The State: Taking Money Away From Where Your Mouth Is

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The
Questions

I
often find that people around me don’t understand the libertarian
position. They view libertarians, and to some extent, conservatives,
as people who are greedy and selfish, and who want to keep all of
their money for themselves. Generally my argument has been, "why
shouldn’t I want to keep all my money for myself?" To which
anyone with a cause – welfare, warfare, or whatever – replies, "because
then who would pay for my cause?"

Who,
indeed? This is an important question to consider, because in doing
so we learn how the State gets away with doing things that the majority
of people don’t want it to do.

It
seems to me that nobody wants to pay taxes. I certainly don’t. Most
people pay taxes because they think they have to. Two things in
life are inevitable, say people: death and taxes. The grouping is
certainly appropriate, given all the death paid for by taxes. "If
you don’t pay your taxes," my father used to tell me, "you’ll
be in trouble with Uncle Sam." Whether it’s Uncle Sam or the
Grim Reaper, there’s a factor of fear in the payment of taxes. Who
thinks that people would pay as much in tax if tax were strictly
voluntary? Anyone?

But
why don’t people want to pay taxes? Shouldn’t they? After all, those
who advocate a reduction or elimination of taxes are called greedy
and selfish. But we don’t only want to not have to pay taxes – we
also want other people to not have to pay taxes. So aren’t people
who don’t want to pay taxes themselves, but don’t care if others
do, even more greedy and selfish? Isn’t the opposite of greed and
selfishness virtue, and shouldn’t people want to be virtuous?

Goods
and services cost money to produce. If people want goods or services,
they generally realize that they have to be willing to pay for them
in order to get them. Taxes are simply a way of paying for the goods
and services provided by the government. If people really wanted
the goods and services provided by the government, they’d be willing
to pay for them, right?

So
the question is, again, who pays for the causes I mentioned above?
Are people greedy and selfish, or are they virtuous? Are they willing
to pay for what the government gives them, or not? Are the activists,
the progressives, the warhawks, the environmentalists, are any of
these people ready to put their money where their mouth is?

Voluntary
Purchase

I
own a television set. Without going too deeply into the economics
of it, we’ll say that it cost me an amount of money that I had earned
by working a certain number of hours. The decision I made, when
I bought the television set, was whether the television set was
the best use of that money I had, or whether I wouldn’t rather have
something else. I considered my opportunity costs – I could have
bought a bunch of CDs, or a new cellular phone, or a peripheral
device for my computer. I considered how much work I had put in
to get that money, and all the other things I could have done with
those hours other than earning money for a television set. Finally
I decided that the TV set was a good idea, that it would be useful
to me in the future, and that I wanted it more than the amount of
money it cost.

Most
American households contain television sets. In fact, there are
295 million people in America and 219 million television sets. Television
sets are not forced on people – those who purchase them do so willingly,
and voluntarily. They make choices similar to my choice. They decide
that the benefits of having a television set outweigh the cost.
They don’t complain loudly that two things in life are inevitable:
death and television sets. There is no nationwide organization devoted
to the collection of fees for television sets. There is no nationwide
organization devoted to the distribution of television sets to the
poor. In fact, 97% of the households classified as "poor"
by the US Census owned at least one color television set. More than
half of the households classified as poor have two or more color
television sets.

Aside
from the ubiquity of television sets, my point is that there is
a demand for television sets, that this demand is met by a supply
of them, and that the market price is not prohibitive, even to 97%
of poor people. There was no nationwide movement to fill every house
with a television set – it just happened, because people wanted,
with no urging from any political party, to watch television.

People
also buy other things that they want. Cars, houses, computers, digital
watches, cellular phones, even comfortable shoes – all are purchased
voluntarily by Americans because Americans believe that their benefits
outweigh their costs.

An
Offer You Can’t Refuse

I
am not in favor of the war in Iraq. I am not in favor of Social
Security. I am not in favor of public education, public transportation,
monopolized utilities, farm subsidies for corn growers, welfare,
Medicare, Medicaid, foreign aid, the war on Terror, the war on Drugs,
the war on Poverty, or any of the vast majority of things the State
has decided to provide for me. However, the State still provides
me with these things, and still charges me for them.

Let’s
consider the war in Iraq. At no time have I received an estimate
of how much money the war in Iraq will actually cost me. I can’t
equate the war in Iraq with any price. I can’t say, "I worked
this many hours to pay for the war in Iraq," nor can I say
"I could have bought this much other stuff with the amount
of money I spent financing the war in Iraq." Instead, the money
is simply paid for out of my taxes (that is, of course, an oversimplification,
since the war in Iraq is being funded by debt, which you and I and
everyone else will pay for eventually) without any kind of itemization.
Because of the deferment of payment to future tax periods, and the
uncertainty of state-controlled money supply and interest rates,
there simply isn’t any way for me to know, conclusively, how much
the war actually costs me in terms of anything I can understand.
I am not an economist. That is true for most Americans. Unlike the
case of the television set, the war in Iraq is impossible for the
average person to know the cost of. On what, then, do we base our
decision whether or not to purchase it?

Well,
fortunately for us, the confused, adrift public, we don’t have to
make that decision. The decision is made for us – we will purchase
the war in Iraq. The taxes are levied and we pay them. In fact,
there’s a national organization devoted to the collection of fees
for the war in Iraq – it’s called the IRS. Even though millions
of people took to the streets in protest of the war, even though
sixty million people later voted against the President who executed
the war, we are still going to be forced to pay for this war. It
is an offer we can’t refuse.

