Let's privatize taxes!

Here's a little handout for anarcho-capitalists.



Oh! That must be what we're doing wrong. We simply need to have taxpayers pay the construction companies instead of paying taxes to the government to pay construction companies. This would ensure that those who actually want roads, get them, and nobody else has to pay for them.

Ok, that makes sense. Let's do it.

Now we need to build a road. Who pays for it? Well, Jim wants a road. Herb down the way wants a road too. Sally will pitch in. So will Shanesh.
So we have a group of people all pitching in to pay for a road. They pay the construction company, they get a road. Ah, liberty!

Next we want a bigger road. Same story...now the group of people who want the road is a lot bigger. Let's organize a big lobby group for it, and we'll all pay for this bigass road.
We all get together, form an organization to see who pays what, then collect a bunch of money. We pay the construction company, take a little extra for organizational overhead, and we get a bigass road. Ah, liberty!

See, this is liberty: a group of honest working people organizing around a common social good. It works great! Way better than our previous system. Nothing can ever get done with a government around.

If you're genuinely interested in learning about anarcho-capitalism then you should follow Peter Boettke's blog and David Friedman's blog.

From my perspective, anarcho-capitalism is completely unnecessary. The basic premise is that the private sector is far superior to the public sector...but for the simple reason that the market determines the distribution of resources in the private sector. I certainly agree that markets are far superior...so why not just create a market in the public sector? All that's needed to create a market is...

1. Demand
2. Supply
3. Choice

There's clearly a demand for public goods...government organizations already supply public goods...so all that's needed is to allow taxpayers to choose which public goods they want more of.

What will the outcome be? We can't know the specifics...all we can do is understand the process. If we understand the process then there's no need to eliminate the public sector. We'll simply allow taxpayers, as a group, to determine whether the benefit of each and every government organization is worth the cost. This is known as tax choice.

It's a given that limited resources will be put to more productive uses. This means that they will produce a greater benefit to society. This is how markets work. They direct resources to the organizations that do the most with them. We know that organizations do the most with their limited resources because consumers use their dollars to indicate how satisfied they are with how an organization is using society's limited resources. If a new organization comes along that figures out how to do even more with a limited resource than an old organization...then consumer's will use their dollars to vote for the new organization. This will shift the limited resource from the old organization to the new organization. This is the basis for progress. Markets are constantly shifting limited resources to the people who use them to benefit more people.

But a resource is a resource whether it's in the private sector or the public sector. Once we create a market in the public sector then we'll allow taxpayers to decide if government organizations can use limited resources as effectively, efficiently and beneficially as private organizations can. This is why anarcho-capitalism is completely unnecessary.

You should read "But Who Will Build The Roads?" By Francois Tremblay

gavinfielder said:

Now we need to build a road. Who pays for it? Well, Jim wants a road. Herb down the way wants a road too. Sally will pitch in. So will Shanesh.

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Everybody else in their town wants a road to, but refuses to pay for it. Suddenly, Jim, Herb, Sally, and Shanesh are annoyed and refuse to pay. Why should they pay for a road everybody else is going to use for free? So the road doesn't get built.

Or . . . Jim, Herb, Sally, and Shanesh pay for the road, but then everybody else starts using it without paying for it. They are infuriated. This isn't fair! They shriek. They want to stop them . . . but there is no court system, and no police.

Or . . . Jim decides to build a road by himself. He also hires an army of thugs to protect it. Herb, Sally, and Shanesh are willing to pay for their own roads, but they would have to cross Jim's road, and Jim refuses to allow it. He makes them pay $1,000 a month for the right to cross his road.

Government serves many purposes.

Krhazy said:

Everybody else in their town wants a road to, but refuses to pay for it. Suddenly, Jim, Herb, Sally, and Shanesh are annoyed and refuse to pay. Why should they pay for a road everybody else is going to use for free? So the road doesn't get built.

Or . . . Jim, Herb, Sally, and Shanesh pay for the road, but then everybody else starts using it without paying for it. They are infuriated. This isn't fair! They shriek. They want to stop them . . . but there is no court system, and no police.

Or . . . Jim decides to build a road by himself. He also hires an army of thugs to protect it. Herb, Sally, and Shanesh are willing to pay for their own roads, but they would have to cross Jim's road, and Jim refuses to allow it. He makes them pay $1,000 a month for the right to cross his road.

Government serves many purposes.

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:roll:

There shouldn't be a character limit for posting. Some posts require nothing more than an eye roll.

Krhazy said:

Everybody else in their town wants a road to, but refuses to pay for it. Suddenly, Jim, Herb, Sally, and Shanesh are annoyed and refuse to pay. Why should they pay for a road everybody else is going to use for free? So the road doesn't get built.

Click to expand...

Why would several people stay unhappy when they can work together to resolve it?

Krhazy said:

Or . . . Jim, Herb, Sally, and Shanesh pay for the road, but then everybody else starts using it without paying for it. They are infuriated. This isn't fair! They shriek. They want to stop them . . . but there is no court system, and no police.

Click to expand...

If they wanted to own and control the road, why would they build it and not borrow money to buy security, and then later recoup those expenses through toll fees?

