- People do not object to Taxes. They object to what they’re used for. All of them object to some aspect or another. Why? ….
- Because some people’s moral uses of taxes are immoral to others, and vice versa.
- The definition of necessary varies considerably for this reason.
- The way that things are done, via public or private sector, through saving or through intergenerational redistribution, have serious side effects. Conservatives do not object to public health care for example. They object to the government running it instead of just giving people credit cards.
- Libertarians (the intellectual side of the conservative movement) believe that the problem isn’t government; it’s the behavior of people in a bureaucracy that has a monopoly – instead of using competing private firms to keep quality up and prices down.
- The USA redistributes money through government services which are inexpensive, poorly managed, and give terrible results, rather than just giving people the money directly. Most conservatives would prefer that we did not use programs but just gave people money, as long as they were ‘good citizens’.
MAJORITY RULE IS THE PROBLEM
This state of affairs is a natural consequence of majority rule where it is not possible to allocate your taxes only to those spending initiatives that you agree with. Why isn’t it that we can all vote for money to be spent how we want to instead of whoever wins spending everybody’s money the way that they want to?
WHAT TAXES ARE NECESSARY?
- a) The military, and depending upon which theorist you ask, the police. And we have some empirical evidence in both directions on the judiciary. That’s all that’s technically necessary.
- b) There are complex reasons why investments in certain commons require government and that is so that we can outlaw free riding and competition (privatizing public good) and therefore decrease the cost of commons, as well as the willingness of people to invest in them. The problem is that this outlawing competition increases rent seeking and corruption. so it is a two edged sword.
- c) Taxes create a demand for fiat money and fiat money allows governments to control rates of inflation, to borrow cheaply, and to act as an insurer of last resort. All of these things increase the economic capacity of the economy.
This is the maximum set of necessary functions of government that I am able to justify taxation for.
REDISTRIBUTION IS NOT NECESSARY ITS A LUXURY
Redistribution is a luxury that wealthy communities can afford for limited periods of time when they have a structural economic advantage over other nations.
But redistribution that becomes a dependency is an increase in risk since no structural advantage persists for long – generally only a generation or two. Redistribution is not a necessary function of government, it is a luxury function of government.
WHY IN THIS ERA OF TECHNOLOGY DO WE NEED REPRESENTATIVES AND MAJORITY RULE TO DETERMINE THE USE OF OUR TAX MONEY?
Why don’t you just vote your taxes (and some portion of the taxes that others generate if you don’t generate any)? What’s the point of Washington?
(Very little of our budget is discretionary.)