4 ms·

Politicians and bureaucrats try to maximize their _relative_ power over everyone else. Power ultimately comes from resources - as security apparatus requires re

Politicians and bureaucrats try to maximize their _relative_ power over everyone else. Power ultimately comes from resources - as security apparatus requires resources to function. What this means is that states try to maximize effective real level of taxes. Only two forces prevent taxes from going to ~100%: tax evasion and military risk from other states. As taxes become higher, more people start evading, reducing the real effective tax rate, which reduces real relative power of bureaucrats and politicians. Smart governments reduce taxes in that situation. If evasion becomes impossible, taxes are going to approach 100%: everything over resources needed for survival goes to the ruling class (slavery), which is historically the dominant arrangement (eg. serfdom). It wouldn't be a fundamentally new situation even in modern times - in the Soviet Union everyone, officially, made roughly the same regardless of what they did, and that amount was barely enough for survival. Which wasn't smart, because tax evasion was enormous (in the form of bribes and black market), which created a new ruling class (now called oligarchs). Military risk is another force acting against high taxes, as states that kill its economic activity (due to people having weak motivation) risk being conquered eventually by wealthier and stronger states. However, looking at North Korea in particular, it appears as long as some form of MAD is in place (in the case of NK - destruction of Seoul for decades, lately also nuclear missiles) that doesn't matter that much today. To sum it up: I'm convinced total financial surveillance inevitably means a return to slavery. Physical money is going to disappear in decades. Anonymous crypto appears to be the only force that can prevent this future.

cycomanic 6y ago
Your statements need some serious evidence to back them up. Even if one concedes that the goal of "the ruling class" is serfdom, you have brought no evidence that this is related to the amount of taxes and that taxes somehow would grow to 100%. In fact looking at the history of the US, inequality has grown as tax rates have reduced. Similarly in worldwide comparisons countries with higher tax rates are generally more equal, in other words they are less likely to have an underclass of "serfs". "Financial privacy" and ways to hide your financial transactions almost exclusively benefits those with capital, what I would already call the ruling class, as evidenced by e.g. the Panama papers.
- exo762 6y ago
  Equality/Inequality and Freedom/Serfdom lie on two different although not fully independent axes. One can be a rich slave - by not having any political freedoms.
  - cycomanic 6y ago
    The OP made an economic argument about 100% taxes and "slavery" not political freedoms, so your point is orthogonal. That said, while I agree that equality and freedom lie on different axes, I disagree with your point that one can be a rich slave, being a slave implies that you have neither economic nor political power (which are almost impossible to separate anyway).
atleta 6y ago
The things that prevent taxes from growing to 100% in a democracy are indeed wrecking the economy, causing the tax income to decrease and the risk of losing the next election. You can argue that tax evasion is one way that may cause a decreasing tax income with the increasing tax rates but it's not the only factor.

cycomanic 6y ago

Your statements need some serious evidence to back them up. Even if one concedes that the goal of "the ruling class" is serfdom, you have brought no evidence that this is related to the amount of taxes and that taxes somehow would grow to 100%. In fact looking at the history of the US, inequality has grown as tax rates have reduced. Similarly in worldwide comparisons countries with higher tax rates are generally more equal, in other words they are less likely to have an underclass of "serfs". "Financial privacy" and ways to hide your financial transactions almost exclusively benefits those with capital, what I would already call the ruling class, as evidenced by e.g. the Panama papers.

exo762 6y ago
Equality/Inequality and Freedom/Serfdom lie on two different although not fully independent axes. One can be a rich slave - by not having any political freedoms.
- cycomanic 6y ago
  The OP made an economic argument about 100% taxes and "slavery" not political freedoms, so your point is orthogonal. That said, while I agree that equality and freedom lie on different axes, I disagree with your point that one can be a rich slave, being a slave implies that you have neither economic nor political power (which are almost impossible to separate anyway).

atleta 6y ago

The things that prevent taxes from growing to 100% in a democracy are indeed wrecking the economy, causing the tax income to decrease and the risk of losing the next election. You can argue that tax evasion is one way that may cause a decreasing tax income with the increasing tax rates but it's not the only factor.