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Taxes: Government Financing In A Free Society

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Wouldn't the insurance company need to use enforceable contracts too?

I think the premiums for the government’s enforcement of contract would be much lower than insurance company’s, and the insurance companies themselves would have to use enforceable contracts. The advantage to having insurance is that it will cover your loss regardless. I don’t think the system would involve the government acting as an insurance company; the government wouldn’t give you money from its own funds if someone broke a contract, the government would make the person who owes you money pay or if he can’t put him in jail. Anyways, correct me if I'm wrong.

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Sure, the insurance company couldn't strictly 'enforce' a contract, but it could offer insurance, couldn't it?

Yes; but I don't really understand what you're describing. You can (and should) have a private binding arbitration clause in your contract (and even if it's not in your contract, both parties ought to agree to submit to binding arbitration). That contract (between the parties and the arbitration firm) will then be enforced by the courts. The original parties don't ever (or hardly ever... if somebody knows of a counterexample, I wanna cover my rear) call upon the courts to determine that the contract is enforceable. That's what the laywers are for. Assuming there is a dispute, the judgment can be made by binding arbitration, which is private; if then somebody doesn't want to obey this second agreement, then the courts can invoke force (assuming that the arbitration was done properly).

The only two ways that I can imagine insurance being relevant would be to get insurance against loss due to judgments against you, and also in the amount of the judgment they was awarded to you but not collected. Of course, you can also get litigation insurance that covers the cost of the procedings.

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There's a difference between insurance and enforcement. Private companies can compete to sell insurance; only government can provide enforcement.

I have some issues with the contract fee idea. First, why should you have to pay a fee to have your rights protected? If that model is valid, why not also charge a fee for police protection and the military? If you did not pay you would not get the protection. Note that for the military at least this idea would not work, since the military protects the country as a whole, not individuals separately.

More importantly, though, if government charges a fee for contract enforcement that is only partly used for that enforcement and partly for police, military, etc, then it is unfair to the people paying the fee. Essentially everyone else becomes a free rider on those heavily involved in contract-making (presumably mostly businesses.) I can see the possibility of only a small part of the fee being actually used for contract enforcement, especially in time of war. What happen when those businesses decide to use voluntary binding arbitration instead of paying the fee? (something that is already common in business contracts)

I would suggest instead a flat annual voluntary contribution paid by every adult. There would be no official punishment for not paying, but the names of nonpayers would be published and payers could choose to "punish" nonpayers by refusing to deal with them in any way.

One advantage of this idea is that excessive government spending would be somewhat self-regulating. The more people felt that the requested contribution was too high, the more would refuse to pay it or pay less and the less nonpayers would be "punished."

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I have some issues with the contract fee idea. First, why should you have to pay a fee to have your rights protected? If that model is valid, why not also charge a fee for police protection and the military? If you did not pay you would not get the protection.

Godless Capitalist has identified some serious problems with the idea of financing government through contract insurance/enforcement.

The most fundamental flaw in the "voluntary" contract insurance fee is that it is not really voluntary. If non-payment of a fee results loss of ability to recover one's property, then one is paying the fee under duress. For example, if I contract with a company to install a new furnace in my home and the company keeps my down payment but refuses to give me the furnace, my right to recover my payment is not altered by the fact that the furnace contract was not insured. If the government refuses to pursue enforcement and forbids me to pursue it by other means, then government is effectively shielding the thief from justice. Government is not the source of rights, and cannot dispense rights or withhold them on the basis of who pays it money.

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[Mod's note: Merged with an earlier thread on taxes. - sN]

Government Financing:

Ayn Rand said that Government Financing in a free society would be voluntary.

Wouldn't that enable a few rich people who have become rich through crooked means to have private armies which might be equal or even more powerful than the government?

Wouldn't the mafia and terrorists be more difficult to defeat as the amount of funds the government receives will drop substantially?

Edited by softwareNerd

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Ayn Rand said that Government Financing in a free society would be voluntary.

Wouldn't that enable a few rich people who have become rich through crooked means to have private armies which might be equal or even more powerful than the government?

Wouldn't the mafia and terrorists be more difficult to defeat as the amount of funds the government receives will drop substantially?

No. Why would it?

If you were asking, "Couldn't a person with vast wealth conceivably find unscrupulous people who would be willing to do many evil things for money, and even take over a country and maintain control for some time", the answer would be yes. But that is so obvious that it's an unworthy question to even bother typing out, much less expending the wrist-effort needed to click "post".. So you must be implying something else. How about rephrasing the question without the implicit anti-capitalist and anti-freedom innuendi, and either ask a literal request for information, if you really are asking a question, or else make a straightforward claim that X has bad result Y.

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Raising private armies is the kind of thing rich people do where government is either irredeemably corrupt or simply vacant: and anarchy reigns.

It is impossible to achieve values by means of force. Rich people have put a premium on rationality. That's usually how they get rich.

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Ayn Rand said that Government Financing in a free society would be voluntary.

Wouldn't that enable a few rich people who have become rich through crooked means to have private armies which might be equal or even more powerful than the government?

