no third solution

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Taxation is Theft!

February 6th, 2008

I notice that some people happen upon this blog by the following search query: “taxation is theft fallacy.” I’m unsure as to whether they are looking for evidence that the argument “taxation is theft” is a fallacy, or if they have some other motive for stringing those four words together in that order. Maybe they need an introduction to boolean search?

If it wasn’t theft, it wouldn’t be called a tax, it would be called a market transaction. Coca-cola doesn’t tax you in order to suppy you with soda, Nintendo doesn’t tax you in order to provide you with a Wii. Either you want these things, and value them more than other things you could buy, in which case you purchase them and fork over the cash—or you don’t want them, or don’t value them enough to justify their purchases in light of the opportunity costs. With taxes, generally a service is “provided” with little to no regard given to how much you actually use or benefit therefrom, or even whether you wanted it in the first place. And then you’re forced to pay. The fallacy is that taxes are somehow either justified and/or necessary, after all, we do need the police. Right?

Ask yourself a few questions:

  1. Would you, under any circumstances, voluntarily purchase the services of a group of men whose jobs it would be to kill or kidnap you when you refuse to continue providing for their armaments and training?
  2. Would you, under any circumstances, voluntarily purchase the services of an organization which states in no uncertain terms that in the event you decide to stop buying from them, you will forfeit your house?
  3. What if an organization like one of the above tried to assert a claim against you? Would you submit your dispute for arbitration to an organization owned or operated by the very same individuals?

In case you’re not following, the organizations alluded to above are the police, the government-in-general (i.e., planners, lawmakers, figureheads, etc.) and the courts. Now ask yourself, which is the fallacy: “taxation is theft,” or “taxation is justified and necessary?”

Who will help the poor? What about our security?

Try again.

The house I am purchasing at the end of the month, property taxes alone amount to an additional 40% or so on top of the mortgage payment. For an extra 40% annually (probably far less than that) I could fortify the same house with bullet-proof lucite, gun-turrets, overhead sprinklers, a panic-room, an alarm and security monitoring system, and so on.  I could hire a consultant to evalute areas in which I could reduce my exposure to riske (grounding the outlets, sealing the basement, etc.)  I could mitigate whatever risk remains, with a robust insurance policy.

I already give up an enormous proportion of my salary in taxes. Adding property taxes to this mix will simply increase my burden. Add to that sales taxes, sin taxes, capital gains taxes, and depreciation due to inflation, and there isn’t very much left over. Some quick calculations (even assuming a generously low income tax burden of 25%) indicate that I’ll be giving up somewhere close to 60% of my income in explicit taxes and depreciation. This of course, does not account for the implicit taxes passed forward by the businesses who make and sell all of the things I buy. My true tax burden is probably nearer to 80%. Think about that. Tax Freedom day comes in November if you’re lucky.

Nobody has yet been able to satisfactorily explain how taxation is anything other than a ransom for permission to live.

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no third solution

Blogging about liberty, anarchy, economics and politics