Some
people are opposed to television. They don’t have to buy television
sets. Some people are opposed to the war in Iraq. They still have
to buy it. People are also forced to buy other things they don’t
want. People in some states have to buy things that benefit people
in other states. People in America have to buy things that benefit
people elsewhere in the world.

If
The Cause Is Just

Nobody
really thinks that war is good – at best it’s a necessary evil,
or a cloud with a silver lining. Nobody really thinks that television
is a necessity – it’s just a luxury, a modern convenience. So what
about things that are good, in an absolute, moral sense? What about
a cause that is just?

Food
is a necessity. Everyone needs food. In America, 2 percent of poor
people say that they "often" do not have enough to eat.
13 percent experience hunger at least once a year. Obviously, this
is a problem. But if feeding these people is such a good cause,
why don’t people do it? Why do they spend their money on TV sets
rather than donating it to charity?

Most
people would agree that education is important. Yet few of these
people are volunteering their time or money toward the cause. Why
is that? Why do teachers make so little money if their services
are so important?

Everyone
agrees that lack of education and lack of food are problems. And
yet most people do nothing about these problems because they look
to the State to solve them. Rather than donating money or time to
soup kitchens, they loudly demand that the government spend more
money on the problem. Rather than taking the education of children
into their own hands, they loudly demand that the government spend
more money on the problem. People believe that since they are already
paying taxes, those taxes should go toward the correction of social
problems. People believe that by paying their taxes, they are doing
their share.

Yet
consider what happens to the money collected by the government.
It is spent frivolously and to no good effect. The education system
gets worse. Instead of feeding the poor, we buy tanks and guns and
bombs and take them to foreign nations to kill people with them.
People have no control over the use their tax money is put to. They
spend money, and the problem gets worse.

If
a cause – like feeding the hungry – is just, then isn’t it worth
addressing in as effective a way as possible? If something is worth
doing, is it not worth doing well? If the provision of education,
a social safety net, and various other just causes are truly things
that people want, does it not make sense to allow them to purchase
these things the way they purchase a television – on a free market?
On the other hand, if these things are undesirable, is it right
to force them on people and force them to pay for them, like the
war in Iraq?

But
must we rely on the charitable impulses of the masses? Given that
government did not invent charity, this might not be such a bad
idea. Right now we rely on the charitable impulses of a few politicians
in Washington. If you were in need, who would you rather have to
rely on – your neighbors, or politicians hundreds of miles away
who you have never met?

The
Answers

When
people want a good or a service they will purchase it gladly. People
buy food and medical care just as surely as they buy television
sets. They want something, so they buy it. They put their money
where their mouth is. This leads to wiser decision-making processes.
People have a concrete way to assess the benefits and costs of a
given good or service. This is called a "price." The "price"
of an object is a dollar amount that allows you to compare the costs
of things. "Price" can only be arrived at by a market
scenario. A State scenario, as I have shown, obfuscates the "price,"
making it impossible for people to know what it is.

Without
knowledge of the price of the war in Iraq, many people supported
it who would have balked at paying for it. These people were not
putting their money where their mouth is. Because of the taxation
system as a means of paying for goods and services, other people
paid for the war in Iraq who didn’t even support it.

People
supported the war without paying for it, and others paid for it
without supporting it. If people really wanted the war in Iraq – like they really want television sets – they would gladly have paid
for it without government urging or State organization.

On
the same token, if people really want to feed the hungry, they will
pay to do it, just like they pay for television sets. They will
put their money where their mouth is. The trouble with collecting
taxes to pay for these things is that people have no power to guarantee
that those taxes will actually pay for causes they believe in. The
State, in levying taxes, takes money away from where people’s mouths
are – away from the voice that should be controlling the direction
of the money. People who want to feed the hungry end up paying for
the war in Iraq.

The
reason that people don’t want to pay taxes is that they don’t want
to pay for things that they consider to be unjust – whether that
is the waging of war or simply the enrichment of politicians and
unscrupulous corporations that feed off of government subsidies.
The selfishness of the libertarian comes not from disdain for our
fellow man, but of a belief that we ourselves are better equipped
to address the problems facing humanity than the State. We’re better
at spending our own money. We’re willing to put our money where
our mouth is.

A
free market system causes people to back up their beliefs and desires
up with action. It encourages cautious decisions and empowers individuals.
A person who truly believes in feeding the hungry has the power
to spend as much or as little of his or her money on that cause
as he or she wishes, without having any of the funds diverted to
other programs or agendas. To defend against the argument that this
individual may not have enough resources to achieve their ends,
I will simply point to the fact that in 1950 a television was prohibitively
expensive to most people, and now even the majority of poor
people have two. The system of voluntary purchase has led to the
consistent increases in quality of life that have brought us to
the point where even our poor people can afford these luxuries.

Conclusion

Now
that I have butchered the phrase "put your money where your
mouth is" over and over again and used it to make a mockery
of all reasonable grammatical rules, I hope that you will remember
it. Beware of people who advocate an action that they themselves
are not willing to pay for. Beware of other people whenever they
are proposing to spend your money. Understand that the reason the
government cannot spend your money well is that it is yours, not
theirs, and therefore they cannot possibly place the same value
on it that you do. Be you selfish or selfless, the most reliable
way to pursue your goals is to put your money where your mouth is.

February
10, 2005

Neal
Zupancic [send him mail]
is a bartender in New York City. He moderates the Knowledge
Is Liberty weblog
.

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