Toronto Passions

Income v. Consumption taxes

What is the best tax setup?

  • Both income and consumption taxes.

    Votes: 23 34.8%
  • Only income tax.

    Votes: 7 10.6%
  • Only consumption taxes.

    Votes: 36 54.5%

  • Total voters
    66

SilentLeviathan

I am better than you.
Oct 30, 2002
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As for the army, the Germans avoided invading Switzerland during World War II because Switzerland has a well-armed citizenry. Well-armed insurgents have repelled technically superior invaders as the Vietnamese repelled Americans and the Afghans repelled Soviets. As a US-led invasion looked imminent, Saddam Hussein distributed guns among the Iraqis. I think an army is more important for offensive activities of the state rather than defensive activities of the people.
Not really, German didn't invade Switzerland becuase of its tradition of neutrality. They invaded Scandanavia which has a long tradition of a citizen army and they and the Russians paid for that. Read up on the Winter War between the Finnish and the Soviet Union. The citizen army didn't dissuade the Soviets and Germans from invading Scandanavia but it did cause them a lot of "annoyance".
 

someone

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Jun 7, 2003
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It's inefficient becuase it requires too much duplication of services. Let's say ou have 5 police companies providing policing services to Toronto, that means for each "police division" you would require 5 police stations, 5 times the amount of police officers, 5 times the number of police cars, etc. You would also require 5 times the amount of government bureaucracy to deal with all the different companies. In the end, for essential services it's much simplier to establish a government run monopoly. The ultimate stateholders in all these services are the citizens so it makes sense to naturally let the government run these organizations.
A more straightforward argument is that some goods are what economists call “public goods”. One property of such goods is that you cannot exclude people who don’t pay from consuming the good. Hence, no one has an incentive to contribute. Nonetheless, I have always found that people who honestly believe that voluntary contributions would be able to fund government believe what they do they way a religious person believes in god. Facts don’t matter so there is not point in debating them.
Taxes are the admission price we pay for living in civilized society. The governenments runs these servcies as they are servcies that are to be provided to all citizen and residents regardless of whether or not they can afford it.
Given your handle, it seems to me that you should be the one arguing Markvee’s position. Lol. If you don’t see why I say this, you might want to google “Leviathan theory of government”.
 

SilentLeviathan

I am better than you.
Oct 30, 2002
909
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A more straightforward argument is that some goods are what economists call “public goods”. One property of such goods is that you cannot exclude people who don’t pay from consuming the good. Hence, no one has an incentive to contribute. Nonetheless, I have always found that people who honestly believe that voluntary contributions would be able to fund government believe what they do they way a religious person believes in god. Facts don’t matter so there is not point in debating them.
Yeah, I'd agree with that.

Given your handle, it seems to me that you should be the one arguing Markvee’s position. Lol. If you don’t see why I say this, you might want to google “Leviathan theory of government”.
Actually I just used the traditional forumla of ADJECTIVE + NOUN to generate my username. :)
 

markvee

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Mar 18, 2003
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It's inefficient becuase it requires too much duplication of services. Let's say ou have 5 police companies providing policing services to Toronto, that means for each "police division" you would require 5 police stations, 5 times the amount of police officers, 5 times the number of police cars, etc. You would also require 5 times the amount of government bureaucracy to deal with all the different companies. In the end, for essential services it's much simplier to establish a government run monopoly. The ultimate stateholders in all these services are the citizens so it makes sense to naturally let the government run these organizations.

Taxes are the admission price we pay for living in civilized society. The governenments runs these servcies as they are servcies that are to be provided to all citizen and residents regardless of whether or not they can afford it.
Why is duplication inefficient for security providers but not for cell phone providers? I think that a free market is capable of determining the most efficient number of competitors. I think it is the government forcefully suppressing competitors and forcefully collecting payment for its services that drives inefficiency.

I can voluntarily pay the admission price to a carnival. Why is the admission price to civilized society not volutnary?

