Taxation as Vandalism
Taxation is a Crime of the State and the Enemy of Innovation
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Tags: Add new tag • Bastiat • Broken Window Fallacy • Frederic Bastiat • welfare state
Imagine a small town with only a few small businesses. The best, most prosperous business is the general store, which sells citizens many of their daily necessities. Just across the street is a shop that sells and installs windows. Unlike the general store, the window shop is not doing well at all. The town is policed by one sheriff, an idealistic man who believes that it is not only his right, but his duty, to do what is best for his community to ensure the safety and happiness of all its residents to the best of his ability.
The sheriff is patrolling his town one day when he walks between the general store and the window shop, across the street from each other, and sees that the latter is in shambles, while the former is thriving. This situation strikes him as quite unfair. Why, he asks himself, should the proprietors of these two stores, who (he presumes) spent comparable amounts of time and money in building their businesses, be separated by a large and growing disparity in their wealth and consequently their living conditions?
The sheriff decides he will take it upon himself to remedy the situation—to level the playing field—so he puts a brick through each of the general store’s windows. The window store is immediately flooded with business replacing all the general store’s damaged property. The sheriff is satisfied. He has succeeded in spurring the business of a struggling entrepreneur. His town is once again in harmony.
A month or so later the sheriff is walking the same beat. He notices that once again the general store, having recovered from the vandalism of the previous month, is maintaining a healthy business, while the window store is once again struggling. He decides to repeat his previous actions, once again tossing a brick through each of the former’s windows. And once again, the window store’s business surges as it is charged with replacing the damaged panes in the general store.
But the sheriff realizes that, left to its own devices, the general store will once again recover and resume its thriving business, while the window shop will again falter. So he decides to repeat his window-breaking routine every so often. By doing so, he reasons, he will be supporting an industry that would otherwise fail. He acknowledges the price that the general store will have to pay, but immediately dismisses this thought, realizing that such a thriving business certainly has the money to replace its windows every now and again.
Before this rampage of vandalism by the community’s civil servant, the owner of the general store had been contemplating ways in which to reinvest the revenue that his business was creating. He boiled the situation down to two options. On the one hand, he had been considering an expansion of his facilities. His business had been doing so well that he began to buy more products of more varieties, and, after a while, needed additional storage and shelf space. On the other hand, he thought, he owed much of his success to the hard work of his dedicated employees and felt they deserved a pay raise.
But before he could decide which of the alternatives suited him better, someone had begun to break the windows of his shop regularly. Although his business was not at risk, the costs associated with replacing the windows added up. He had to forgo his plans either for a physical expansion of his business or a bonus for his employees. (See Frédéric Bastiat’s discussion of the “broken-window fallacy.”)
After numerous occasions of vandalism at his shop, the owner of the general store goes to the sheriff and explains to him that the costs of replacing his shop’s windows are hampering his business and that he would like the sheriff to investigate. Much to the shopkeeper’s surprise, the sheriff admits that he, in fact, has been wreaking the destruction on the general store. The sheriff explains his logic, telling the owner that if those windows had not been broken, the business across the street would have gone belly up. As an officer of the law, the sheriff continues, he is charged with safeguarding the public—providing not just physical protection, but financial protection as well. He says that he cannot very well sit idly by and watch as members of the community who have entrusted their well-being to him are driven out of business and forced into poverty.
The general-store owner protests, but what can he do? Under threat of force (that is, of the law) he is told that he must endure the violation and destruction of his personal property for the benefit of the community. The sheriff continues to hurl bricks through the general-store window, and eventually the owner learns to live with this nuisance. Rather than expand his business—and the public service that it offers—or pay his employees more, he is forced to endure the oppression of the law for the sake of a business that could not survive on its own.
This is the crime of the state. Pragmatically, taxation is the enemy of innovation, the broken window in the general store. Philosophically, taxation is the moral—and universalized, or at least nationalized—equivalent of the sheriff’s vandalism. The state feels, in the service of the public, that it must violate the property of some for the benefit of others.
One need not advocate anarchism, however, to see the problems inherent in such a policy. Taxation arguably serves its purpose in providing public services. If the sheriff had restricted his duties to the physical protection of the community’s citizens, he would have been doing his job aptly. Likewise, the role of government must be restricted to the protection of the life, liberty, and property of its citizens. The state oversteps its bounds, however, when it violates one of those three rights—as the sheriff did, and as the federal government of the United States does—even for the benefit of others.
If the sheriff had not intervened, the owner of the window store may have realized that the community did not provide sufficient demand for his product for him to run a successful business. He could then have opened his own general store and competed with the one across the street. He could have vacated the building and rented it to the general-store owner, who needed additional space. But the sheriff’s violation of the right to property, actions that embody the spirit of welfarism and coercive equality espoused by so many in our own government, cannot be justified on any terms.
