Liberty and the State: Can Tax-Man-Voting Tame the Tiger?

The strategy outlined here deals with transforming state according to well-established values like democracy and justice into a society with a threefold voting procedure: The man-vote (one man, one vote) applies to all issues that are not property-invasive or property-dependent. The tax-vote (one dollar, one vote) applies to all subjects concerning taxation and expenditure. And third, a meta-decider-institution, provisionally named u201Cconstitutional filteru201D is constituted by few members, every single one elected by double tax- and man-vote-majority to decide for each concern to be decided upon: Does it need man-vote majority, tax-vote majority or double man- and tax-vote majority? This mechanism prevents a structural majority of redistribution-winners, putatively or factually, and turns whatever remainder of public sector into a consensually driven enterprise.

In general public post-world-war opinion the question whether or not state is a u201Cnatural conditionu201D has not even arisen. It is simply felt to be there like the air we breathe although it feels quite different to healthy breathing, perhaps more like an asthmatic attack. In contrast, within the libertarian world it is widely agreed that policy and hence welfare-warfare state [1] rather is the problem than being the solution to problems.

Following the Austrian School of Economy, Hans-Hermann Hoppe [2] like many before stated that the cardinal sin of classical liberalism was the acknowledgment of the state as an enforcer of property rights. In his 1927 treatise Liberalismus [3] Ludwig von Mises found the central fallacy of liberalism in the wrong consequence from the right assumption: The need for compulsive action against intruders of foreign property rights does not mean that this is the unequalled and original business of government. [4] In contrary it has been shown that this job can not be effectively done by government as the territorial monopolist of (positive) legislation and taxation, the so-called expropriating property protector. [5] Thus it must be said that this widely accepted fallacy of liberalism perpetrates its own deterioration and that the hegemony of socialism and democracy as tyranny of the morally hazarded majority basically is an intellectual failure. Otherwise it is difficult to understand why libertarianism failed to take over opinion leadership after worldwide bankruptcy of hard-core socialism by the end of the past century.

So what? On the one hand libertarians agree in disapproval of most of the traditional fields of u201Cpublic services,u201D but on the other hand there is still no clear line to be seen whether state eo ipso is a model to be of potential benefit to a free society. [6] Irrespective of Rothbard’s statement, that u201Cin a truly free society, where individual rights of person and property are maintained, the state, then, would necessarily cease to exist,u201D [7] it is still true that there is no established hegemony of anarcho-capitalism, let alone a realistic strategy to implement those ideas into democratic reality. So willy nilly we'll have to deal with the u201Cmonopolist of crime,u201D as Albert J. Nock [8] put it, for one more decade or century, before he loses the majority support, the essential prerequisite of its very existence. [9]

Strategies proposed to surmount the state in favour of a free society are manifold, some of them being education, private (gold-) money, secession and constitutional limitation of power. Let me face the latter.

It seems to be a widely consensual opinion, based on historic apperception that every effort to constitutionally limit state activity to providing justice and safety failed and cannot but fail, since power to prevent evil at the same time must be coercive power over free individuals and the monopolist of taxation and decision-making will overcome any legal limit by its power of interpretation. [10] And Rothbard may have been too optimistic in concluding u201CThe wry coupling of the twin certainties in the popular motto u201Cdeath and taxesu201D demonstrates that the public has resigned itself to the existence of the State as an evil but inescapable force of nature.u201D [11] For the increase of wealth experienced in daily life obviously has created a cognitive disaster in most minds, at least an obstinate misinterpretation by being associated with democracy and wise policy of social engineering rather than with its true conditions like progress of technology managed by what is left of capitalism and Greenspam-policy [12] at the same time. So despite taxation the state isn't even widely regarded as a torment.

