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Taxes: Government Financing In A Free Society

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Charles, no one imagines that tomorrow we can deregulate everything and close every inappropriate government institution. Instead, we need to operate on the principle that LFC is the ideal (an achievable one), and the basis on which we make our politico-economic decisions.

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I haven't read this entire thread but it seems like people believe that private donations will be the only (or even the main) source of government funding. I've been toying with the idea of "charging the bad guys," that is, making criminals pay for their apprehension and imprisonment, making enemy governments pay for the cost of going to war with them, and making the loser of court cases pay the court costs. Those three cover police, military, and courts, respectively.

Of course, there may be occaisons where the "bad guy" cannot pay, in which case other funding methods can be employed. The Speichers brought up the fact that this often happens in civil cases, so a capitalist government may offer voluntary contract insurance to cover that possibility. At any rate, I think "charging the bad guys" could cover a substantial portion of the costs of running a government.

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They require simply, "OMG, if I don't pay to have this contract/patent/copyright/what-have-you secured, and this guy sells me out, I'm TOTALLY SCREWED!"  or "Blank stole $200,000 from me and the courts can't prosecute the case unless I forward $750 bucks!  Here's the court fees get me my $200,000 back!"

Ok...anyone that would break a contract will go out of business since most people don't like that kind of service, and if very many people think that they can make more money by stealing X amount one time than continuing their business then LFC most likely won't be able to work in such an irrational invironment anyway.

Court fees are obviously good and make a lot of sense, but are you going to overcharge people that can afford it so that a working class man who gets falsely accused of a crime can also get his justice.

Patents and copyrights are also rational money raising options, but are you going to pay for an army with the money you raise.

I have raised other concerns with the contracts and lotteries that have been largely ignored with an exception or two...

Once there, however, "the problem of funding" is a non-problem because the government would be so small and the existence of insanely productive men so large that funding the government would be like me funding a lemonade stand. You notably wonder why no one in the literature has provided as extensive a solution as you demand and the answer is simple: The problem is irrelevant. More often than not this "problem" is used to show the "nonviability" of LFC.

Rest assured, when the time comes for LFC, the tenner of the men present at that time will be such that it will hardly be necessary to coax or provide "a convincing case" as to why funding their own protection is in their self-interest.

Yes rational people will most likely also have less need for government contract backing, and have little interest in "making" money through a lottery system.

If anyone wants to argue about the viability of the funding ideas they have presented please do, but if not why doesn't anyone just say that at the time when people are capable of sustaining LFC they will also gladly support the necessary functions of government through donations? It sounds like Felipe means that, but no one really seems to be outright saying that donations will be a, or the, viable way to finance a government.

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.. a rational society requires a 100% reserve gold standard, and that is inflation-proof by both definitions: government cannot manufacture new and additional money, because it is constitutionally forbidden from owning gold mines, and the rate of expansion of the supply of gold does not exceed the rate of expansion of the supply of gold (see Reisman, Capitalism).

I have moved the posts on gold-standard/fractional reserve etc., adding them to a previous thread (link to first moved post)) that discussed the issue in quite some depth.

Edited by softwareNerd

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I think we can better understand the issue of financing a LFC government by looking at some numbers.

Miss Rand suggested financing the government by charging a fee based on the value of contracts, which businesses would pay to gain access to the courts. Is such a system feasible?

In 2005, the Federal government will spend $2,479, 404,000,000. (That is 2.479 trillion dollars. Source: Office of Management and Budget website) In addition, in 2005 the 50 state governments are expected to spend $1,735,196,370,000. (That is 1.735 trillion dollars. Source: Rockefeller Institute of Government’s Fiscal Studies Center) So, total government spending for 2005 is $4,214,600,370,000.

Gross Domestic Product for 2005 is estimated to be $12,220,000,000,000. (12.22 trillion dollars). Thus, at present total government spending is consuming 34.5% of GDP, a horrendous burden that obviously demands coercive taxation.

However, let us examine the spending for the valid functions of government, which Objectivism holds to be national defense, police and the courts.

Here are the 2005 spending estimates for what I consider the valid government functions. (Source is the same as the totals.)

