Wednesday, December 27, 2017

Should Free Market Advocates Always Be in Favor of Tax Cuts?

At the post, The Sneaky Way Trump is Putting a Tax on Elitist Colleges, Douglas asked an important question:
You always say you are for every tax reduction. Does that include tax reductions that only increase govt borrowing? If not how do you propose politicians cut spending in a democracy where the public votes for its own benefits. Any one politician can go against spending, but he will not be reelected. What could anyone do to reduce spending?
This is a very important question and it was raised at last month's Circle Rothbard-San Francisco.

I see it as ass-backward libertarianism to argue against any freedom by trying to make the point that limiting a freedom will advance us toward freedom.

Murray Rothbard, as he almost always did in his writings, nailed it when he wrote:
Similarly, in this age of permanent federal deficits, we are all faced with the problem: should we agree to a tax cut, even though it may well mean an increase in the deficit? Conservatives, from their particular perspective of holding budget-balancing as a higher end, invariably oppose, or vote against, a tax cut which is not strictly accompanied by an equivalent or greater cut in government expenditures. But since taxation is an evil act of aggression, any failure to welcome a tax cut with alacrity undercuts and contradicts the libertarian goal. The time to oppose government expenditures is when the budget is being considered or voted upon, when the libertarian should call for drastic slashes in expenditures as well. Government activity must be reduced whenever and wherever it can; any opposition to a particular tax — or expenditure — cut is impermissible for it contradicts libertarian principles and the libertarian goal.


  1. Taxation is bad mmkay. It's amazing everyone debates the percentage the tax should be for certain groups (zero for all!) until they are blue in the face, but never discuss the more important question, how is taxation ethical? Taxation is accepted as normal now. Eliminate all income taxes! Starve the government and let it go bankrupt! Time for politicians to sleep on the street begging for money.

  2. When one group votes to lower their taxes, increase pilfered spending on themselves, and increase taxes on other groups, that's just democratic slavery. This is the one advantage of a flat tax; it keeps more people "with skin in the game". That way they have incentive to lower taxes rather than just adjust it away from them.

    Some of my left-leaning friends are having a shit-fit over the perception (real or fictional) that their taxes are now increasing. They've been calling for tax increases for literally decades -- even often saying "I'm happy to pay extra taxes for [insert fictional benefit here]". Clearly they are hypocrites. They really want taxes raised on other people.

    It's not as straightforward as saying "all tax cuts on anyone are good". Taxes are evil, and decreasing taxes on one group, but increasing them on another is still evil. It's a battle over who is enslaving whom, and a smaller and smaller group are being pilfered by a larger and larger group. It will not end well.

  3. Robert, the logical flaw you point out is also what underpins one of the arguments of those libertarians who argue against so-called "open borders." If I understand them correctly, they claim that we should not call for the state to cease restricting movement across borders until the state has first dismantled the welfare system and shored up the electoral system. Thus one state program provides intellectual support for another.

    1. How will importing 60 million from the 3rd world who have not read towards a new liberty bring us closer to a libertarian society?

    2. Even assuming your projections are correct, we have a larger problem than that: we have over 260 million adult citizens already living here now who have not read "For a New Liberty." Shouldn't we advocate for the state to expel them first?

    3. Yes 260 million is a problem. Has adding 60 million more since the 1960s improved us?

    4. I don't know the personal views of each immigrant who has come here since the 1960s. But most importantly, I don't know if you can say that any country's trend to greater statism is caused only by, primarily by, or even substantially by, immigrants vs. the cause we ought to attribute to the indigenous population. Certainly at other periods in US history big spikes in statism occurred (e.g., under Lincoln, Hoover and FDR) without an influx of immigrants from the Third World.

      In addition, if we assume that each child is likely to develop the views of his parents, each new child born to a citizen with anti-liberty beliefs is equivalent to the arrival of an unwanted immigrant. If you want to exclude immigrants, shouldn't you want to control childbearing by such citizens?

    5. Fair question. For a PPS to persist, it would be legitimate to expect a declaration of allegiance to PPS principles when a child becomes an adult. If no declaration then expulsion. Like the Amish.

  4. This blog has been consistently against Trump's tax cuts but then quotes Rothbard above approvingly.