The government must pay for the services it provides. If the government is less efficient than the free market then the total service package available from government is less than the same priced total service package available from the free market.

In terms of providing for who can not afford services, I think the government is also less efficient in the distribution of charity than free individuals who are not forced to part with some of the fruits of their labour.
 

markvee

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Not really, German didn't invade Switzerland becuase of its tradition of neutrality. They invaded Scandanavia which has a long tradition of a citizen army and they and the Russians paid for that. Read up on the Winter War between the Finnish and the Soviet Union. The citizen army didn't dissuade the Soviets and Germans from invading Scandanavia but it did cause them a lot of "annoyance".
I think that the Swiss have less cime and fewer invasions because of a well-armed citizenry. If the Germans would turn on an ally (Russia), I don't see why they would give more respect to a neutral country. In any case, you have agreed that a well-armed citizenry effectively annoyed invaders in the case of the Finnish. I have similarly used Viet Nam, Afghanistan, and Iraq as examples of the effectiveness of well armed citizens in mounting an insurgent defence.

I maintain that the state's army has more capability for abuse in terms of offensively invading outer countries than it has utility in mounting a defence within its own borders.
 

markvee

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A more straightforward argument is that some goods are what economists call “public goods”. One property of such goods is that you cannot exclude people who don’t pay from consuming the good. Hence, no one has an incentive to contribute. Nonetheless, I have always found that people who honestly believe that voluntary contributions would be able to fund government believe what they do they way a religious person believes in god. Facts don’t matter so there is not point in debating them.

Given your handle, it seems to me that you should be the one arguing Markvee’s position. Lol. If you don’t see why I say this, you might want to google “Leviathan theory of government”.
Again, based on my opinion that a free market is more efficient than a coercive monopoly, there are ultimately less total availability of public goods than there would be availability of the same goods under a free market. And I do not think that the government can more efficently conduct charity than free individuals.
 

landscaper

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as usual your hyperbole is wind from an orafice...economists from both the left and right have discounted this tax..only those who want simplistic solutuions to complex problems would advocate this tax...
Seems like you protest to much,

What is wrong with a flat tax for everybody with a bottom limit on lower income earners for example 20,000.00 as a bottom line if you make less than 20 grand you pay no taxes if you make over 20 grand you pay the flat tax . No deductions allowed period
 

SilentLeviathan

I am better than you.
Oct 30, 2002
909
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Why is duplication inefficient for security providers but not for cell phone providers? I think that a free market is capable of determining the most efficient number of competitors. I think it is the government forcefully suppressing competitors and forcefully collecting payment for its services that drives inefficiency.

I can voluntarily pay the admission price to a carnival. Why is the admission price to civilized society not volutnary?

The government must pay for the services it provides. If the government is less efficient than the free market then the total service package available from government is less than the same priced total service package available from the free market.

In terms of providing for who can not afford services, I think the government is also less efficient in the distribution of charity than free individuals who are not forced to part with some of the fruits of their labour.
Cell phones are not a necessary service and are much simplier to set up than a police startion.

The admission price to civilized society is voluntary. Nothing is stopping you from going out into the middle of the woods and building a log cabin and living off the land, or flying to Somalia and living in a society without a government.

It's not about delivering these services as efficiently as possible, it's about delivering them as effectively as possible. The government makes sure that everyone of their citizens can get access to water, electricity, police and fire services wherever they live. Private companies have no incentive to do so. Look at the various times people have complained that Rogers or Bell wants X amount of dollars to run cable or phone lines to their house. That's why in a lot of rural areas there's no cell phone coverage, it doesn't make financial sense.
 

SilentLeviathan

I am better than you.
Oct 30, 2002
909
0
16
I think that the Swiss have less cime and fewer invasions because of a well-armed citizenry. If the Germans would turn on an ally (Russia), I don't see why they would give more respect to a neutral country. In any case, you have agreed that a well-armed citizenry effectively annoyed invaders in the case of the Finnish. I have similarly used Viet Nam, Afghanistan, and Iraq as examples of the effectiveness of well armed citizens in mounting an insurgent defence.

