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What does this say about our values as a ‘free society’?


September 10, 2012
Franschhoek, Western Cape, South Africa

There’s a very dangerous expression we’ve been hearing a lot lately from all corners of the globe, mostly from socialist-leaning politicians and economists who fancy themselves champions of the people.

They look at certain tax inequalities like the difference between capital gains rates (tax on investment income) vs. income tax rates (tax on labor) and complain, “what does it say about our values as a free society when investors pay a lower tax rate than workers?”

This is a total BS red herring; it’s not an ‘either/or’ argument. They’re both wrong.

If you’re an investor or business owner, the government is your silent partner, whether you like it or not. The government doesn’t put up a single cent of capital, and they risk absolutely nothing if a venture fails. Yet if it succeeds, they’ll take a handsome share of the profit.

In any other context, this sounds absurd. If I said to you, “Cut me in for a piece of your deal, and in exchange, I will do absolutely nothing…” you would rightfully tell me to F off.

Yet somehow governments get away with this… and it’s simply the accepted norm.

Of course, statists contend that governments provide valuable services which people are obliged to pay for; it’s the old “you didn’t build that” argument. This is total bunk.

Even if one concedes that governments build the infrastructure which makes business possible, it’s plain to see that for every road, port, and title office, there are dozens of debilitating regulations which make things more difficult for everyone.

On the flip side of this coin, government also takes its ‘fair share’ of people’s labor. From farmers to physicians, government treats ALL workers like stupid milk cows.

They take a big piece of your labor, then they take an extra piece in payroll and social tax. Then they tax you on what you spend, and then again on what you save. Finally they steal whatever you have left over through inflation.

It’s important to point out that governments have an uninterrupted history of serial, catastrophic failure when it comes to handling other people’s money. It seems crazy that anyone in his right mind would advocate giving these people more even money.

Yet the luminaries to whom we award our most esteemed prizes for intellectual achievement are among those beating this drum the loudest.

As an example, Nobel laureate Joseph Stiglitz’s latest book The Price of Inequality blasts US tax policy for not being onerous enough. His only point of praise is that the US government taxes all of its citizens on their worldwide income. To him, this is actually a good thing!

This tax policy class/warfare debate is dangerous and keeps people distracted from the truth. In fact, to even use the words ‘free society’ anymore in western civilization is intellectually dishonest.

At this very moment, the US government is building the largest digital spy center in the world, right there in the land of the free. When the facility is completed, the NSA will be able to intercept, collect, monitor, and archive every email, text message, tweet, and phone call
that’s ever transmitted, worldwide.

In a free society, people would have a say in whether they want their government to have this kind of control.

Yet all of this happens without anyone’s consent. The Internet monitoring, the drone fleets, the airport radiation baths, the massive expansion of the money supply… all of this is overseen and implemented by unelected bureaucrats.

Such is the nature of the modern democratic republic– a system that has completely lost sight of freedom and elects criminals to lead the rest of us. Yes, indeed, what does all of this say about our values?

Our goal is simple: To help you achieve personal liberty and financial prosperity no matter what happens.

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About the author: Simon Black is an international investor, entrepreneur, permanent traveler, free man, and founder of Sovereign Man. His free daily e-letter and crash course is about using the experiences from his life and travels to help you achieve more freedom.

Comments on this entry are closed.

  • steveo

    Stiglitz has been an idiot Keynsian forever. they were all writing books on how small the world is and how infinite growth is so possible around 2000. now they are starting to realize the folly of their craft and they still call out for more spending of other people’s money. They are all fools who will never realize their problem.

  • Nick

    Well said Simon, don“t forget business rates, here in the UK, Kurt Geiger top shoe retailer is going to invest in malls/ shops abroad, £10k pa versus £160k in the UK, for nada! they even have to pay extra for rubbish collection

  • Warren

    Too true…

  • CRC

    “Even if one concedes that governments build the infrastructure which makes business possible…”

    This point should not be conceded at all. First, “the government” took the resources from the private sector to “build” those things so, in point of fact, the private sector DID build those things. Secondly, this whole concept begs the question that these things cannot or would not be built without government. There’s no evidence or logical reasoning that support this claim for about 90% of what government does.

  • Steve H.

    You’d think the milk cows would complain. Instead, most of them think they’re free. Or maybe that other cows aren’t being milked enough. It’s really quite pathetic.

  • jne129

    Except that in Chile now private companies are building the infrastructure instead; the tolls on the roads vary depending on usage (higher in rush hour)

  • liju philip

    Is there anything that we mortals can do when the government with all its might and reach is trying to control all kinds of information coming our way? its like…you can run, but cant hide.

  • Nickelthrower

    I’m not sure I can 100% agree with what has been written here. I do not, necessarily, see the “investment class” investing in long term growth but, rather, High Frequency Trading. Given that the vast majority of stocks are now held for less than 10 seconds, can we really say that the people that invest in the stock market are somehow Captains of Industry worthy of tax breaks?

    I have no problem taxing those “investments” at 70% or, if nothing else, a transaction tax on all stock trades to at least try to slow the bots down.

    • steve klein

      Poor Nickelthrower. You have so missed the point, entirely. Taxes shacks us! Government shouldn’t be taxing citizens at all because government produces nothing without the hard work of the workers.
      Citizens build everything, whether through their labor or the fruits of their labor. Citizens can, and will, build it all even when worthless – problem producing- government collaspes. And it will, as all of history teaches us.
      Utopia does not exist and it is time governments stop pretending that it does and that they can build the golden road to it, with just one more tax. Taxes Us- Shacks Us. No offense to those living in shacks.

  • jybw56

    Looking at all my years, over a half a century worth, I have found only two groups of people who will take our money by force, take our property by force, will force us do to things by their will and may even take our life by force if we do not listen to them, those two groups are Criminals and Government. Government is suppose to protect our rights, not use force to take them, what happened?

  • Maureen

    Even if every road or bridge were to disappear today, people would make their own paths and we would build the bridges ourselves, not just in America like Lewis and Clark or Daniel Boone but everywhere from South America to Russia to the Far East. It is human nature to do these things so that we can move commerce for ourselves and our families. To heck with the socialists and their co-opting of the human experience. Clueless and self-serving.

  • Ray

    Until we get the ability to vote for “none of the above” we will continue to elect thieves.

  • http://www.facebook.com/joe.tittiger Joe Tittiger

    Governments DO NOT build roads or anything else Simon. The tax payers do with THEIR OWN MONEY. Governments produce nothing, and steal everything that they posses.

  • li_bri
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