Thursday, March 25, 2021

If Deficits Don't Matter, Why Bother with Taxes?

Now, the traditional excuse for taxes is, paraphrasing Oliver Wendell Holmes, that they are the "Price of civilization." Skeptics point out that, historically, societies with very low taxes were often far more civilized-think the Dutch Golden Age, Islamic Golden Age, Victorian England, the pejoratively named "Gilded Age" in American history-that thirty-year golden age when almost everything useful was invented.

Why so much civilization? Because much of what governments do today was done by charities or businesses competing for customer dollars instead of seizing their budget in taxes.

Specifically, Kelton likes that taxes "Remove dollars from our hands, so we can't spend them," leaving more purchasing power for the government.

So taxes make the people poor, and that's a selling point to her, presumably because she thinks governments are really good at lifting people out of poverty.

Aside from the morality of preying on our neighbors, demanding they pay an ever-growing "Fair share" that invariably exceeds what, say, a journalist or professor pays, using taxes for redistribution and punishing-"Nudging," in the fashionable parlance-carries enormous collateral damage.

There is a similar mix of moral and practical costs to using predatory taxes for social engineering.

If the only remaining justification for taxes in an inflationary regime is to redistribute and punish-to erode social harmony in a fiscal war of all against all while impoverishing society and enabling a creeping totalitarianism-then it is much closer to the mark that modern taxes have become not the price of civilization, but the predator of civilization.

https://mises.org/wire/if-deficits-dont-matter-why-bother-taxes 

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