Wouldn't the mafia and terrorists be more difficult to defeat as the amount of funds the government receives will drop substantially?

Here again, Tommyedison asks a perfectly reasonable question and gets a sneering, accusatory response for his efforts.

But to answer the question, yes, it is possible that wealthy people will finance private armies to protect their own interests. They certainly have in the past. In Germany, Italy and Spain fascist militias arose in response to the threat of a Bolshevik-style revolution. These para-military groups were supported by wealthy donors who believed (correctly, I think) that there was a real possibility that what happened in Russia in 1917 would be repeated in Western Europe.

The rich nowadays prefer to operate by stealth. Rather than launch a frontal assault on the state, they find it easier just to buy politicians to do their bidding.

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No. Why would it?

If you were asking, "Couldn't a person with vast wealth conceivably find unscrupulous people who would be willing to do many evil things for money, and even take over a country and maintain control for some time", the answer would be yes. But that is so obvious that it's an unworthy question to even bother typing out, much less expending the wrist-effort needed to click "post".. So you must be implying something else. How about rephrasing the question without the implicit anti-capitalist and anti-freedom innuendi, and either ask a literal request for information, if you really are asking a question, or else make a straightforward claim that X has bad result Y.

First of all, I am 100% pro-capitalist and pro-freedom.

I am asking, that in that case, how will the government deal with the threat with just voluntary financing.

I know that it would be in the people's self-interest to keep the government in proper condition but then we don't live in a utopia. The majority of the people are irrational and want to think only about the immediate future, not their long term self-interest.

And it is not a lifeboat situation. There are many unscrupulous sharks in the world.

It is impossible to achieve values by means of force. Rich people have put a premium on rationality. That's usually how they get rich.

The mafia doesn't get rich by reason or honesty, nor people like the executives of the Enron Scandal or people like Osama Bin Laden.

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I know that it would be in the people's self-interest to keep the government in proper condition but then we don't live in a utopia. The majority of the people are irrational and want to think only about the immediate future, not their long term self-interest.

I think this is the key. A free society first requires that the majority of people be rational and understand and accept the values of a free society. You can't just parachute the mechanisms of a free society onto people who don't understand or value it and expect it to work. (for references, see Afghanistan and Iraq)

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I think this is the key. A free society first requires that the majority of people be rational and understand and accept the values of a free society. You can't just parachute the mechanisms of a free society onto people who don't understand or value it and expect it to work. (for references, see Afghanistan and Iraq)

Exactly, no society will succeed if the majority of its members are irrational. For those who *are* rational, as the threats to their freedom increases, so does their willingness to fund the institution that will protect them--government.

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Ayn Rand said that Government Financing in a free society would be voluntary.

Wouldn't that enable a few rich people who have become rich through crooked means to have private armies which might be equal or even more powerful than the government?

Wouldn't the mafia and terrorists be more difficult to defeat as the amount of funds the government receives will drop substantially?

So you have problems letting a rich person control an army, because it might be used irresposibly? Why dont you have the same complaint against a government raising an army? It is not as if government has never used an army for "crooked means."

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So you have problems letting a rich person control an army, because it might be used irresposibly? Why dont you have the same complaint against a government raising an army? It is not as if government has never used an army for "crooked means."

That would promote anarchism.

Ayn Rand very well explained why anarchism was dangerous.

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That would promote anarchism.

Ayn Rand very well explained why anarchism was dangerous.

Given that we have just emerged from the century of the Total State, a period of unparalleled government butchery, I share Nimble’s healthy skepticism of armies ready to do the bidding of big government. Let us recall what Founding Father George Mason said, "I ask, sir, what is the militia? It is the whole people, except for a few public officials." We should not mistakenly assume that a military organization that is not under the direct command of the central government can do no good. In fact, independent militias were seen by the Founders as a bulwark against tyranny. In the 18th century the militia was typically led by a wealthy landowner, who often personally financed the purchase of arms and uniforms.

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That would promote anarchism.

Ayn Rand very well explained why anarchism was dangerous.

I dont see how private protection encourages anarchy? Do you think that malls should not be allowed to hire private security? Or that banks should not be able to have armed gaurds?

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I dont see how private protection encourages anarchy? Do you think that malls should not be allowed to hire private security? Or that banks should not be able to have armed gaurds?

I presume that first sentence was a statement and not a question? You should go back to the original quote that Tommy replied to:

So you have problems letting a rich person control an army, because it might be used irresposibly? Why dont you have the same complaint against a government raising an army? It is not as if government has never used an army for "crooked means."

Is your claim that private armies are completely indistinguishable from security guards? That's the only reason I can think of for you interchanging "private protection" and "private army" freely. Your argument reduces to the claim that since government can act improperly, government has no function. Do you really believe that?

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I presume that first sentence was a statement and not a question? You should go back to the original quote that Tommy replied to:

Is your claim that private armies are completely indistinguishable from security guards? That's the only reason I can think of for you interchanging "private protection" and "private army" freely. Your argument reduces to the claim that since government can act improperly, government has no function. Do you really believe that?