I maintain that the state's army has more capability for abuse in terms of offensively invading outer countries than it has utility in mounting a defence within its own borders.
The Germans turned on Russia becuase Russia was Communist and is the enemy of Facism. It had more to do with ideology than Hitler's felings towrds treaties. Hitler stated true to Italy and Romania both of which were Facist allies. Vietnam, Afghanistan, and Iraq are different cases becuase you have an emeny that can blend in with the locals, different climate from what we're used to, and of course guerrilla warfare. Those three things make it very difficult to combat the enemy via traditional means.

There's also the isue of outside influences providing, logistical support, weapons, trainging, and troops in all those cases as well so it's simply not the "average Joe" fighting back.
 

SilentLeviathan

I am better than you.
Oct 30, 2002
909
0
16
Seems like you protest to much,

What is wrong with a flat tax for everybody with a bottom limit on lower income earners for example 20,000.00 as a bottom line if you make less than 20 grand you pay no taxes if you make over 20 grand you pay the flat tax . No deductions allowed period
That stil doesn't work becusae then the people who are earning just over $20,000 end up earning less than $20,000 after the tax.

The best solution is still the progressive tax rate at it distributes the tax burden among all levels of wage earners as opposed to lower income earners bearing the brunt.
 

markvee

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Mar 18, 2003
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Cell phones are not a necessary service and are much simplier to set up than a police startion

The admission price to civilized society is voluntary. Nothing is stopping you from going out into the middle of the woods and building a log cabin and living off the land, or flying to Somalia and living in a society without a government.

It's not about delivering these services as efficiently as possible, it's about delivering them as effectively as possible. The government makes sure that everyone of their citizens can get access to water, electricity, police and fire services wherever they live. Private companies have no incentive to do so. Look at the various times people have complained that Rogers or Bell wants X amount of dollars to run cable or phone lines to their house. That's why in a lot of rural areas there's no cell phone coverage, it doesn't make financial sense.
Food distribution is an essential service provided by a market more free than the one that provides policing. What is the test of which services are too complicated to be provided by a free market? I don't see what is complicated about people carrying weapons for their own protection.

When there was more unsettled land, people had the option to move to a more free location, as was the case with Europeans moving to the United States. But today, the state does not exclude secluded woodlands from its ownership, taxes, and regulations. The problem with Somalia, apart from the attention it gets from the interventionist foreign policies of competing empires, is that while it may have rid itself of the coercive monopoly of central government, its people are still subject to coercion by feuding warlords. With diminished prospects of moving to a more free place, I hope that people will make a stand for their freedom where they live. It may be natural for humans to seek to rule one another, but as a member of the ruled, I hope for a time of more freedom.

I would rather have a bigger pot of resources to divide without loss to government inefficiency and let the free market chose how to divide these resouces, free from government rationing.
 

markvee

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The Germans turned on Russia becuase Russia was Communist and is the enemy of Facism. It had more to do with ideology than Hitler's felings towrds treaties. Hitler stated true to Italy and Romania both of which were Facist allies. Vietnam, Afghanistan, and Iraq are different cases becuase you have an emeny that can blend in with the locals, different climate from what we're used to, and of course guerrilla warfare. Those three things make it very difficult to combat the enemy via traditional means.

There's also the isue of outside influences providing, logistical support, weapons, trainging, and troops in all those cases as well so it's simply not the "average Joe" fighting back.
None of this takes away from my point that a well armed citizenry mounts a better defence than a state army, which is more inclined to offensive activities of the state.
 

someone

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Again, based on my opinion that a free market is more efficient than a coercive monopoly, there are ultimately less total availability of public goods than there would be availability of the same goods under a free market. And I do not think that the government can more efficently conduct charity than free individuals.
Google the term “public good” before you make dump responses as you clearly have no understanding of the issue.
That stil doesn't work becusae then the people who are earning just over $20,000 end up earning less than $20,000 after the tax.
Mathematically it can definitely work. It is just a matter of defining your revenue requirement and setting the upfront deduction and tax rate at budget balancing levels. Whether or not people would want it is a different question.

