The Tax-Free Society

May 8, 2010

The Tax-Free Society
This is something that Libertarians consider seriously, and it deserves our serious consideration. The Anarchists propose to eliminate taxes, eliminate government and privatize all government functions. Libertarians propose to eliminate most of these functions, leaving a bare minimum of government. Of course these services incur costs and need financial support, but that would be paid, voluntarily, to one of competing corporations, by monthly subscription or fees per service. In many cases an insurance company might provide several of these services.
The immediate objection will be this: some people can’t afford to pay for these services. Must they then live without the safety and justice these services provide? I have 4 answers for that
First, charity is the only chance of survival for people who are really unable to provide for themselves. They must accept what charity, freely given, will provide for them. Any effort to force people to support others is a return to the welfare state and a violation of their freedom. It is in fact serfdom. My perception is that people are very charitable and in a tax free society the truly needy would be pretty well provided for.
Second, people who have very limited means can economically provide many of these services for themselves. With a burglar alarm system, a gun, and the ability to use it, you can protect your life, property, and family, and carry on guerrilla warfare (the most effective kind) against an invading army.
Third, we have the impression that the poor now don’t pay taxes. They do, and the sales tax, property tax, and stealth tax burden them more painfully than people who are better off. The welfare state is mostly a mirage, a trick with smoke and mirrors. A competitive system to provide them with the services they want would serve them better at much lower cost than the wasteful political system which serves us poorly at great cost.
Fourth, If you feel that you couldn’t afford to pay for those services, stop and think. Who do you think is paying for them now? You are, through your taxes. You’re also supporting a huge bureaucracy. A bureaucrat has very little incentive to give you good service. He has a secure job with good pay, lush fringe benefits and retirement pension, all because he has no competition.
You may believe that you pay in more than what you get out of the system (and that’s true for most of us). If that’s OK with you, then that’s a fine charitable attitude. But, honestly, if the tax were voluntary, would you contribute as much as you’re now paying?
Perhaps you would stop to consider that you’re contributing to things you don’t approve of. Private, voluntary charity gives you the option to choose which causes to support, an how much to contribute.. Private, competing service providers would give you the option to get only the services you want, and to select providers that give you the best value for cost.
Now consider all the people who pay their taxes unwillingly, because taxation is compulsory. Do you approve of serfdom?
On the other hand, you may believe that you pay less than what you get out of the system. You’re probably wrong, because you aren’t conscious of the stealth taxes and the taxes that you pay indirectly, such as the property tax on the home you rent, and corporate taxes which are passed on to you in the price of the goods and services you buy from them.
Nevertheless, supposing that you really profit from the welfare state, how do you feel about the fact that you live partly on money taken forcibly from others? Do you feel better about that than you would feel about being supported by voluntary charity? The government tries hard to convince you that you are entitled to these things. If so, who is obligated to provide your “entitlements”? The government doesn’t have the means, other than what it takes coercively from taxpayers.
So here we go. Here are suggestions of the ways we could provide essential services without taxes in a system of anarchy (no Government) with free market solutions:
We have private police systems now. They serve us well. Without the corrupting protection of the political system, and the spur of competition, they must serve efficiently, respect our rights, and minimize violence. They could be financed by subscription, by fees per service, or through an insurance company which insures your security. Such police would not be obliged to protect non-payers.
The libertarians have some very interesting ideas here. Courts, and judges, would be private competitive organizations, paid a fee for their services. They would apply common law, which is well established and serves us well in civil lawsuits. They would mostly arbitrate between 2 parties. The parties would choose the court, and if they couldn’t agree on that, their 2 choices of courts would choose another court to settle the suit. The sentences would mainly consist of fines, with the “guilty” party paying court costs and reparation to the victim, NOT to the state.
We now have privately operated prisons. Although they work for the government, they have proven more effective, safe, and efficient than government owned prisons.
The libertarians, however, prefer a system in which the criminal lives outside of prison, works to provide for his necessities and pay off his fine, and is prevented from “disappearing” by technical means such as a radio beacon or other surveillance, under the control of a private organization which guarantees his detention and behavior. He would be a slave until he pays his debt to his victim.
Private armies can be on call or created quickly by private competing organizations, strictly for self defense. An anarchic society wouldn’t be a desirable target for invasion, for there’s no government that they can take control of, and each resident would have to be conquered individually. For defense we wouldn’t need nuclear missiles or bombers. The armies could be financed by subscription or by the job, or through an insurance company which insures your security. Such armies would not be obliged to protect non-payers. Each member of society, in an emergency, could voluntarily serve as a guerrilla fighter to defend self, family, and property.
All schools at all levels would be private competitive organizations. Costs would be paid by students, their families, or voluntary endowments. Scholarships are already a popular form of charity.
Many Libertarians want this to involve private ownership of all streets and roads, paid for by tolls as with our present toll roads. I differ on this. I think that the ownership of a strip of land completely surrounding my land, (as the streets do) is an absolute monopoly which could make me virtually the slave of the owner of that land. The only solution I can see would involve severe limitations of the ownership of that land which would assure me of reasonable access to the rest of the world. Perhaps roads would be built on the fringes of my property and yours, under lease with the stipulation that we shall have reasonable access to this road and the connecting system of roads.


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