Krhazy said:

Or . . . Jim decides to build a road by himself. He also hires an army of thugs to protect it. Herb, Sally, and Shanesh are willing to pay for their own roads, but they would have to cross Jim's road, and Jim refuses to allow it. He makes them pay $1,000 a month for the right to cross his road.

Click to expand...

But then Jim will be very unhappy with just his one road. He'll only be able to travel in one direction on it. So at some point, won't he decide it's better to share it as long as the others agree to share their roads after they're built?

Krhazy said:

Government serves many purposes.

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Pretend Jim stole $100,000,000,000 from Herb, Sally, Shanesh, and many others to build 100 free public roads and and also buy himself 100 aircraft carriers.

Now Jim is the (typical) government.

Donahue said:

:roll:

There shouldn't be a character limit for posting. Some posts require nothing more than an eye roll.

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When you can't muster enough substance to meet a character limit of two words, perhaps you shouldn't be posting.

the whole point of a democratic governmental like body is to make public goods/services availability or accountability or decision making not dependant on economic power ... What libertarians or anarcho-capitalists propose is basically plutocracy.

solletica said:

Why would several people stay unhappy when they can work together to resolve it?

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Greed.

If they wanted to own and control the road, why would they build it and not borrow money to buy security, and then later recoup those expenses through toll fees?

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You are missing the point, which is that without an enforcement system, there is no way to recoup anything (absent private police forces...see below).

But then Jim will be very unhappy with just his one road. He'll only be able to travel in one direction on it. So at some point, won't he decide it's better to share it as long as the others agree to share their roads after they're built?

Click to expand...

Perhaps. Or maybe he uses his police force to take their roads.

Pretend Jim stole $100,000,000,000 from Herb, Sally, Shanesh, and many others to build 100 free public roads and and also buy himself 100 aircraft carriers.

Now Jim is the (typical) government.

Click to expand...

Only if the majority of Herb, Sally, Shanesh and the others voted for those things, and if they choose to keep Jim in office.

Without public accountability, Jim is very unlike the typical democratic government. He is a dictator. Anarchism is nothing more than a wish to return to monarchism or, at the very least, oligarchy.

RGacky3 said:

the whole point of a democratic governmental like body is to make public goods/services availability or accountability or decision making not dependant on economic power ... What libertarians or anarcho-capitalists propose is basically plutocracy.

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You said it better.

gavinfielder said:

Here's a little handout for anarcho-capitalists.

Oh! That must be what we're doing wrong. We simply need to have taxpayers pay the construction companies instead of paying taxes to the government to pay construction companies. This would ensure that those who actually want roads, get them, and nobody else has to pay for them.

Ok, that makes sense. Let's do it.

Now we need to build a road. Who pays for it? Well, Jim wants a road. Herb down the way wants a road too. Sally will pitch in. So will Shanesh.
So we have a group of people all pitching in to pay for a road. They pay the construction company, they get a road. Ah, liberty!

Next we want a bigger road. Same story...now the group of people who want the road is a lot bigger. Let's organize a big lobby group for it, and we'll all pay for this bigass road.
We all get together, form an organization to see who pays what, then collect a bunch of money. We pay the construction company, take a little extra for organizational overhead, and we get a bigass road. Ah, liberty!

See, this is liberty: a group of honest working people organizing around a common social good. It works great! Way better than our previous system. Nothing can ever get done with a government around.

Click to expand...

I love a priori arguments.

You assume that people could collect enough money to build those roads. Be rational enough to organize in such a way, and rational enough to build the road that benefits the community the most.

I work with local alderman here and people can't even agree on what to do with an old hospital that needs to be rezoned into commercial space.

It would take about 6 years to decide where to build the road, whose house to bulldoze, and then halfway through it would stall because people would stop paying into it.

Government exists to avoid this enormous problem of people not being able to agree to where the road should go and which citizens need to be ignored.

Did you ever notice that when you reach the end of I-76 westbound out of Pennsylvania, the Ohio part starts in the very same place?

Ugh, I hate it when most an-caps speak. The average yokel tries to lump all libertarians in with them.

You cannot privatize infrastructure. You simply cannot. From an an-cap perspective, all they would do is pave the major roads, and leave many roads as dirt and grass for the sole criterion of "they're not used as much". Now, I'm a utilitarian so I can't completely argue against this point, but the truth is that infrastructure is still proof of market failure, and supplies have to be given to parts of it that reflect the inefficient public good - you know, roads that aren't major interstate highways. When you start arguing moral hazards and free riders over the most basic public goods, you create a system that's highly prone to corruption.

Gipper said:

Ugh, I hate it when most an-caps speak. The average yokel tries to lump all libertarians in with them.

You cannot privatize infrastructure. You simply cannot. From an an-cap perspective, all they would do is pave the major roads, and leave many roads as dirt and grass for the sole criterion of "they're not used as much". Now, I'm a utilitarian so I can't completely argue against this point, but the truth is that infrastructure is still proof of market failure, and supplies have to be given to parts of it that reflect the inefficient public good - you know, roads that aren't major interstate highways. When you start arguing moral hazards and free riders over the most basic public goods, you create a system that's highly prone to corruption.