2005 Federal Spending on Valid Functions

National Defense $465.871 billion

(All branches of the military plus CIA, NSA, etc.)

Veterans Benefits $67.649 billion

(Pensions and health care for retired military)

Justice Department $40.657 billion

(Includes the FBI, Federal courts, Federal Judges, etc)

General Government $19.117 billion

(Costs of the national Legislative, Executive and Judicial Branches, etc)

Sub-Total $593.294 billion

2005 State Spending on Valid Functions

Law Enforcement $54.687 billion

(State patrol, local/city police, county sheriffs, etc)

Courts & Corrections $64.492 billion

Total Valid Spending $712.473 billion

% of GDP 5.83%

A very different picture! Spending for the valid functions of government is only 5.83% of GDP.

Thus, a fee of 6% on all commercial transactions in the United States would pay the entire cost of government under LFC. (Granted, this is a bit of an expansion on Miss Rand’s initial idea, since the entire Gross Domestic Product is not produced under contract. However, virtually every business that contributes to GDP does at least some contract work and needs the valid functions of government. More on this in a moment.)

Please note that this is very much a worst-case analysis. There is a great deal of waste and improper spending at present even in these “valid” functions. For instance, under LFC we would not spend the billions of dollars we’ve wasted keeping our troops in Bosnia for the last decade, we probably would not spend billions a year to keep armored divisions in Germany and we sure as heck would not spend billions a year enforcing drug laws. So the total cost of a proper government is undoubtedly even smaller than the numbers above.

This is a worst-case analysis in another sense as well. Freed of the current mass of government regulations, rules, restrictions and taxes, Gross Domestic Product would be much higher.

So we can say with confidence that the 6% figure is a maximum. The real fee is likely to be considerably lower, provided everyone agrees to pay.

But would everyone in business agree to pay? Almost everyone would. Here is why:

1) First, a 6% fee is a very small burden compared to the current burden of sales taxes, profit taxes, dividend taxes, social security taxes, unemployment insurance taxes and workmen’s compensation taxes – just to name a few of the financial burdens that governments currently impose on businesses.

2) Second, a transaction fee is very simple from an accounting standpoint. Everyone in business keeps track of revenue.

3) As others have pointed out, contracts that cannot be enforced through the courts are worthless; and almost every business conducts a least a few transactions under contracts. What business is going to give up the ability to have those contracts enforced?

4) Even transactions that are not done under an explicit contract are commonly done under the implicit contract of credit. For instance, when I purchase raw materials for my business, I issue a purchase order, but I do not have to pay for the material for 30 days. Likewise, when I ship my product, I send an invoice to my customer, but he does not have to pay me for thirty days.

This wonderful system of credit works because all participants know that there is recourse against those who default on their debts: the courts. Again, what business is going to forgo access to the courts just to save a 6% fee?

5) Many purchases involve warranties and performance guarantees. Without access to the courts, these are also useless. Who is going to buy a $1 million dollar machine tool with no recourse against the seller if the machine does not work? What business will be willing to purchase raw materials if there is no recourse against receiving poor quality material?

6) Many industries such as pharmaceuticals and electronics are heavily dependent on patent protection. None of these businesses is going to give the right to protect its patents in court.

7) Refusing to pay the 6% would mean surrendering all legal protection against con men and grafters of all sort.

8) How many investors will buy the stock of companies that have given up access to the courts? Darn few.

9) Of course, any individual who wishes to avoid paying the 6% fee could simply buy only from companies that are not adding the fee to their price. But how many such businesses will there be? Not many, for all of the reasons above.

But doesn’t this scheme force business to pay the entire cost of government? Actually, no. In most cases, the business will simply add the fee to the price of their product. Thus, who is paying for the cost of government? Everyone who purchases from any business, which means virtually everyone. No free riders!

I believe the numbers make it clear that financing the government under LFC will not be difficult – once we get government stripped down to its valid functions.

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The 6% fee on all commercial transactions sounds a lot like a 6% sales tax, and your pass the fee on to the consumer sounds a lot like how the current sales tax system works.

I also think that, just like today, most transactions will be carried out without the need for a legally binding contract. In LFC, defaulting on an agreement will be just as much business suicide as it is now.

Thank you for the stats!!! They were really great and well researched.

