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What's
Wrong With Taxation?
by Tibor R. Machan, Ph.D.
Liberty is incompatible with taxation. This
despite that famous saying by Oliver Wendell Holmes
that "Taxation is the price we pay for
civilization." In fact, taxation is a most
uncivilized way of obtaining funds, given that it
boils down to nothing less than extortion.
Just think of it: You go to work for some
company and are told you will receive a certain
wage but actually receive but a fraction of what
you have been offered. Why? Because a substantial
portion is sent not to you, who earned it, but to
other people. Why? Because if it isn't sent to
them, they will declare the company criminal and
sic the police on it.
So, the company is coerced to take part of your
earnings and divert it to those who have this power
to make them do so. If this isn't exactly like what
the Mafia does when it engages in extortion I don't
know what is. Yes, some of the funds extorted will
be used for purposes that may actually benefit you
and some who are extorted don't protest. But maybe
that's true about whom the Mafia extorts, as well.
And it doesn't matter because what is wrong with
extortion isn't what the money is used for but how
it is obtained, namely, coercively.
Often it is Robin Hood who is held up as the
role model for justifying taxation: Didn't he
"steal" from the rich to "give" to the poor? Well,
not, not really.
In the original version of the legend, Robin
Hood did just the opposite: He stole from those who
stole from the poor and returned the loot to the
rightful owners. In those days the upper classes,
from the king to all his cronies, routinely engaged
in extortion. They disguised this, however, with
the phony claim that everything belongs to the king
and his cronies. Yes, monarchs and those who
rationalized monarchy spun this fantasy and managed
to sell it to the people that they where the
rightful owners "of the realm," that they had a
"divine right" to rule us. This way when the bulk
of the country went to work on the farm or
wherever, they had to pay "rent" to the monarch and
his cronies.
Of course, if I live in your apartment, I pay
you rent. It's your apartment, after all, so you
have it coming to you. But what if you got your
apartment by conquest, by robbing a bunch of people
of what belongs to them? That is mostly how the
monarchs got to rule the realm, by conquest. By all
rights it is the folks who were working in the
realm on the land and elsewhere being the phony,
pretend owners, nothing better. But since they
managed to bamboozle a great many powerless folks
into believing that they did own the realm, the
"rent" had to be paid.
Since, however, the American Revolution put the
lie to this monarchical ruse, the institution of
taxation could not be passed off as some kind of
legitimate rent taking. That major political change
showed once and for all that monarchs were
sophisticated thugs who ran roughshod over the rest
of the people, who violated their basic natural
rights all over the place, by robbing and
conscripting them.
Yet, because of the idea that we do need to have
our rights protected by some means that involve
costs, taxation remained a feature of the society
that followed the change from monarchy to
constitutional republicanism.
Not a lot of taxation, mind you, because it
seemed pretty clear to the Founders that taxation
is in fact extortion. But they didn't see some
other, legitimate, morally acceptable way of
collecting the funds needed to pay government for
its service of securing our rights. Yet, they might
have.
There are other ways governments could be paid
for their service of securing our rights that
couldn't exist without legal protection. Contract
fees, not taxation, could solve the problem.
But this alternative, legitimate method wasn't
in the cards following the revolution, so taxation
remained, albeit in a rather modest form. In time,
however, it got out of hand.
After all, if the Mafia just took a tiny
fraction of income from its victims, most would
probably put up with it all rather than to resist.
But when the amount moves on to 25 to 70 %, it
turns into big time extortion. And that is how we
stand now with taxation become big time
extortion.
Some respond to this by noting that in other
countries taxation is much higher. Sure, because
they are even farther from having lived up to the
spirit and letter of the revolution that America
experienced, namely, removing power from government
and returning it to where it belongs, the
individual citizens. After all, it is America that
is the leader of the free world, with a lot of
other countries, including most of those in Western
Europe, way behind. At least that is how it was
supposed to happen.
Instead, however, the American Revolution was
betrayed and the U.S.A. has undergone a reactionary
period in which it reverted, substantially, to the
policies of earlier systems of government. This
Europeanization of America is a shame, a damned
shame. And it needs to be identified as such before
it has any chance of being arrested.
The first step is to acknowledge,
unapologetically, that the institution of taxation
is not a civilized but a barbaric method to fund
anything, because it amounts to nothing less than
outright extortion, a gross violation of human
liberty.
Machan
Archive
Tibor Machan, adjunct scholar of the Mises
Institute, teaches at the Argyros School of
Business and Economics at Chapman University.
Dr. Machan can be reached at:
machan@chapman.edu
and machatr@home.com
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Books by Dr. Machan

A Primer on Ethics
At
Amazon

Generosity: Virtue in
Civil Society
At
Amazon

Capitalism and Individualism:
Reframing the
Argument for
a Free Society
At
Amazon
More
Books by
Dr.
Machan in
The
Academy Bookstore
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