Click to expand...

I think that infrastructure can be privatized, but unless the private sector decides to create needed infrastucture, it is the duty of the government to do so. I also don't believe that gov should sell public infrastructure to private companies for the purposes of them using to make a profit when that profit is subsidized by the government, and the tax payer then ends up paying twice for the same road (once when the road is built at tax payer expense, then again when the tax payer has to pay a toll to use the road).

If a company can create infrastructure, then good for them, but when private companies are not willing to make the initial investment and entrapanurial effort to create infrastructure, we certainly don't need government subsidizing their desire for a profit by gov creating the infrastructure at great expense to the tax payer, then selling it (assumably at a cost lower than it would have cost the private company to create it in the first place) so that a private company can financially rape our citizens - hell, the government already does enough of that, we don't need government doing it and then private companies doing it again.

When we hear about gov selling or leasing roads to private companies so that the private companies can charge a toll, it sounds like a good deal to the taxpayer because the government gets some money back, but in reality it is just creating a new tax - the one that the private company puts on everyone who uses that road. The tax payers do not typically come out for the better.

imagep said:

I think that infrastructure can be privatized, but unless the private sector decides to create needed infrastucture, it is the duty of the government to do so. I also don't believe that gov should sell public infrastructure to private companies for the purposes of them using to make a profit when that profit is subsidized by the government, and the tax payer then ends up paying twice for the same road (once when the road is built at tax payer expense, then again when the tax payer has to pay a toll to use the road).

If a company can create infrastructure, then good for them, but when private companies are not willing to make the initial investment and entrapanurial effort to create infrastructure, we certainly don't need government subsidizing their desire for a profit by gov creating the infrastructure at great expense to the tax payer, then selling it (assumably at a cost lower than it would have cost the private company to create it in the first place) so that a private company can financially rape our citizens - hell, the government already does enough of that, we don't need government doing it and then private companies doing it again.

When we hear about gov selling or leasing roads to private companies so that the private companies can charge a toll, it sounds like a good deal to the taxpayer because the government gets some money back, but in reality it is just creating a new tax - the one that the private company puts on everyone who uses that road. The tax payers do not typically come out for the better.

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The first part was close to what I was getting at. Private enterprise exists because of a profit motive. I seriously do not think that all paved, created roads will create a profit for the designer, which is why I'm against it. Sure, major highways can have realizable income, but what about the road that leads from my house into the local city? Chances are that, if given a static value, it wouldn't create the profit justifiable to make it. This is where the market failures would come into play.

Now, this can be marginalized with the existence of toll roads, thus making up for heavy traffic on a cost-per-use basis on these roads, but there are still some roads that could probably be made once, last 50 years, and still not be as valuable on a comparable basis as others. Unless you want to just make those roads free-for-all, a market failure still exists in this capacity.

This was less on the privatization of infrastructure and more an observation that, on the assumption it could actually be done, it doesn't entail a fundamental difference in the outcome.

imagep had it right: tolls, taxes, what's the difference? It's just paying for a common good, organized by the common good.

Of course, if you don't think it is organized by the common good, then you simply aren't doing your job as a citizen.

Among other things the OP fails to take into consideration transaction costs, which in many infrastructure situations overwhelm the utility of the project. The transaction costs of taxing citizens pursuant to laws passed by their representatives and then using those funds to build roads that benefit commerce in general, are relatively small with respect to the productivity gains realized from a road system. It's a fairly efficient method for building roads, as years of experience has shown.

In contrast, the transaction costs of raising private capital, allocating the roads in a way that realizes a return on capital, and purchasing the land from private owners, dealing with the inconvenience and possible lawsuits relating to construction (without externalizing the cost), and charging users, would result in huge transaction costs.

I would note anecdotally that most toll roads typically don't take into consideration the externalized costs -- since they are often build on existing systems and the construction usuing slows traffice for months if not years during the construction process. Why should the public pay for that in slower traffic just so a private citizen can profit from it?

This video is actually a far stronger case for anarcho-capitalism. The problem, which I critique in my post on Unglamorous but Important Things, is his emphasis on morality (the absence of coercion)...

gavinfielder said:

Oh! That must be what we're doing wrong. We simply need to have taxpayers pay the construction companies instead of paying taxes to the government to pay construction companies. This would ensure that those who actually want roads, get them, and nobody else has to pay for them.

Ok, that makes sense. Let's do it.

Now we need to build a road. Who pays for it? Well, Jim wants a road. Herb down the way wants a road too. Sally will pitch in. So will Shanesh.
So we have a group of people all pitching in to pay for a road. They pay the construction company, they get a road. Ah, liberty!

Next we want a bigger road. Same story...now the group of people who want the road is a lot bigger. Let's organize a big lobby group for it, and we'll all pay for this bigass road.
We all get together, form an organization to see who pays what, then collect a bunch of money. We pay the construction company, take a little extra for organizational overhead, and we get a bigass road. Ah, liberty!

See, this is liberty: a group of honest working people organizing around a common social good. It works great! Way better than our previous system. Nothing can ever get done with a government around.

Click to expand...

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