Thursday, April 15, 2010

More Tax Day Musings

Oliver Wendell Holmes famously said: "I like paying taxes. With them I buy civilization."

Yeah, well, couple of problems here. First of all, civilization predates taxes, and certainly income taxes. Heck, in America we didn't have internal taxes at all from 1817 to 1862. How'd we buy civilization then? The income tax only became permanent in 1913 with the passage of the 16th Amendment. So Holmes is just wrong.

Of course, a modern welfare society is just too costly to run without taxes, so today we probably need them. But that leads me to the second problem. Suppose I said: "I like paying $100 to the local deli. With it I buy a ham sandwich for lunch." I enjoy the ham sandwich. It's a very tasty sandwich. But $100 is still too much to pay for it. Likewise, just because I enjoy the benefits of civilization doesn't mean I'm willing to overpay for it.

A separate question is whether we're actually overpaying. I think it's pretty obvious we are, but there's room for disagreement here. I will leave that for another blog.


  1. A modern Department of Defense is also too costly to run without contributions from the society which it protects, James. Let alone the best military in the world. Taxes are necessary; welfare programs are in many cases not.

    Civilization predates taxes? Just how did the Mesopotamians pay for those ziggurats and walls around their cities? I think taxation, in one form or another, is either a necessary precondition for civilization, or a necessary by-product of civilization.

    And just how DID the government run without any taxes between 1817 and 1862?

  2. Gary, I don't disagree, which is why I said that today we probably need taxes. But it isn't "civilization" that requires them.

    I don't know how the Mesopotamians in particular paid for their ziggurats, but a lot of ancient civilizations forced tribute from client kingdoms and employed slave labor. The pharoahs of Egypt levied taxes, though, so they are pretty ancient. But it's not clear to me that any of this means they are a requirement for civilization.

    The U.S. federal government paid for itself by a combination of tariffs and other external levies between 1817 and 1862, rather than internal taxes. (You might say this is just shifting the cost, which would be a fair enough point.)

  3. A civilization needs a stream of resources in order to run. This can be either external or internal. External would mean gathering its resources from outside, ie, conquest, raiding, tribute, enslavement, or tariffs like you said. Internal would mean the people who make up the civilization in question support the civilization. While in a simple commune, that could mean simply dividing labor between the members, in a large complex civilization, it means taxes of one form or another.

    External support of a civilization is morally questionable, and has other risks as well. This leaves internal taxation as the only practical solution. I'm not happy about it, and I have serious problems with the way our tax money is spent, but I don't question the need.

    So, taxation is pretty much necessary for civilization. Another thing I think is necessary for civilization is ethics, which all too often seems to be forgetten.