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The 6% fee on all commercial transactions sounds a lot like a 6% sales tax, and your pass the fee on to the consumer sounds a lot like how the current sales tax system works.

I think it was suggested that the commercial transactions would be those transactions based on a contract. Which includes the use of credit. That's huge amounts of money right there.

I also think that, just like today, most transactions will be carried out without the need for a legally binding contract.  In LFC, defaulting on an agreement will be just as much business suicide as it is now.

Thank you for the stats!!!  They were really great and well researched.

Suicide or not, I would imagine that businesses would like to be able to seek damages from the courts!

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I think it was suggested that the commercial transactions would be those transactions based on a contract. Which includes the use of credit. That's huge amounts of money right there.

A 6% fee for the use of credit, on top of interest rates, still sounds a lot like a tax to me. The cost would be pushed off on the consumer (obviously), which looks a lot like the way the current sales tax works, who would then probably be hit up for another 6% if they used a credit card, or even possibly a check.

Suicide or not, I would imagine that businesses would like to be able to seek damages from the courts!

Does anyone have stats on how many contract disputes are settled in court versus out of court? I've heard that the out of court method is norm today, and in a future with people who have higher moral standards than today I'm sure this would continue, but I don't have exact numbers.

Is there even any guarantee that a privately run contract insurance agency wouldn't pop up to compete with the government? I just have a hard time believing that the government could compete in a situation like that unless the tilted the odds in their favor through legislation, which seems less than moral.

Basically my objection to the various government self funding scenarios is this: Governments have historically shown themselves to be inefficient and unable to compete against the private sector, so how will the government succeed in funding itself without stooping to coersion, like the current tax scheme or by creating a monopoly by law for themselves in some market? I don't think that a government can exist on its own, but that it needs some external source of sustenance to keep it alive.

I do however think that rational businessmen and citizens would be willing to donate to the government to pay for protection in the form of the army and policeforce, and that the court system may be able to sustain itself through court fees.

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A 6% fee for the use of credit, on top of interest rates, still sounds a lot like a tax to me.  The cost would be pushed off on the consumer (obviously), which looks a lot like the way the current sales tax works, who would then probably be hit up for another 6% if they used a credit card, or even possibly a check. 

Does anyone have stats on how many contract disputes are settled in court versus out of court?  I've heard that the out of court method is norm today, and in a future with people who have higher moral standards than today I'm sure this would continue, but I don't have exact numbers.

Only a small percentage of contracts are ever disputed, and, yes, many of those disputes are settled out of court.

However, maintaining access to the courts is rather like the decision to purchase fire insurance. Industrial fires are relatively rare, yet the great majority of businesses purchase fire insurance. The reason is that when a fire does occur, the monetary damage can be large. Fire insurance is a cheap way of eliminating this risk of loss.

Similarly, a company may experience a contract dispute no more than once a year, but can involve lots of money if not successfully resolved. This is why I believe the great majority of businesses will pay a (relatively small) transaction fee on all of their transactions – it’s like purchasing fire insurance.

Disputes are possible over any transaction, even those not covered by an explicit contract. This is why we have a body of law called the Uniform Commercial Code. The UCC defines the rights and obligations of buyers, sellers and various third parties in a whole host of situations. The UCC covers: General Provisions including definitions of terms, applicability and statutes of limitations, Sales, Commercial Paper, Bank Deposits and Collections, Letters of Credit, Bulk Transfers, Warehouse Receipts, Bills of Lading and other documents of title, Investment Securities, Secured Transactions, Sales of Accounts, Implicit Contract Rights and Chattel Paper, Effective Dates and Repealers. It is 111 pages long.

I mention this just to illustrate that the business world is quite complex. The opportunities for disputes are numerous. Sooner or later, most businesses need the courts.

I realize a transaction fee sounds a lot like a sales tax. But it would be voluntary, not coercive. Only those who wish to maintain access to the legal system – which I do think will be the overwhelming majority of businesses – will have to pay the fee. And remember: it will eliminate a whole host of taxes currently imposed on businesses.