The best solution is still the progressive tax rate at it distributes the tax burden among all levels of wage earners as opposed to lower income earners bearing the brunt.
Technically, a flat tax with an upfront deduction is a progressive tax by modern definitions. Back in the 1930s there was some debate on how the term should be used and bank then some economists thought it should refer to marginal tax rates. However, today almost all economists use it to refer to average tax rates. A flat tax with an upfront exemption does lead to increasing average tax rates (the upfront exemption is worth less as income increases) and hence is progressive by modern definitions of the phrase progressive tax. It may not be as progressive as you would like that is another issue.
The admission price to civilized society is voluntary. Nothing is stopping you from going out into the middle of the woods and building a log cabin and living off the land, or flying to Somalia and living in a society without a government.
Somalia may not have a traditional government but I am sure the war loads provide some of the functions of a traditional government in exchange for involuntary fees that amount to taxes. Pure anarchy is so rare I cannot think of any real examples that have lasted more than very short periods of time.

Also, even if you live in the Words you benefit from an Armed forces that keeps the borders secure.
 
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Peter123

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Apr 28, 2005
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a true believer...

You didn't answer my question, but I will try to answer yours. As I've stated previously, services are provided more efficiently in a competitive free market than under a monopoly of central planning. However, I am not a competitive free market; I am an individual, so I can at best speculate how the free market would answer a question, and my individual speculation may not amount to a better answer than another individual's central planning. With that caveat, I will attempt to speculate.

Fire departments are the easiest because individuals have organized themselves into voluntary fire departments without government intervention. In terms of a paid fire department, I don't see why there couldn't be competitive fire departments just as there are competing taxi companies that can be called.

As for the army, the Germans avoided invading Switzerland during World War II because Switzerland has a well-armed citizenry. Well-armed insurgents have repelled technically superior invaders as the Vietnamese repelled Americans and the Afghans repelled Soviets. As a US-led invasion looked imminent, Saddam Hussein distributed guns among the Iraqis. I think an army is more important for offensive activities of the state rather than defensive activities of the people.

Why can't individuals openly carry a gun for their self defence, as police do? I think the reason is that the primary function of the police is to protect and serve the state rather than the people, and unequal rights to self defence facilitate their job as law enforcement officers for the state. I think that there are still some police who favour being peace officers rather than law enforcers, but I think that this is an individual choice rather than one promoted by the state. Also, police have replaced highwaymen, acting as mobile tax collectors in their police cruisers with their ticket quotas. If you call for police while under attack then you will have to wait for them to arrive, and they will not engage the aggressor until it is safe for them to do so, regardless of the consequences to you. I think that you are best served arming yourself or employing a security agency whose contract with you is unclouded by a law enforcement mandate.

Private prisons already exist, so it is not difficult to imagine how they might be run, but the real question is how justice would be administered under free market system. There would be no universal laws against things such as drug use or bawdy houses, but there still would be property rights and voluntary contracts, so there would need to be a mechanism to settle cases of assault, murder, theft, property damage, and contract violations. The best that I can offer is that people would obtain their arbitrators on the free market as they do everything else, and people who do not abide by arbitration would develop poor justice histories akin to poor credit histories that would impede future ability to violate others’ property.

As for roads, individuals would maintain roads on their own property, as already happens in parts of cottage country, but highways are more complicated. I can see them being taken over by toll companies that would charge a usage fee to cover maintenance. It would be difficult to build competing highways because the land would need to be purchased from voluntary sellers. The government can more readily build highways by expropriating the land, but is the ease of obtaining the land for highways worth the cost of loss of property rights? Under government, people do not really own their land. They pay rent (property taxes) to government and can lose their stewardship of land to government at any time through expropriation. The government can even expropriate land from one individual and then turn around and sell the land to another individual, as was done with the commercial properties around Dundas Square in Toronto.
WOW...while I don't agree with any of it (and don't believe for a moment it could work..receipt for anarchy--no prisons?)...got to admit you do certainly sound like a true believer!! Read Ayn Rand much?
 