The United States is moving dangerously close to (and has maybe even arrived at) a system under which those charged with protecting and trusted to honor our rights regularly violate them in the name of mindless rhetorical utopianism and forceful egalitarian mediocrity.
Comment by Sans Authoritas on 31 January 2009:
In other words, you are saying that taking money from people by force or threat of force is morally right if it’s “for their own good,” but wrong if it is taken for the good of others? Some people really have a right to a monopoly on violence? Can a squeegee guy come up, wash my windshield, then point a gun at me and demand I pay him? Really? No? Why can anyone else, then?
Tell me again how someone who takes my money at gunpoint or the threat thereof is supposed to protect my rights from being violated?
Are we really allowed to do evil that good may come of it? Does the end justify the means?
Comment by Royce Christian on 1 February 2009:
“One need not advocate anarchism, however, to see the problems inherent in such a policy… the role of government must be restricted to the protection of the life, liberty, and property of its citizens.”
But Anarchism is but the inevitable conclusion of realising the problems inherent in such a policy. Even while he’s breaking windows, the cop is being paid to do so by both the general store and the window-repair shop. It’s a vicious catch 22 in that the cop lives parasitically off both stores because his pay check is demanded by force, which is essentially the argument I believe Sans Authoritas was making, though I could be wrong. The state oversteps its bounds in even the most basic of every-day operations. There is no role for government.
Comment by Sans Authoritas on 1 February 2009:
Royce, that is precisely the argument I was making. Except I wouldn’t call it a Catch 22, because given the choice taxation and no taxation, there is no “damned if you don’t.”
There is also a difference between government and the State. One can have government without initiating aggression. One cannot have a State without initiating aggression.
The statist mentality is that we are all cogs of the state: a coercive entity not unlike Thomas Hobbes’ Leviathan. The anarchist mindset is that you are an individual, and individuals tend to form societies. The initiation of force or fraud is anti-social behavior, and hence, the State has no place in society. Violence in defense of oneself or one’s neighbor from a real, immediate threat, on the other hand, is perfectly moral. And it is perfectly moral to band voluntarily band together with one’s neighbors to provide physical security. It is also perfectly moral to voluntarily pay a private company to protect the individual life, liberty and property of individuals. Statists want a monopoly of violence. Which is more dangerous? A violent monopoly on violence, or competition in the market of protection services?
The State is a system which initiates aggression against non-violent people. Such a system is not morally justifable.
-Sans Authoritas
Comment by hacksoncode on 1 February 2009:
The problem is that there’s no such thing as “competition in the market of protection services”. Society has tried that before, dozens and dozens of times.
It’s called feudalism.
Unless you believe in a sudden conversion of human nature.
Any company big enough to protect you from all threats is big enough that we might as well call it a State. Do you *really* think if we all hired KBR to provide our security that we’d live in a happy Utopia? Tell it to the Iraqis.
Comment by Lachlan on 1 February 2009:
I would defer to the late Robert Nozick in his enumeration of the “ultraminimal state.”
From the presence of multiple competing defense agencies, one would naturally rise above all others in its capacity to use force, and would hence attract more customers. If we recognize that it is appropriate to wield collective force against those who violate our rights, and if we institutionalize this capacity and justification for violence, the preeminent defense agency assumes responsibility for providing the physical and procedural resources of the most basic and minimal state. In preventing other defense agencies from violating the rights of its clients, the superior agency would attempt to enforce a monopoly on the means of violence. It rightly uses force to protect the rights of its clients, and is entitled, by our contractual obligation with the agency, to resources appropriate for the most basic adjudicative, punitive, and protective duties.
Comment by Hacksoncode on 1 February 2009:
Hacksoncode, there’s also never been anything called an “ultraminimal state,” as Lachlan advocates, that ever lasted over 20 years. People have tried dozens and dozens of times. It never seems to work out for them.
Perhaps it has something to do with the fact that when people begin taking money from others at gunpoint, they cease caring about what their victims want. These criminals don’t represent the victims, they represent the government contractors who are the recipients of the victims’ money. Government contractors who give kickbacks for contracts.
It’s the public choice theory, in action. The State grows, and voting cannot stem its growth. Avalanches start off small, too. Someone starts one, and it rolls down a hillside, using everything in its path to grow bigger, while destroying lives and property all along the way. Good luck keeping states and avalanches “small” once you choose to create them.
I don’t believe in sudden anything. And I don’t believe human nature ever changes. That’s why I oppose giving moral support to anyone who initiates violence, whether it be a common street thug, or a street thug in a pinstripe suit and an American flag lapel pin.