Is there even any guarantee that a privately run contract insurance agency wouldn't pop up to compete with the government?  I just have a hard time believing that the government could compete in a situation like that unless the tilted the odds in their favor through legislation, which seems less than moral.
There are, in fact, private arbitration firms in existence now. I have signed contracts that include the stipulation that all disputes must first go through such arbitration.

However, government has a power that no private company can ever have: the power to use force to settle a dispute. This includes the power to issue subpoenas and warrants for purposes of uncovering evidence needed to settle a dispute. It includes the power to seize the assets of a defaulting company, to force performance to the terms of an agreement, etc.

Even the most rational of businessmen can have disputes that can only be settled through the power of government.

Basically my objection to the various government self funding scenarios is this:  Governments have historically shown themselves to be inefficient and unable to compete against the private sector, so how will the government succeed in funding itself without stooping to coercion, like the current tax scheme or by creating a monopoly by law for themselves in some market?
The monopoly that government must have, according to Objectivism, is a monopoly on the use of force. Thus government will never have to compete with any private firm for the role of final arbiter.

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I see potential coercion coming in to play when you are required to buy the right to your rights. Which is what the 6% contract fee sounds like. You aren't for paying court fees or anything else that is tangible. Instead, as businessmen, you are paying the entire tab of the government so that when and if your rights get violated, your rights will actually be recognized. This seems to differ significantly from, say, fire insurance, because no one has a right that protects them from accidents or lightning or whatever caused the fire. If I own a lawn gnome and it gets struck by lightning I have no right to another lawn gnome.

Could someone that broke an uninsured contract still be tried in criminal court? This all looks like buying justice, and I'm really uncomfortable with that idea. Something is either right or it is wrong, and whether or not you pay a fee doesn't change that.

The whole problem I see with fees and such is that the only thing the government should be allowed to do is protect people's rights, and any system where you have to pay extra to get your rights recognized appears coercive to me. I think that the only way a government should be funded is on a donation basis, and I also think that the slimmed down government Aisa outlined could very well be funded by the donations of a rational society.

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This all looks like buying justice, and I'm really uncomfortable with that idea.  Something is either right or it is wrong, and whether or not you pay a fee doesn't change that.
Even justice has to be "bought" (a.k.a. paid for). The term "buying justice" is usually used in the sense of bribing judges etc. --- i.e. it really means "buying injustice".

The idea of paying a fee when a contract is drawn up is a really old one. Many countries have the system in place. A common way it is practiced is through the use of "stamp paper". Many governments issue paper that has an emblem and a monetary value (usually on the top) with the rest of the page blank. When a contract is ready to be signed, the parties will purchase the "proper" denomination of stamp paper. The maximum amount they can claim is often limited by the denomination of stamp-paper they buy. The final contract will then be typed and signed on the stamp-paper. [in a different context, the stamp tax was what the British tried to extend to the U.S.]

Often the law will not require stamp paper to press any claim. However, the claimable amount might be limited by whether stamp paper was used and of what denomination. One could envisage a system where not having paid the fee "up front" does not limit even this, but instead results in a far higher "court fee".

The bottom line is that someone has to pay. To the extent such fees can be made to fall upon the people who are being protected, the better.

If I had to guess, I'd say that voluntary donations would form the bulk of the finances of a LFC country.

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I am not sure the government could provide arbitration cheaper than the market. Private arbitration is one of the fastest growing industries in the US, and I would guess that in a free market, it would be even bigger. Now I know you will reply that the private arbitraters do not have the power to enforce a contract like the government does, but private arbitraters don't have that power now, yet they still handle more cases than our court system ever sees, because our courts are slow, and inefficient. And if you had to pay a "service fee" on top of the govt courts being slow and inefficient, my guess is that no one would use them, that didn't have to because of the severe risk of the contract (and its need for enforcement).

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I see potential coercion coming in to play when you are required to buy the right to your rights.

I've only skimmed these posts, but who is suggesting forcing people to buy contract insurance? AisA stated: "I realize a transaction fee sounds a lot like a sales tax. But it would be voluntary, not coercive."

You may choose to buy contract insurance if you wish, so that if someone defaults on the contract they signed with you, you may file a civil suit against them. You can do this even without such insurance, but you'd have to pay the court fees.

I discussed this topic with the Speichers here:

Sales Tax Justification?