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james t kirk

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Aug 17, 2001
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Everybody thinks that THEY are paying TOO MUCH tax and the other guy is paying too little. THEY think that THEY would bennefit if tax laws were changed because THE OTHER GUY would have to pay more and they would pay less.

Ba ha ha.

The bottom line is that the gov't needs X dollars per year. The value of X is not going to change anytime soon. So whether you pay by one tax or another is irrelevent because in theory, you need to pay the same. So it's a wash.


BTW, I read an article recently that stated that the top 1% of wage earners pay fully 22% of all taxes collected in the country. (Think about that.) And the top 50% of wage earners pay 98% of all income taxes in the country. (Think about that.)
 

Peter123

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Does matter as taxes are not all distributed evenly..some are progressive, some are regressive and others are even more regressive....so yeah even if you assume a zero sum game---how you do it does matter

For example--property taxes are quite regressive...so someone like me--high income, low property value gets off quite easy---whereas all those land rich widows get screwed...
 

markvee

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markvee said:
Again, based on my opinion that a free market is more efficient than a coercive monopoly, there are ultimately less total availability of public goods than there would be availability of the same goods under a free market. And I do not think that the government can more efficently conduct charity than free individuals.
Google the term “public good” before you make dump responses as you clearly have no understanding of the issue.
I won't return insults as a form of counter-argument, but I have tried to find an economist to reference regarding the point I was trying to make.

Exerpts from an essay on public goods by Hans-Hermann Hoppe: http://www.vforvoluntary.com/wiki/PublicGoods

Definition of public goods:
"Certain goods or services, and among them, security, are said to have the special characteristic that their enjoyment cannot be restricted to those persons who have actually financed their production. Rather, people who have not participated in their financing can draw benefits from them, too. Such goods are called public goods or services (as opposed to private goods or services, which exclusively benefit those people who actually paid for them). And it is due to this special feature of public goods, it is argued, that markets cannot produce them, or at least not in sufficient quantity or quality, and hence compensatory state action is required."

So called public goods that have been provided privately:
"… historical evidence shows us that all of the alleged public goods which states now provide had at some time in the past actually been provided by private entrepreneurs or even today are so provided in one country or another. For example, the postal service was once private almost everywhere; streets were privately financed and still are sometimes; even the beloved lighthouses were originally the result of private enterprise; private police forces, detectives, and arbitrators exist; and help for the sick, the poor, the elderly, orphans, and widows has been a traditional field for private charity organizations. To say, then, that such things cannot be produced by a pure market system is falsified by experience one hundredfold."

Why public goods are a waste of resources:
"Since money or other resources must be withdrawn from possible alternative uses to finance the supposedly desirable public goods, the only relevant and appropriate question is whether or not these alternative uses to which the money could be put (that is, the private goods which could have been acquired but now cannot be bought because the money is being spent on public goods instead) are more valuable—more urgent—than the public goods. And the answer to this question is perfectly clear. In terms of consumer evaluations, however high its absolute level might be, the value of the public goods is relatively lower than that of the competing private goods, because if one had left the choice to the consumers (and had not forced one alternative upon them), they evidently would have preferred spending their money differently (otherwise no force would have been necessary). This proves beyond any doubt that the resources used for the provision of public goods are wasted, as they provide consumers with goods or services which at best are only of secondary importance."
 

someone

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Markvee, clearly Hans-Hermann Hoppe knows little more about these issues that you do if he thinks the post office is a public good. Likewise with his other examples. I suggested that you google the term “public good” to try to learn something about the concept. Clearly, you are not a good judge of sources (hell even Wikipedia would have been better). I would take the time to educate you if I had not wasted far too much time doing so in the past. You have your beliefs and I have facts. Sort of like the difference between a religious person and a non religious person. By all means keep your beliefs. However, if you ever do decide to educate yourself, there are plenty of sources you could start here http://en.wikipedia.org/wiki/Public_good. If you decide not to, that is your business.
 