No, but I intended to point out that his claim was hypocritical. He claims that because private protection can be used for evil means,, it should not be legal. All I asked is, why not complain about government for the same reason? Government armies have a legitimate purpose, and so do private protection agencies.

And as for the indistinguishability of security guards and armies, the only difference is the number of "troops/guards" you own. And I dont think anyone can draw a distinguishing line.

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I have thought about this issue and have come up with a possible solution.

A government needs proper financing to function properly. In a utopia, it will get it. But we don't live in a utopia.

As the government is a servant to the people, can't it introduce a sort of package deal?

If you want police protection (protection from robbers, murderers, etc.), you have to pay for army protection too. Most people will pay for it here whether they are intelligent or mediocre.

Do you think this could work?

No, but I intended to point out that his claim was hypocritical. He claims that because private protection can be used for evil means,, it should not be legal. All I asked is, why not complain about government for the same reason? Government armies have a legitimate purpose, and so do private protection agencies.

And as for the indistinguishability of security guards and armies, the only difference is the number of "troops/guards" you own. And I dont think anyone can draw a distinguishing line.

My claim is not hypocrital. I have never said that private protection should be illegal.

Private Protection is different from owning armies.

An army is a large number of fighting men which can be used in case of self-defense or pre-emptive strike.

Private Security can only be used after somebody has attempted to attack or attacked a person, not before. And the number of private security guards can never be 50000 unlike the army.

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I have thought about this issue and have come up with a possible solution.

A government needs proper financing to function properly. In a utopia, it will get it. But we don't live in a utopia.

As the government is a servant to the people, can't it introduce a sort of package deal?

If you want police protection (protection from robbers, murderers, etc.), you have to pay for army protection too. Most people will pay for it here whether they are intelligent or mediocre.

Do you think this could work?

My claim is not hypocrital. I have never said that private protection should be illegal.

Private Protection is different from owning armies.

An army is a large number of fighting men which can be used in case of self-defense or pre-emptive strike.

Private Security can only be used after somebody has attempted to attack or attacked a person, not before. And the number of private security guards can never be 50000 unlike the army.

I believe that we do get a package deal, when you donate for a government. So, yes it can work.

As for your comment directed at me, how did you draw the line of 50,000 men? And when you say "An army is a large number of fighting men which can be used in case of self-defense or pre-emptive strike." That is a bad definition. NO AMRY government or personal has the right to pre-emptively strike. NO ONE has the right to initiate the use of force.

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As for your comment directed at me, how did you draw the line of 50,000 men?

By 50000 men, I wanted to show that an army consists of a large number of men. I wasn't drawing a line.

And when you say "An army is a large number of fighting men which can be used in case of self-defense or pre-emptive strike." That is a bad definition. NO AMRY government or personal has the right to pre-emptively strike. NO ONE has the right to initiate the use of force.

You mean to say that if US attacks Iran today to destroy its threat, it would be wrong and immoral?

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You mean to say that if US attacks Iran today to destroy its threat, it would be wrong and immoral?

YES! Every collectivist government is a potential threat to the US and its freedoms. Should we go around killing all the country's men, women and children who may or may not be affiliated idealogically with their government simply because they live in some geographical area?

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"Pre-emptive strike" is the name for the use of retaliatory physical force in response to the threat of initiation of force.

Everyone and his just government has the right to pre-emptively strike.

I understand where you are coming from, where there is no overt use of force, yet the threat is there. Like when a man holds a gun to you, he hasnt pulled the trigger, but you have a right to defense. However, I think full out war is a poor choice in most cases. I would prefer using special ops to stop these threats.

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Should we go around killing all the country's men, women and children who may or may not be affiliated idealogically with their government simply because they live in some geographical area?

Morally, we would have the right. And not "simply" because they live in a geographic area, but because those people "living in that geogrpahic area" are not suficiently resisting the government. They are sanctioning the evil through their inaction. They failed and their failure is now a threat to us. So we will respond in the way that is least harmful to our own citizenry. If (and that's a BIG if) that means nuking/carpet bombing them all, then that's what it means. We have no moral responsibility to sacrifice our lives to save those who are sanctioning evil. And so long as ANY strategy is more risky to even a single American life than nuking them would be, then that is precisely what we are doing: sacrificing ourselves.

So long as such a strategy (nuking) is clearly known by the world, I think no one would mess with us.

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Morally, we would have the right. And not "simply" because they live in a geographic area, but because those people "living in that geogrpahic area" are not suficiently resisting the government. They are sanctioning the evil through their inaction. They failed and their failure is now a threat to us. So we will respond in the way that is least harmful to our own citizenry. If (and that's a BIG if) that means nuking/carpet bombing them all, then that's what it means. We have no moral responsibility to sacrifice our lives to save those who are sanctioning evil.

So long as such a strategy is clearly known by the world, I think no one would mess with us.

Do you agree with the majority of stances the US takes on issues?

How to handle schools? How to handle the economy? How to handle foreign relations? Yet, do you sanction "the evil"? Yes! But some of us choose to work within the system to improve things for the better.

Now imagine you are under a regime that rules by force and fear. What options do you really have? I think its better to take out leaders and officials through covert ops, rather than full out war.

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