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I am not sure the government could provide arbitration cheaper than the market. Private arbitration is one of the fastest growing industries in the US, and I would guess that in a free market, it would be even bigger. Now I know you will reply that the private arbitraters do not have the power to enforce a contract like the government does, but private arbitraters don't have that power now, yet they still handle more cases than our court system ever sees, because our courts are slow, and inefficient. And if you had to pay a "service fee" on top of the govt courts being slow and inefficient, my guess is that no one would use them, that didn't have to because of the severe risk of the contract (and its need for enforcement).

I know something about private arbitration and it can be a useful alternative to actually going to court in some situations. On the other hand, it has certain drawbacks as well.

The rulings of private arbitrators are enforceable by the government because the parties agree (through contract) to abide by the arbitrator's opinion before entering the process. In the current system, the state enforces the arbitrator's ruling.

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I am not sure the government could provide arbitration cheaper than the market.

I have not argued that it could.

Private arbitration is one of the fastest growing industries in the US, and I would guess that in a free market, it would be even bigger. Now I know you will reply that the private arbitraters do not have the power to enforce a contract like the government does, but private arbitraters don't have that power now, yet they still handle more cases than our court system ever sees, because our courts are slow, and inefficient.
Private arbitration works because the participants know that if they refuse to accept the arbiter's verdict -- after having contractually agreed to do so -- the government courts stand ready to force compliance.

And if you had to pay a "service fee" on top of the govt courts being slow and inefficient, my guess is that no one would use them, that didn't have to because of the severe risk of the contract (and its need for enforcement).

So what are you advocating? Is it your intent to argue that there does not need to be a final arbiter in society, that we do not need a government with a monopoly on force? If so, please answer one question. What happens -- in the absence of government -- when someone refuses to abide by a private arbiter's decision?

I have listed numerous reasons why the existence of a court system and a final arbiter for disputes is of enormous importance to business in America. You seem to neither refute nor acknowledge the reasons I have given. Why?

Furthermore, you seem to be ignoring the point that I have made repeatedly: that a 6% transaction fee -- which Oaks correctly identifies is voluntary and itself constitutes a donation -- is a far lower burden that the taxes currently imposed on businesses, taxes which would vanish under LFC. Is it your position that businesses prefer the much higher tax burden they currently face?

Let's take a look at the current tax burden on businesses.

We’ll take a company whose product sells for $1, whose labor cost to produce that product is 25 cents, and whose pre-tax profit is 10 cents. Those are fairly common percentages.

Nationally, state sales tax averages about 4%. So, for each $1 of product sold, 4 cents in taxes are paid.

All dollars expended on labor are taxed for social security, Medicare, workman’s compensation and unemployment insurance. These vary from state to state, but the average total is about 30%. So for 25 cents in labor, the business pays an additional 7.5 cents in taxes for these items.

Profits are taxed at 28%. So, an additional 2.8 cents in taxes is paid on the profit.

Dividends paid from that profit are taxed at 15%. So when that profit is paid to the shareholders in dividends, the company will pay an additional 1.5 cents in taxes.

So the total tax burden is as follows:

Sales tax ……………………………… 4 cents

Social security, Medicare

Workman’s compensation &

Unemployment Insurance……………… 7.5 cents

Profit tax ………………………………… 2.8 cents

Dividend Tax …………………………… 1.5 cents

Total: …………………………………… 15.8 cents per dollar, or 15.8%

For every dollar in revenue, a company is typically paying 15.8 percent in taxes.

Now, if you read my previous post, you will see that there is good reason to consider the 6% transaction fee a worst-case scenario. The actual percentage will likely be less. But in any case, a 6% fee beats the heck out of 15.8%.

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You may choose to buy contract insurance if you wish, so that if someone defaults on the contract they signed with you, you may file a civil suit against them. You can do this even without such insurance, but you'd have to pay the court fees.

Now this makes sense to me, and is something that I can wrap my morals around, so to speak. If what you are buying is protection against having to pay court fees then I see it as completely moral. An excellent analogy to fire insurance can now be made because we have no right to demand completely free justice since that would be demanding someone to labor for us at no cost.

