On page 83 of this issue is a letter from reader Donald Eaton of Sturgis, MI, concerning my commentary last issue about various government agencies raiding and confiscating the home, church, and land of Pastor Paul Revere, an Oregonminister who refused to pay his property taxes. The letter is fairly typical of the argument put forward by liberals against libertarians like myself when we speak out against tax abuse by government, namely: you use public services, so you should pay taxes.
I won't bother speaking against the more absurd parts of the letter, except to say that Mr. Revere was not expecting "protection if someone were to come and take his belongings or kidnap his child." That's just what the government did to Revere—they took his belongings and tried to take his children away from him, all in the name of unpaid taxes.
I'll just speak against the argument that we should all pay taxes in exchange for government services. As usual, the simple statement put forth by liberal tax collectors misses the point. First, let me state two facts:
- Most people, including me, don't mind paying taxes, so long as they are reasonable and used for the legitimate functions of government. Note the words reasonable and legitimate. Those are words tax collectors never use.
- Most people also don't think tax collectors should have the power of Gestapo police, allowed to intimidate and kill citizens. It doesn't matter if the citizens are eccentric or not; if Thomas Jefferson were alive today, he would be considered an eccentric to today's tax collector.
Now let's look at some background: The 16th Amendment to the Constitution, which vastly expanded Congress's power to levy taxes and inaugurated today's federal income tax, was presented to the states as a way to tax the rich, the corporations, and those who inherited unearned wealth. The states, especially the southern states which had mainly poor agrarian populations, bought into this line and ratified the amendment in 1913. Congress immediately passed a modest tax rate of 1% for a person's first $20,000 in earnings, which is the equivalent of nearly $300,000 in today's money. The top tax bracket was a modest 7% on someone making over $500,000, which is the equivalent of nearly $7.5 million in today's money. So that was the harmless beginning, and by 1939 still only 5% of Americans paid any income tax at all.
Look at the situation we have today. We have come to find out that the government now considers us all rich because, when you take together the combined local, state, federal, sales, and all the hidden taxes on everything from medicine to broccoli, the average American now pays nearly 40% percent of his or her income in taxes. Many of us have to have two working adults in the same family to pay for both our family's needs and the tax needs of government. So much for reasonable taxes.
And how about the legitimate functions for which the government collects these reasonable taxes? Fire and police protection, road building and maintenance, libraries, etc., were paid for by local taxes before 1913. Most Americans have no problem with government raising and spending money on these things. That's not what we mean when we, as overburdened tax payers, complain about taxes.We are complaining about the excess taxes that are collected, the ones that support a huge and inefficient government bureaucracy that can provide itself with a retirement package that dwarfs what the private sector can afford, while at the same time it administers a massive welfare system that has made an entire race of Americans permanent wards of the state.
We are complaining about an incredibly expensive educational system that turns out high school students who can't read their diplomas. And we are complaining about the thousands of special interests who have permanent lobbying offices in Washington D.C. so their pet projects can voraciously suckle at the government teat. Government has gone far, far beyond reasonable and legitimate. That's what we're complaining out.
And what has been government's response when citizens have taken the legal path by going to the ballot box and telling government they were being taxed too heavily? In 1978, when Californians passed Proposition 13, the nation's first successful ballot initiative that rolled back property taxes and limited future ones, government across the board responded by closing libraries and cutting back fire and police services. The government took a "punish the voter" attitude. But no civil servants lost their jobs, and none of the nonessential government programs were cut.
Today when some bloated bureaucracy wants to increase its power it runs a media campaign to warn voters that vital services they need or want will have to be cut unless some newly proposed tax is enacted.
And yes, we tax payers are also complaining about the Gestapo tactics of the tax collecting agencies. You can murder and rape today and some judge or jury may feel sorry for your disadvantaged upbringing and set you free. But try not paying even part of your taxes, and the government may just come after you with guns, just as they did with Revere. By definition the government has decided you are eccentric if you don't want to pay your taxes.
The question isn't should we pay taxes for government services, but should we pay outrageous taxes for excessive government services or services that should be left to the private sector. The question of how much tax we should pay is directly related to how big government should be. I say it should be small, but then again I am just another eccentric.
Somebody shoot me, quick!