Peter123

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Apr 28, 2005
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World without public goods

Imagine a world with public goods/services...

You wake up in the morning in your house, better hope it is all OK, because of course their are no building codes and no building inspectors to make sure they are ok when build. You go to have your shower--oh no, the company you hired to supply you water had a main break down the street and the neighbour whose land it is under won't come to terms with your water company to allow them access to the pipes to fix it.

Wander downstairs for breakfast, get your food ready but you ponder how safe the food is, after all there is no government authority to regulate the food industry. You did get horribly sick once so you exercised your property rights and sued the big food company, of course with the inbalance in you resources you got crushed in court. A court that you had to pay a substantial fee to bring a lawsuit in front of. You always wondered whether the corporations paying significant retainer fees to the courts has any influence on how they make their decisions?

Well get dressed and hop in the car...man the drive to work is expensive as you electronic toll negotiator blimps everytime you enter the property of each landholder along your path. Some of the stretches are getting very hard to negotiate since their owners have really neglected the upkeep of those stretches. The intersections where the owners can't come to terms on right of way are quite dangerous.

But speaking of danger, the roaming bands of thieves, rapists and murders are quite troublesome. You are quite angry that although you have signed up for an annual prison retainer fee very few of the other people have so there is nowhere for people convicted to go. Course there are very few people convicted these days, what with the cost to the victim of pursuing a criminal trial through the private court system. Of course you can then sue the criminal for the cost through the private civil courts---surprisingly very few of the criminals end up having the money to reimburse the cost of the trial or the financial settlements order for infringement of your property rights to your body, property and rights.

Oh well, you manage to get your job. You hear the company is unilaterally changing the work conditions again. You do miss the days when you had some sense that your workplace was safe, but at least their are no interfering government bureaucrats meddling in the affairs in your company. And you feel comfort in knowing if you are killed on the worksite your heirs can sue the company for compensation, but oh yeah again that problem of the inbalance in the court system

Well maybe better killed than seriously injured--then you really would have problems. The very high costs of completely private health system really worry you and course there is no support for you if you have no income for any period.

You ponder taking a vacation some day. But the airports have all shut down since the airspace all become private property over each individual piece of land, there was really no way to negotiate fees for millions of acres the planes fly over. Well with no regulation, inspection and rules the planes started to have serious rate of crashing anyway. Maybe a get away to just the local mountains--very expensive drive but you need it. Then you remember your buddy who went hiking but suffered a fall. You understand he passed away while talking on his cell phone negotiating with the different search and rescue companies to get one of them to come to his aid at a price he could afford.

Oh well back home. Man there is a lot of garbage around! Sure there are plenty of private garbage pickup firms, but surprisingly many of your neighbours haven't signed up with any and just leave the garbage laying around. None better fall on your property or you will sue! Oh oh...what's this bad cough you are developing? What with the garbage piles and the open sewers (your area couldn't find a new company to install a new one after the last company failed and people want to much to dig under their property.) you have heard that the Black Plague has returned. Too bad there is no public health anymore to track and fight off these such things. Well at least as you begin to slip away into the "big sleep" you feel comfort in knowing that old, antiquated, inefficient ideas of government, taxes and public goods was abolished...
 

JohnLarue

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Jan 19, 2005
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Why must government services be paid for by coerced payment (taxes) rather than by voluntary payment?

Logic tells me that services are provided more efficiently under competition than they are under monopoly.
Logic tells me that if you make it voluntary for me, I will not pay & neither will most others.

I do not like the monopoly aspect of the service delivery as that has lead to wasteful spending and fat-cat unions gouging the public purse while they are protected from competition
I think we should open up more services to competition

However, voluntary remittance of taxes, just plain will not work
Thats pie in the sky thinking, ignores human nature / behaviors and is not practical
 
Ashley Madison
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