The problem I was airing before was based my not understanding that the courts would still be open to you at the price of court fees if you didn't pay the contract fee. I was unknowingly fighting a straw man.

Now, if you read my previous post, you will see that there is good reason to consider the 6% transaction fee a worst-case scenario. The actual percentage will likely be less. But in any case, a 6% fee beats the heck out of 15.8%.

I can see how contract fees can be handled morally now, but if they couldn't be then the fact that someone is stealing less money from me than before wouldn't make it any more moral.

Often the law will not require stamp paper to press any claim. However, the claimable amount might be limited by whether stamp paper was used and of what denomination. One could envisage a system where not having paid the fee "up front" does not limit even this, but instead results in a far higher "court fee".

Limiting the amount that could be claimed would still deny someone the right to justice because they didn't pay for their right upfront.

The paying of court fees when you don't pay the contract fee still says that you have a right to justice, but that you don't have a right to make other people work for free in order to provide your justice. I think that in a system like this that most if not all businesses would simply pay the contract fees, but without another option you run into the problem of denying rights.

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Limiting the amount that could be claimed would still deny someone the right to justice because they didn't pay for their right upfront. 

In principle, if the law lays down a set of reasonable rules... if it says that contracting parties should follow those rules to get certain protections... if it accomodates emergency situations where "post-facto compliance" may be the only practical approach....

Then, how can someone claim that the law is unfair when that person failed to follow the rational rules?

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I think we can better understand the issue of financing a LFC government by looking at some numbers...

Thank you! I consider myself an Objectivist-in-training. I don't understand the philosophy well enough yet to be an Objectivist, but am learning. This website is great reading.

Your post about funding government through contractual fees is great! It makes so much sense. I'd like to add my take on this idea, as I've read your post.

As I see it, every individual within the society would have the basic government protections: military, police, courts (criminal and civil), and I might toss in fire department. No individual would pay any direct taxes for any of these. Any individual could sue or be sued in the courts, call the police (or fire department), and have a military providing a national defense. It would be no different than today, except that there would be no taxes -- to the individual.

Businesses would operate slightly differently. All businesses would also be protected by the military, police (and fire department), and be subject to criminal court action. The difference would lie solely within how businesses would be treated in the civil courts.

Each business would have a voluntary choice: access to civil court or not. Access would include as a plaintiff and as a defendant. No business that did not volunteer would be able to bring any civil suit in any court for any reason. They could engage in contracts that settle disputes in arbitration. However, if the other party refused to pay, the plaintiff would have a worthless arbitration victory. It would need access to the civil courts to enforce its victory.

Also, any individual or participant business could file a lawsuit in the civil courts against any business in society. If the defendant business was a nonparticipant, then it would automatically lose in a summary judgement. Any judgement would be fully enforceable against it. So, in order to protect against being drained of its money through frivolous lawsuits, if nothing else, it would volunteer to participate.

In effect, we would all have 6% added to everything we buy, except for private party transactions. There would be no other taxes. No income, FICA, property, sales, gasoline or other taxes. This single tax would pay for all the legitimate functions of government, at all levels. It is irrelevant that it is for the purpose of access to the courts by businesses that the funds are used to pay for the military. It is just one tax for everything, which also makes it easy for everyone to see what the cost of government actually is.

It's a great idea. One thing going for it is that it is easy to explain to non-Objectivists. Those who agree that government should be smaller can find agreement with this idea. I think it opens the debate to a larger audience and gives people with concerns of how society would function under LFC a clear picture of how it could be done. It's important to have practical, concrete answers to other people's abstract concerns.

It solves many concerns people have. What would poor people do? Nothing. What about fire or police? Just call 'em up. Why would anyone volunteer to pay this? Only businesses would volunteer and would do so to protect their own best interests.

Thanks for the idea.

I have a question on your numbers: Of the $12 trillion in GDP, do you have an estimate of what percentage of that is "big business" versus everyone else? Maybe Fortune 500 or some other classification could be used to identify how much of this figure is from very large businesses that would absolutely -- without exception -- pay the fee/tax.

Thanks.

~ zynner

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Property taxes are even less rational than many of the others, which are all immoral.  Just think about it.

