Person A makes a trade with Person B both are happy... where's the problem?

Hello - I am Ayn Rand
Person A sells something to person B. Both are happy. Where's the problem? Give it a moments thought and, at the end of this paragraph, I'll give you the answer. This blog entry is an attempt to nail an idea to the post which will help people understand how they're being lied to and controlled by an entity which, even by its best advocates, can best be described as an awful fire breathing dragon[1]. The problem with the trade, from our Government's point of view, is: no one got taxed.

Enter person C. Person C corrects the 'problem' by stealing some of the money from both person A and person B. Person C then goes on to invent a series of excuses as to why that's fair. They usually start by renaming their theft as "tax". Then person C pays some of his ill gotten gains to others and they inevitably tend to line up and add additional excuses as to why theft or "taxation" is fair.

I was discussing this with a friend recently. We were talking about the UK's NHS. "But taxation creates jobs for people" was the direction of the conversation. The NHS is a big employer in the UK. However, go back to persons A, B and C. Imagine if person C was to use this logic as an excuse at the time. When A and B looked on in shock as they were being robbed blind there'd surely be laughs all round if person C tried to argue they were creating a job for themselves.

Generally most people trade their time and labour with each other so we can assume persons A and B are lot busier than person C. This means there's time for person C to establish something called 'Government bureaucracy'. This is basically a whole industry which makes excuses as to why they are entitled to steal from us all.

"The burecracy is expanding to encompass the ever expanding needs of a growing bureacracy"

Now this argument is bluntly stated, and I'm not sure I agree with it entirely, but the point of this entry is to remind you that there are two sorts of people in this country. One lot live because they are paid by person C. The other lot are paid because people choose to give them money in proportion to a value which the market decides.

If you're a lefty like I used to be there will now be a thousand internal voices leaping to defend things like the NHS and the welfare system. I have no answer to those problems. It's just worth remembering that Government and the state steal money off you. That's what they do.

Nick Margerrison

[1] The Leviathan is a creature used by a philosopher Hobbes to describe Her Majesty's Government in its most favourable light. Hobbes believed life was at core, "nasty brutish and short". He thought of the Monarchy as being alike to a fire breathing monster called a "Leviathan". This creature was the biggest bully on the pitch and as a result controlled everyone else. Systems of right and wrong, morality, culture and so forth all came from its preferences. Gold, for example, has no intrinsic value but if dragons like it and you're controlled by one you might think it was very precious.

Further reading: Ayn Rand. This piece is inspired by her.


Anonymous said…
Might say that it's the idea of modern Free Trade/Markets that actually creates the need for the state and taxation. The Free Market model which I think you allude to in the example of Person A selling to Person B (without interference from Person C) is supposed to ensure the fair provision & distribution of wealth & resources amongst the population based on principles of supply and demand.

However, in order for this to work we require a "Perfect Market", the main tenant of which being that (wo)man is a perfectly informed, socio-economic being. Without this markets tend towards monopolisation and inequality flourishes.

Without going into too much detail, free market economics relies on us knowing exactly what each company is up to, the price of everything, the true value of everything and us using ONLY this information to make socially responsible purchasing decisions. Others may disagree but the idea that McDonalds is such a large & successful brand suggests that we don't live in a world of perfectly informed, socio-economic beings. 

There are a several other reasons why markets cannot perfect such as true cost of production not always recognised, the impact on the labour market of rapid technology progresses or the billions spent by companies to implant beliefs about their products in our minds. All these imperfections amplified by stock markets that increasingly use technical analysis as a means of investment appraisal (see Adam Curtis' documentary "All Watched Over By Machines of Loving Grace").

So the idea of person C entering the picture isn't just about the NHS or Welfare it's also about correcting market imperfections and preventing the monopolisation of the world's resources.

If you look at the stats bandied around by the likes of your mate Owen Jones ;-) about inequality then I think it's safe to say that pretty much all governments have failed miserably. However, this is a failure of both the state and collective companies (eg the free market economy) to deliver a sustainable & fair means of wealth distribution.

Ultimately, I’d argue that in a capitalist society, Person C is totally required but it's just that the state isn't doing a good job of being person C.

Person C could be a grass roots workers/community movement, environmental campaign, human rights or consumer group but to be effective it needs to hold weight and be able to restrict a corporation's ability to exploit resources to any end for the it’s own profit.

The result of which is pretty much the same as Tax in the sense that it will reduce the overall profitability of most companies. Potential solutions that may not be tax in the technical sense will still be a tax in a practical sense. Think about the ban on child labour or the impact of better health information in respect of smoking.

As far as individuals are concerned, the extremely wealthy usually have benefited from market imperfections so the arguments I've put forward in terms of corporations apply similarly.

My problem with the conclusion that tax on the masses is state theft is that I believe wealth distribution is a zero sum game and if we cut taxes either wages would go down (as the money required to attract someone would be less) or prices would go up (as people have more disposable income but production hasn't increased) so nothing should actually change in terms of how well off people generally were. I am not defending Taxation but I don't understand why anyone would single taxation out as being the major problem with the system. 

I like to think of it as a yin/yang thing or like God & the Devil (who plays who will depend on your political tastes); the rise of one creates a need for or implies the existence of the other. 

Popular Posts