If you think that KBR is anything remotely resembling a “private” company, you need to step away from the Kool-Aid.
Comment by Sans Authoritas on 1 February 2009:
I apologize, that last post was mine. I mistakenly put your name in the first box, not thinking and thereby putting it in as the “addressee.”
Comment by Sans Authoritas on 1 February 2009:
Lachlan, your citation of Nozick is a post-facto defense, or rather, a utilitarian rationalization, on the “need” for the state. I could say “I need shoes,” but it does not give me the right to point a gun in someone’s face and take them.
Nozick’s logic was flawed. First, it is not economically beneficial to engage in constant inter-protection agency warfare. Second, what is the difference between a private company imposing a violent monopoly on its “customers,” and the State? There is one huge difference: in the case of the private company, the victims recognize the men of the private company for what they are: a bunch of thugs who have no right to do what they are doing. People embrace the State thugs, and come up with all sorts of fancy utilitarian defenses for what is nothing more than thuggish robbery.
Is establishing a system that takes money from non-aggressors at gunpoint moral, Lachlan? Is robbery moral?
-Sans Authoritas
Comment by Lachlan on 1 February 2009:
Sans,
The justification for my particular private agency’s violence comes from its contractual obligation to provide that defense. This is the basis of the liberal democratic state. It is the offshoot of the private defense agency in that it is instituted for the general physical protection of its creators. Although we may differ as to the need for such an institution (we as individuals may very well be suited to protect our own lives and persons), the American Federal Government, on which my op-ed was a commentary, was created for just these ends. We can agree that regardless of the moral/philosophical merits of the institutions and principles upon which the nation was founded, the federal government’s obligation entitled the protection of the lives, rights, and properties of the nation’s citizens. Though the United States was certainly not to be a nation of absolute liberty and individualism, the Constitution, the Declaration, and the Federalist Papers enumerated a government placing more emphasis on freedom than any before it (and arguably any since). My essay aimed to show that the federal government has left behind the essentially libertarian roots of its founding, and has undertaken to assume more power over the flow of resources within the country.
Comment by Sans Authoritas on 2 February 2009:
Lachlan, the “Social Contract?” That is your justification for the State? I never signed a contract of initiating violence with anyone. Not even some aetherial document signed with invisible ink.
Likewise, you can be sure that no one else signed any contract that binds me. Furthermore, I sign no contracts that bind anyone else. I owe nothing to anyone except to treat every individual with justice and charity. It is neither just nor charitable to take money from my neighbor at gunpoint, or to choose someone to do it for me.
The State was founded on the idea that a system whereby some men may take money and property from others by violence is moral. This idea is wrong. It is a contradiction of what being human is about, as refraining from initiating violence is a key aspect of what it is to be social and human. The State and its taxation are immoral. Flawed ideas. Anti-social. Everything above and beyond that fact is meaningless and wasted breath.
The only obligations that the individuals in the State have to me is to stop taking my money and to leave me alone. Period.
Now please, answer some of the questions I posed to you. Otherwise, an article such as yours is not unlike writing an article about the best way to abort a baby, yet never questioning whether babies should be aborted in the first place.
Comment by Lachlan on 2 February 2009:
Sans. Your sarcasm and derision are unnecessary. I think you are drawing too much from my argument. My ego is not so large that I would attempt to justify the existence of the state in a one thousand word essay. I simply try to show the faults and injustices in the state’s forceful allocation and redistribution of resources within society.
Notice that I do not directly advocate taxation in any form. I note that welfarism’s faults are apparent and visible regardless of one’s opinions regarding the role of or justification for the state. The story’s general store owner implied consent to the accepted government-citizen paradigm when he sought help from the sheriff, but I did not address whether this consent was legitimate. This was not the argument I chose to address.
The value judgments that I make may have implications for broader political/philosophical arguments, but I do not address those arguments here.
Comment by Walter Bunyea on 13 February 2009:
Yours was as well written and thoughtful an article as I’ve seen in a long while. Great job! You’re a talented fellow, so keep up the excellent work!
I look forward to reading your future contributions to the Freeman and their promotion of liberty.
Walter Bunyea, COL (Ret.)
Comment by Mike Van Winkle on 26 February 2009:
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Comment by patrick on 13 March 2009:
That was actually kind of humorous Lachlan!
One gripe tho…
What\’s with \"the role of government must be restricted to the protection of the life, liberty, and property of its citizens\"??
That\’s crazy talk! You trust a tax-funded socialist monopoly to defend your life, liberty, and property?
Anywhoo, that’s my only gripe. Look forward to your future columns.