I did some research on this issue, and it seems that after the crash of '29, part of FDR's "New Deal" was the putting up of all of America's private assets to pay the national debt to foreign nations. If this is enumerated in foreign treaties, then the government can claim control over all private property, citing the treaty obligations to signatory nations.

The truth is slowly emerging now that we buy a title to 'exclusive use' of land, but we do not own the land. We pay rent in the form of taxes. The hundreds of thousands we might have paid for the land itself is just a title fee.

This country has misled the people long ago, about any right to property that we may have had. Now the ugly truth is slowly emerging and the current generation is being 'educated' to embrace Fascism at its finest.

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I did some research on this issue, and it seems that after the crash of '29, part of FDR's "New Deal" was the putting up of all of America's private assets to pay the national debt to foreign nations. If this is enumerated in foreign treaties, then the government can claim control over all private property, citing the treaty obligations to signatory nations.

The truth is slowly emerging now that we buy a title to 'exclusive use' of land, but we do not own the land. We pay rent in the form of taxes. The hundreds of thousands we might have paid for the land itself is just a title fee.

This country has misled the people long ago, about any right to property that we may have had. Now the ugly truth is slowly emerging and the current generation is being 'educated' to embrace Fascism at its finest.

Even treaties are subject to the US Constitution, or at least SHOULD be.

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.......The truth is slowly emerging now that we buy a title to 'exclusive use' of land, but we do not own the land. We pay rent in the form of taxes. The hundreds of thousands we might have paid for the land itself is just a title fee.

Believe me, the moment you buy your first house, this lesson is driven home loud and clear. As a kid, I thought my parents "owned" our family home. Hardly. If you don't pay your rent to the state in the form of property taxes, they'll take it away in a heartbeat. I feel sick every six months when I write a very substantial check to the state of MI for the privilege of living in a house I only thought I owned. Adding insult to injury; if you improve your property, they increase the assessment and you have to pay more rent. :D

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To answer your question about "big" versus "small" business: From the US House of Representatives Small Business Committee:

Small businesses play an important part in the United States economy. There are about 22.4 million non-farm firms in the U.S, according to 2001 data. Small businesses represent more than 99 percent of all employers. They also employ 51 percent of private-sector workers, 51 percent of workers on public assistance, and 38 percent of workers in high-tech jobs. Small businesses account for nearly all of the self-employed, which comprise of 7 percent of the work force.

In addition, small businesses produce two-thirds to three-quarters of all the net new jobs. They also produce 51 percent of private sector output as well as represent 96 percent of all exporters of goods.

Also:

Small Business Share In GDP

The private non-farm sector share of the GDP (Gross Domestic Product) fell slightly to 50 percent from 51 percent from 1992 to 1997. This is not unusual though, because it has been fairly stable over the past two decades while only fluctuating slightly. Also, preliminary data shows an increase of that 50 percent share to 52 percent in 1998 and 1999. This is only a preliminary estimate however, as not all data has been compiled in the latest available reports.

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If you don't pay your rent to the state in the form of property taxes, they'll take it away in a heartbeat.
It's somewhat worse than rent. With rent, there is a known amount that you have to pay and a regular time when you have to pay it. With property taxes, you can't know in advance what the rent is, or when it is due, and they have no obligation to even notify you what you owe (I have been trying for years now to get them to actually send us a tax statement and still every year I have to call them up and ask them to tell me the amount). Our neighbor almost lost their house because they didn't pay close attention to their unannounced obligation.

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This country has misled the people long ago, about any right to property that we may have had. Now the ugly truth is slowly emerging and the current generation is being 'educated' to embrace Fascism at its finest.

Have you read Ominous Parallels? This is the Weimar Republic, only instead of one up-and-coming dicator (Hitler) we have a million (government officials).

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Thank you!  I consider myself an Objectivist-in-training.  I don't understand the philosophy well enough yet to be an Objectivist, but am learning.  This website is great reading.

Your post about funding government through contractual fees is great!  It makes so much sense.  I'd like to add my take on this idea, as I've read your post.

~ zynner

Zynner:

I agree with your post entirely. You have done a far better job of articulating the idea than I did. Thanks!

And welcome to the Forum. There are many highly intelligent people here. I have learned a great deal through my participation.

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