Narrow Government

Something we get entirely too accustomed to is the pervasiveness with which the government peers into our lives to satisfy its taxation policy. I think of the government as a mafia goon, lurking in the shadows, looking for any racket he can find.

"Did you get a pay raise? I'm gonna need a cut of that."

"Did you sell something? I'm gonna need my share."

"Did you improve your property? That's gonna cost you in taxes."

"Did you invest in something? Let me know if you come out ahead so I can dip into that."

Under the wide-ranging tax policies of our various levels of government, there are vanishingly few activities we can engage in which the government does not have some sort of oversight. Because of the taxation policy, you have to let the government know if engage in perfectly innocuous behavior, like lending a friend money. Because of the tax policy, a New Yorker can end up dead in a police van for the sin of selling cigarettes on the street.

The reason government intrusion is so pervasive is that they do everything they can to spread themselves thin. If the government took all its dues at once on tax day, the country would revolt overnight. Instead, they take it here and there. A small chunk out of each paycheck. A bit every time you make a transaction. A hidden excise every time you purchase fuel. And on and on. The cumulative effective tax rate in some areas now exceeds fifty percent. If government agents knocked on doors every April 15 demanding people write a check for the majority of what they'd earned that year, I suspect even our most liberal friends would be tempted to engage in armed anti-government standoffs. Instead, the people get bled by a thousand cuts, with no firm target to direct their angst.

As we debate the various tax strategies available to us, we should keep in mind the following principle, which is invariably true: the government will become intrusive, even tyrannical, within the domains it is given license. By reaction, we should seek to limit not the depth of government, but its width. The government will inevitably grow deep roots wherever it is planted, and we will be frustrated in our attempts to prevent it. Instead, we should look to narrow the scope of government; to limit the tyranny to some more manageable area.

This blog promotes a tax policy that extends from Energy-Backed Currency. The tax policy implied by this monetary system would be that, at the federal level at least, all revenues would derive from energy taxation. This is by no means a perfect form of government. The market disturbances would be enormous. Gasoline and electricity would increase several times over in cost. This would have a great impact on the economy. (Much of the effect desired, from the Collapse of Complex Societies viewpoint.) People would be heavily incentivized to substitute heavily-taxed energy sources for other forms. While the government would certainly be very deep in regards to energy (what could be deeper than nationalizing the energy sector?) it would be motivated to go wide as well. (And if we get metaphysical, everything that happens is some sort of energy transaction.)

Firewood would become a much more prominent energy source. How would that be managed? If left untaxed, tax dodgers would deforest the country within a winter. Clearly it would have to be taxed to prevent dangerous market distortions. Is the government going to inspect every campsite and cabin to make sure no one is avoiding the tax bill for free wood they found on the ground? The same argument would be made for transportation, such as horse-drawn buggies. How do we tax horses? The government would also have cause to regulate off-grid energy sources like photoelectric arrays. Hell, they'd go so far as to tax high-efficiency south-facing windows if we let them since those windows heat the home on cold winter days.

It sounds bleak. Even after limiting the government solely to the energy sector, they've still managed to encroach onto our lands and into our homes. Despite this, we've still succeeded in drastically reducing the scope of government in regards to taxation. The government no longer needs to know what we buy, where we invest our money, who employs us, and who we give money to. Those things would be outside the scope of energy-based taxation. While we'd still have raging taxation battles (should the government tax campfires?) those battles would be limited to a more narrow domain.

In the power struggle between government and the people, the people have the best advantage when the war front is narrow. Wide fronts favor the government as they spread out popular resistance. It was the intention of the Framers that all advantage be given to the people over the government. Thus, a wide-scoped government defies the American ethos and should be whittled back to something more manageable.