Thursday, May 13, 2004

When everyone is in need of help
Alan Reynolds suggests a clever way to reduce the tax-burden:
I have discovered a foolproof strategy for beating the income tax, the Social Security tax and the Medicare tax: Lower your income.
Although not a very original idea, it's still fun to see it written out so clearly.

In many peoples mind, the government has a role when it comes to helping those who cannot work themselves or are suddenly faced with great difficulties of some sort, e.g. get a possible deadly disease which needs expensive treatment, or simply go broke. In order to finance this role, the government taxes those who work, saying it's "for their own best". I mean, we don't want diseases to kill of the poor or the poor to live in a society where they cannot educate themselves! But giving the government a role in providing everyone with a "fair chance" in life is a dangereous move, to say the least!

Most people don't need government support. They can afford to pay insurance, put aside money for hard times, own a house and a car, have good food on their tables and warm clothes on their shoulders and can take a nice summer-vacation. Most people in "free" economies are middle- and upper-class, although their livestyles vary greatly with income. Although the Left argues that income-inequality is bad in itself, this point should kindly be ignored. What is bad however, is how the poor are doing, and if they can afford to take time off, go to school or get health-care.

But the government shouldn't have a part to play in helping the poor with their basic needs of any sort. The European social-democrats will argue that if the government doesn't provide for somekind of support, then no-one will. Taxing the working people heavily, and distributing the tax-income to various institutions, is in their mind the only way to "make sure" the poor can go to school and see a doctor.

This arguement has not proven correct. The government, however well-intended the politicians are, will not succed in this role. The government has time and time again proven that it will tax the working people only to create institutions that require more and more money to do less and less. This hurts the poor the most because their lives are already a thin line between food and no food, or education and health care and no such thing. The government will at some point have created a system which will make everyone needy for government support, and only a few evil "rich people" are said to be on their own. A family with good income made by people with good education, living in a big house, and owning two cars, will at some point have to seek to the government for help. When 40% of their income has been sliced away and all government-run services made 50% more expensive than they are in the hands of private entrepreneurs, they will need support when they have children, when they use the roads, when they owe money and when they need to see a doctor. In Iceland, even buying a piece of lamb-meat or a liter of milk is an action which the government has interfered with. By its role as a helper, the government has made sure that everyone is really in need for help.

Why is this the case? Why is this tolerated? For that I have no good answers really. I'm not sure if I would protest against government-action in helping those who need help if it only showed a slidest sign of doing its function well. But like with any operation which is free of competition and consumer-feedback, the government does not. I can't say, "hey you government-people, start helping my poor neighbour or else!", but instead must watch a good portion of my salary go into a system that may, but probably wont, give help to those who need it.

Therefore, I call myself a libertarian. Therefore, I have the energy to fight government-run welfare- and support-programs in any way I can.

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