Billy's Horse, or the Mill?
lamented Patrick Morkan, our grandfather, that is,' explained
Gabriel, 'commonly known in his later years as the old gentleman,
was a glue-boiler.'
Gabriel,' said Aunt Kate, laughing, 'he had a starch mill.'
or starch,' said Gabriel, 'the old gentleman had a horse by the
name of Johnny. And Johnny used to work in the old gentleman's
mill, walking round and round in order to drive the mill. That
was all very well; but now comes the tragic part about Johnny.
One fine day the old gentleman thought he'd like to drive out
with the quality to a military review in the park.'
have mercy on his soul,' said Aunt Kate, compassionately.
Gabriel. 'So the old gentleman, as I said, harnessed Johnny and
put on his very best tall hat and his very best stock collar and
drove out in grand style from his ancestral mansion somewhere
near Back Lane, I think.'
laughed, even Mrs. Malins, at Gabriel's manner, and Aunt Kate
Gabriel, he didn't live in Back Lane, really. Only the mill was
the mansion of his forefathers,' continued Gabriel, 'he drove
with Johnny. And everything went on beautifully until Johnny came
in sight of King Billy's statue: and whether he fell in love with
the horse King Billy sits on or whether he thought he was back
again in the mill, anyway he began to walk round the statue.'
in a circle round the hall in his goloshes amid the laughter of
round he went,' said Gabriel, 'and the old gentleman, who was
a very pompous old gentleman, was highly indignant. "Go on,
sir! What do you mean, sir? Johnny! Johnny! Most extraordinary
conduct! Can't understand the horse!"'
James Joyce, "The Dead," Dubliners
are many friends of liberty whose goal is to bring back to America
the constitutional republic she once had. As far as I know them,
I find that they are sincere, well-intentioned people. But they
are making a mistake.
I would be happier to live under the federal government as it existed
in 1800 than as it exists today. But, even if we could get back
to that arrangement, it wouldn't last.
Ikeda, in The
Dynamics of the Mixed Economy, explains why. Let us imagine
that we are living in an America with a truly minimal state: it
provides a legal system, defense, law enforcement, and that's all.
For the sake of brevity, we'll lump those services together as "protection."
In order to provide protection, the state must somehow raise the
revenue to supply it. If it does so through completely voluntary
means, it has essentially stopped being a state. Without the power
to extract taxes from its subjects, it will find it impossible to
maintain its monopoly on protective services, as people can simply
stop paying it, and it will lack the means to enforce that monopoly.
the minimal state must tax, it must set the level of taxes, or,
looking at the other side of the coin, it must decide how much protection
to provide. Whatever level of protection it chooses, some people
will be unhappy with the decision. We should especially note that
since, in a constitutional republic, the level of protection will
be set somewhere in the middle of the range of desired amounts,
there will be a large group of people who feel they are getting,
and paying for, too much of it.
not impossible that those people will choose to just grin and bear
it, but it is very unlikely. Humans act in order to improve situations
they find unsatisfactory, and the people paying too much in taxes,
in their own eyes, have the motivation to act.
not paying their taxes will subject them to violence from the state.
But since those taxes were imposed on them by political means, it
will occur to them that they can use the same means to try to gain
some compensating benefit. Perhaps they will lobby to have extra
protection for their neighborhood, to have a military base located
nearby, increasing local trade, or to get street lights on their
road, in the name of increased security.
benefit they wrestle from the state will change the situation of
those who were happy with the old amount of protection. They
are paying the same amount in taxes as before, but some of their
previous benefits have been shifted to others. Now they have
a motivation to form an interest group and lobby the state to provide
them with some new benefit as compensation for their loss.
the meantime, however wise and noble the founders of the state were,
state service will act as a magnet for the person who wants to exercise
power over others. In order to maneuver his way into a position
of power, such a person will have every reason to rub salt in some
interest group's wound. By goading "his" interest group
on in its grievance, a politician can build a "constituency"
that he can ride to power.
may be hard to believe, but soon enough that limited, constitutional
republic you fought for will have a trillion-dollar-a-year budget,
and be involved in every aspect of its subjects' lives. It may seem
like a merely theoretical possibility, but it really could happen!
Oh, wait, it did happen, didn't it? As Bill Anderson recently said on
is about competing individuals grabbing for power, it means that
one group of individuals ultimately is able to take power and
abuse another group of individuals. While political classes like
to couch their actions in terms of "social justice,"
what they really are doing is plundering one set of individuals
and transferring their wealth to their supporters. This is
the only way the system operates. There are no alternatives.
only is the minimal state inherently unstable, but also, once we
buy into the idea, our argument for liberty loses its clarity. Rather
than saying, "It is wrong to initiate violence against others,"
the defender of liberty winds up saying, "Well, it's wrong
to initiate violence against others, ahem, except when a duly constituted
body, representative of the people, after careful deliberation,
decides it's right to initiate violence against others, don't you
why is it difficult for people to abandon the belief that we need
to enthrone an originator of violence in order to have a peaceful
society? Some people have fallen in love with King Billy's horse.
The pomp and glory of the state holds them in thrall, and the chance
to be near power, even if that power is just riding them toward
its own end, is too difficult to resist. Other people think they're
back in the mill: They have always had to labor away to provide
resources for the state, and they cannot conceive that there are
open fields and hilltops to roam.
think the state is a necessary evil? Well, which is it: Are you
in love with the horse King Billy sits on, or are you just stuck
on the treadmill?
Callahan [send him mail]
has just finished a book, Economics for Real People, to
be published this year by the Ludwig
von Mises Institute.
© 2001, Gene
Callahan/Stu Morgenstern Archives
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