Perhaps the most profound reason for common belief in the need for a (democratic) state is the same as for the belief in some sort of a personal creator behind all that immense complexity of the physical world and can be addressed as atavistic regression, a withdrawal into pre-enlightenment states of consciousness. Development of space and species by physical order and natural selection of accidental mutations respectively is a process grossly exceeding one's personal experience in time as well as in capacity of observation, at the same time requiring a reflection in mind due to their massive impact in real life experience. Very much alike is the u201Cinvisible handu201D of spontaneous social order an instrument far too complex to be sensually understood and u201Cbelieved.u201D It seems to be more appropriate for human experience to think of some big brother or father or king or honourable committee of experts rather than of an abstract order to regulate what one cannot retrace. Mises finds u201Cthe belief that the rulers are wiser and loftier than their subjectsu201D u201Cat the bottom of all totalitarian doctrines.u201D [13]

Being a layman in history, economy as well as in philosophy I cannot sort out ideas discussed or refuted so far. In contrast to Rothbard [14] it seems to me that there is – in theory – a way to institutionally limit state activity and thus maybe find a closer way to more general acceptance of libertarian ideas by avoiding resisting prejudices.

Given the necessity of common decision-making the democratic principle of ruling by majority of electors is only legitimate where it does not conflict with property rights of citizens. This may be the case when choosing the colours of the national flag. In addition it is valid if only the universally held and unalienable property right of ones own body is concerned. As long as states exist, this might involve foreign affairs, alliances and terms of freedom of contract insofar as they really have to be established uniformly.

These and other conceivable limitations to legitimate majority-ruling originate in the fact that the democratic procedure itself is intrinsically immoral. [15] Hence the concept presented here has lost innocence from the very beginning; this may on the one hand be an essential precondition of public acceptance, on the other hand be balanced by the third level of meta-decision described below.

As long as the state exists taxes must be raised from alienable property to enable minimal activities. According to preservation of property rights, the number of electors, in particular the number of potential tax-consumers has to be neglected in this decision process. Instead the weight of the vote results from the amount of taxes and voluntary donations paid over the preceding period. Let us call this the tax-vote (one dollar, one vote) as opposed to the man-vote (one man, one vote). Paying taxes does not necessarily mean to unconditionally transfer titles; instead it means to invest in an enterprise that has to be performed consensually.

This construction of letting the tax-payer decide upon taxation and expenditure hereby financed prevents majority-power to reduce its own burden of taxes at the cost of the minority, for then, in the next period, the minority's power of votes would prevail and turn things around again. The objection that the richest could be exploited by a broad middle income class by progressive tax rates just being flat enough to prevent the tax-vote majority of the super-affluent [16] are not really convincing, at least as long as taxing competition between more than one unified world-state prevents confiscatory taxation.

A tricky question would be whether or not some sort of minimal social welfare is necessary and possible in this donor-oriented model without initiating the well-known moral downward-helix with ballooning redistribution and without abolishment of personal responsibility. Furthermore no measure of government could be made when interfering with a poll of direct democracy on the subject. Maybe studying Switzerland, the oldest direct democracy, could be beneficial in this concern.

The pivotal question is: Whatever the concern of whomsoever may be, directed to whichsoever public institution, there must be a constitutional filter to decide upon the way of decision-making. Decision upon deciding may be called meta-decision. The subject in question is to be decided either by majority of man-votes or majority of tax-votes or by majority of both man-votes and tax-votes, corresponding to its nature of potentially being property-invasive and / or property-dependant concerning alienable property and / or unalienable property. So this constitutional filter has to separate the realm of traditional democracy from the sphere of taxation and disbursement. Predominance of this institution could safely be prevented by direct election of say one third of the members at a time for short periods, requiring both man-vote and tax-vote majority for each single candidate.

This u201Ctax-man-votingu201D constitution with its central and historically unprecedented institution of a meta-decider, the constitutional filter would well match the virtue of democracy without perverting ethics by having two wolves and one lamb discussing the next meal, as Benjamin Franklin put it.

Does this sound utopian? Yes, compared to humans landing on some neighbouring planet some day. But compared to social justice in redistribution of abundance of miraculously originated goods? After having experienced worldwide failure of this concept, the interested public should be well prepared to hear about concepts in accordance with natural law and ethics of liberty, because it is about a combination of the well-established virtues liberty, democracy and justice. Unfortunately it must be said that Rothbard’s optimism [17] remained unfulfilled so far. His analysis of long-term indications for a free society is obviously right, but his optimistic short-term analysis seems to fail to realize that the enemy is not sleeping. How deeply, virtually inextinguishably statism [18] and belief in u201Csocial justiceu201D are embedded at least in German minds has been trenchantly shown by Roland Baader. [19] In complete contrast to expectations, breakdown of Eastern-German collectivism has in no way evoked a renaissance of ideas of liberty. And even if one concedes that liberty has never been a German word, it sure is an Anglo-American one, in current time being perverted by New Labour's u201Cspin doctors.u201D The same phenomenon of permanence of the socialistic paradigm can be seen in Eastern Europe where socialistic governments result from free elections.

The limiting factor then in a strategy towards liberty is the subjective condition of public consciousness. So I presume that changing the constitution of state is high enough an obstacle for a change of paradigm towards free society. Abolition of state, sweet as it sounds to libertarian ears, may be too much of an imposition on general public opinion. And since state constituted as outlined here, wouldn't be much of what it is today – except the golden calves u201Cstateu201D and u201Cdemocracyu201D have been taken care of – this speculation can bear the blame of gradualism in theory as being perpetuity in practice, as William Lloyd Garrison [20] stated in demand of abolition of slavery.

The challenge is an intellectual one.

Does u201Ctax-man-votingu201D sound more utopian than having gold coins in the wallet or secession of every other small community from the given state or hearing the government just saying goodbye to society by enlightenment? Who knows. Maybe it's the combination of all that by and by – or yet after global economic breakdown? [21] – makes the race.


[1] u201CWelfare-warfare state, empirically speaking, is a unified beast.u201D Erich Mattei, Michael Moore and Freedom.

[2] Hans-Hermann Hoppe, Democracy, the God that Failed (in German, Waltrop: Manuskriptum, 2003), p. 417 ff.

[3] Ludwig von Mises, Liberalismus (Jena: Fischer, 1927 / Sankt Augustin: Academia, 1993) p. 33

[4] In demarcating liberalism from etatism and anarchy he 17 years later stresses to our surprise: u201CWith human nature as it is, the state is a necessary and indispensable institution.u201D Ludwig von Mises, Omnipotent Government. The Rise of the Total State and Total War (Yale University Press, 1944 / Grove City: Libertarian Press), p. 49

[5] Hans-Hermann Hoppe, Democracy, the God that Failed (in German), p. 178

[6] Even Hoppe cannot quite do without thinking of some public structure like state or communities, when he states, that an immigrant to let's say Switzerland has to compensate for existing major investments like hospitals and schools. Hans-Hermann Hoppe, Radio Interview Philipp Dru.

[7] Murray N. Rothbard, The Ethics of Liberty (New York University Press, 2002), p. 173

[8] Albert Jay Nock, On Doing the Right Thing, and Other Essays (New York: Harper and Brothers, 1928), p. 143, quoted in Murray N. Rothbard The Ethics of Liberty p. 173

[9] Hans-Hermann Hoppe, Democracy, the God that Failed (in German), p. 487

[10] Hans-Hermann Hoppe, Democracy, the God that Failed (in German), p. 426,

[11] Murray N. Rothbard, The Ethics of Liberty p. 175

[12] Mark Thornton, Housing: Too Good to be True, (Mises Daily Articles June 4, 2004)

[13] Ludwig von Mises, Omnipotent Government. The Rise of the Total State and Total War p. xi

[14] Murray N. Rothbard, The Ethics of Liberty p. 176

[15] Hans-Hermann Hoppe, Personal communication August 28, 2004

[16] Hans-Hermann Hoppe, Personal communication August 28, 2004

[17] Murray N. Rothbard, The Ethics of Liberty p. 269

[18] Mises prefers the French-derived term u201Cetatism,u201D clearly expressing the fact that etatism did not originate in the Anglo-Saxon countries and has only lately (1944! (year and emphasis added)) got hold of the Anglo-Saxon mind. Ludwig von Mises, Omnipotent Government. The Rise of the Total State and Total War p. 5

[19] Roland Baader Chalk for the Wolf – the Deadly Illusion of Defeated Socialism (in German) (Boeblingen, Anita Tykve Verlag, 1991)

[20] Quoted in Murray N. Rothbard, The Ethics of Liberty, p. 260

[21] Roland Baader, Money, Gold and God-Actors (in German) (Graefeling, Verlag Dr. Ingo Resch, 2004)

February 8, 2005