right.  How dare anyone depend on the system, and then complain about taxes, especially since taxable are completely voluntary.  Senator Reid is exercised for making such a claim, and the witless interviewer fails to follow up on a clear point.  I guess you actually have to be self-employed to understand that taxes are legally avoidable, largely.  Even Jesus, faced with taxes he explicitly defined as illegitimate, avoided paying them by performing a miracle.

Nonetheless, I criticize the system for two reasons:

1.  All of that protection of wealth is directed at preserving a system that depends on exploitation, and necessarily keeps the pie small while it promotes extraordinary wealth among the few.  In a free market competition would at once limit extraordinary wealth creation and promote division of labor, a better definition of "wealth."  A bigger pie with wider access.

2.  All of the people involved in the services Sunstein cites are unnecessary in a free market. AS we pile regulator upon regulator, enforcement upon enforcement, spy upon spy, we ever misallocate resources to sushi bars, hotels, entertainment, clothes, housing for these people who are not in touch with a free market.

3.  With people oriented to this false economy, for more than 2 or 3 generations, people have lost the cultural capital necessary to start the banks, insurance companies, long line relationships, etc to serve each other.

In places like Egypt, when Mubarak is out, and then his successor is on top of the same system, overthrowing and settling scores will be the order of the day, not economic development, since no one on the ground really knows much about that.  If history is any guide, either the same people will be in charge, or things will get worse.

Long before revolution, there has to be education as to how a free market works.  The tumult in Tunisia started with college grad having a fruit stand condemned. The fruit stand is a good start, but there is much more to an economy.  Not only does the govt have to get out of fruit stand regulation, but banking, insurance, medicine, etc.  But for those to work beneficially, the actors must be versed in free market economics.

Until then, obey gauleiter Sunstein and his ilk, pay the taxes (which of course is a miracle) until you and your children are well versed in how a free market works.  Starting a business is the start of the revolution.


0 comments: