Just what is this “Freedom” you lay claim to and who is free to do what to whom?
Is it the “freedom” to own slaves by a few or to make certain people second class citizens?
Or is it the freedom to be have a well-payiing job with respect from your employer?
Is it the “freedom” to gerrymander voting districts to give yourselves an unfair electoral advantage?
Or is it the freedom to know that your vote will count in a fair election?
Is it the “freedom” to be free from paying taxes for all the benefits that have helped you get rich? Like public schools for educated workers, like roads to move your goods around, like courts to settle any disputes you may have, like police to investigate crimes committed against you, like fire departments to respond quickly to fires or medical emergencies?
Or is it the freedom to have all kinds of resources available that we can only afford collectively by contributing to the best of our ability?
Is it the “freedom” to have wider and wider highways to drive faster and quicker, regardless of the cost to tax bases, to individual families, or to the environment?
Or is it the freedom to be secure in your own house, knowing that the chances are almost non-existent that your house will be condemned to make room for an ever wider freeway? Is it the freedom to not have to have a car because other forms of transportation are convenient and frequent?
Is it the “freedom" to reduce your own costs by polluting the air and water?
Or is it the freedom to have clean breathable air or to have safe, drinkable water?
Is it the “freedom” to donate large sums to “elected” officials to do your bidding?
Or is it the freedom to know the candidates you can vote for have received “small” amounts of money only from the people who have a right to vote for them.
See also "The false masters of words".
Showing posts with label public goods. Show all posts
Showing posts with label public goods. Show all posts
Tuesday, March 28, 2017
Wednesday, October 26, 2016
A rebuttal of the Star Tribune misuse of the term “free market”
I submitted the following commentary to the Star Tribune a day or two after D.J. Tice’s column which I considered another misuse of the term “free market”. I have not seen it published yet. Could it be that “free marketers” don’t like reminders of true free markets?
D.J. Tice’s column “ A foolish system and your money …” leads me to believe he is one of those who knows the price of everything and the value of nothing. I wonder if he has considered the number of times in a day that he has benefitted from public goods.
Did he drive on a freeway to work? Did he pay the full cost of his share of the road, the full cost of the pollution from his car, and the cost of the loss of tax revenues from the houses that once were above the trenches that divide up our cities?
Did he take a bus to work? His fare would have only paid part of the cost. But the bus is a public good in that it reduces the number of cars on the road. If he had to pay the full cost of his bus ride, he probably wouldn’t take the bus.
Did he walk to work? Did he pay a toll for the sidewalk he used? Did he put a coin in the traffic lights so that he could cross the street?
Let’s hope that his house never catches fire. He would not be happy paying the full cost of the fire department response. If his neighbor had the misfortune of a fire, would he help pay the cost of the fire department whose response kept the fire from spreading to his house?
I am a graduate of the Cleveland Public School System. I doubt that my mother could have afforded the full cost of the schooling that qualified me to attend college. Many other people, some childless, helped pay the cost of my education.
I could not have afforded the tuition at Case Institute of Technology. A foundation paid full tuition the first year. I flunked out of Case but the foundation kept paying a fraction of my tuition at Ohio Wesleyan University. At both schools, many donors provided money to keep the tuition down somewhat. Three-percent federal loans also helped. I managed to get back to Case for graduate school with a graduate assistant position. I doubt any of the work we did paid in full for our jobs and tuition.
Companies are demanding more and more highly specialized “skills”, but they are not willing to train people. They expect the public schools and the colleges and universities to train these employees. But they don’t want to pay the taxes for the public schools and colleges, institutions that would help those who can’t afford the elite institutions. The smaller the pool of potential employees, the harder it is to find “qualified” employees.
Could he pay out of pocket for each and every medical visit he needed: office or hospital? For those of us with well-paying jobs, health insurance pays for a chunk of the care, if not all. But what about people who have jobs with no health insurance? Has he considered that their lack of health insurance benefits him with lower prices? (Or the owners with much higher profits.)
What if there were a deadly epidemic that had no respect for wealth? How might such an epidemic start? Maybe those who first became ill could not afford the health care, health care that would have reduced their chances of spreading their disease.
Modern economies run a large array of public goods: roads, schools, police, fire, and regulatory inspections. As Justice Oliver Wendell Holmes supposedly said, “I like taxes; they buy me civilization.”
D.J. Tice’s column “ A foolish system and your money …” leads me to believe he is one of those who knows the price of everything and the value of nothing. I wonder if he has considered the number of times in a day that he has benefitted from public goods.
Did he drive on a freeway to work? Did he pay the full cost of his share of the road, the full cost of the pollution from his car, and the cost of the loss of tax revenues from the houses that once were above the trenches that divide up our cities?
Did he take a bus to work? His fare would have only paid part of the cost. But the bus is a public good in that it reduces the number of cars on the road. If he had to pay the full cost of his bus ride, he probably wouldn’t take the bus.
Did he walk to work? Did he pay a toll for the sidewalk he used? Did he put a coin in the traffic lights so that he could cross the street?
Let’s hope that his house never catches fire. He would not be happy paying the full cost of the fire department response. If his neighbor had the misfortune of a fire, would he help pay the cost of the fire department whose response kept the fire from spreading to his house?
I am a graduate of the Cleveland Public School System. I doubt that my mother could have afforded the full cost of the schooling that qualified me to attend college. Many other people, some childless, helped pay the cost of my education.
I could not have afforded the tuition at Case Institute of Technology. A foundation paid full tuition the first year. I flunked out of Case but the foundation kept paying a fraction of my tuition at Ohio Wesleyan University. At both schools, many donors provided money to keep the tuition down somewhat. Three-percent federal loans also helped. I managed to get back to Case for graduate school with a graduate assistant position. I doubt any of the work we did paid in full for our jobs and tuition.
Companies are demanding more and more highly specialized “skills”, but they are not willing to train people. They expect the public schools and the colleges and universities to train these employees. But they don’t want to pay the taxes for the public schools and colleges, institutions that would help those who can’t afford the elite institutions. The smaller the pool of potential employees, the harder it is to find “qualified” employees.
Could he pay out of pocket for each and every medical visit he needed: office or hospital? For those of us with well-paying jobs, health insurance pays for a chunk of the care, if not all. But what about people who have jobs with no health insurance? Has he considered that their lack of health insurance benefits him with lower prices? (Or the owners with much higher profits.)
What if there were a deadly epidemic that had no respect for wealth? How might such an epidemic start? Maybe those who first became ill could not afford the health care, health care that would have reduced their chances of spreading their disease.
Modern economies run a large array of public goods: roads, schools, police, fire, and regulatory inspections. As Justice Oliver Wendell Holmes supposedly said, “I like taxes; they buy me civilization.”
Tuesday, September 16, 2014
School choice and the free market
School choice and the free market
Melvyn D. Magree
Originally published in
the Northland Reader
now the
Reader Weekly
"School choice...whatta concept"
February 17, 2000
Melvyn D. Magree
Originally published in
the Northland Reader
now the
Reader Weekly
"School choice...whatta concept"
February 17, 2000
Posted in blog 2014-09-16
In the debate about “school choice” the phrases “let the free market decide” and “competition will bring out the best” are often used. What are “the free market” and “competition”? Is “school choice” an issue that can best be determined by “the free market” or “competition”?
The definition of an ideal free market includes
• Large number of buyers and sellers
• Free entry and exit of the market
• Knowledge of all relevant prices
• All goods are “private goods”; all the benefits and all the costs are reflected in the price
“School choice” certainly involves a large number of buyers. Students in a given urban community number in the thousands. In an ideal market a large number of buyers would lead to a large number of sellers.
Children are required to enter the market for schools, and they aren’t free to exit it. Even if they were to change to another school, it would be difficult to do so for many reasons until the end of a school year. Schools take a bit of time to enter or exit the market, but many businesses do so also.
Parents and children may be able to get lists of prices of all the schools, but it is very difficult for parents and children to know all features of all schools. The price is not only money but quality and quantity of services.
The costs of schools may be reflected in the price of tuition, but the benefits go far beyond those paying the price. Not only do the children and the parents benefit from school, but the society at large benefits. Companies have workers that communicate and reason well. The community and the nation have people who can produce products, services, and ideas. Neighbors have interesting friends. The city, the county, and the state have informed voters. In other words, education is not a “private good” but a “public good”.
Economists define a “public good” as being non-rival, prohibitively expensive, or having benefits that are not limited to the buyer.
A non-rival good is one that can be used by many people at the same time. It is also available not just to the highest bidder, but to all regardless of ability to pay.
A prohibitively expensive good costs more than one person or group wants to pay. Few people can afford all the costs of education. Even private schools do not charge the full costs; they have endowments, scholarship funds, and general contributions.
As discussed earlier, many people benefit from an educated society, not just parents and students “buying” an education.
If something is a public good benefitting a large portion of the community, then it generally seems fair that the public pays through taxation. If the public pays for something then the public would like to have some say in what the public good is like and how much it costs. The most satisfactory means of expressing the public will for over 200 years has been democratic representation. The public elects representatives charged with certain responsibilities. The representatives determine the nature of the public good, what is an acceptable cost for the public good, and how to raise the funds to pay for it.
The representatives could decide to provide the public good through a government agency or subsidize it through a contractor. If a government agency provides the public good, then the representatives generally do not provide subsidies for alternative provisions. For example, if the government has a police or fire department it does not provide a subsidy for those who would have their own police or firefighters. Should education be any different?
If schools are to be subsidized, should there be only one contractor or many? The other argument for “school choice”, “competition,” implies that there should be many contractors for schools. What does competition lead to?
“Competition” implies schools have competition for buyers; that is, buyers select a school. But the reality is that students compete for private schools; the schools select the buyers. All of the buyers cannot select the school that meets their needs.
If a product is more popular than competing products, the manufacturer can do two things: supply more product or raise prices. If the manufacturer decides to supply more product it may be able to do so quickly. If it decides to raise prices, some buyers may decide to go elsewhere but the manufacturer will probably retain enough buyers to have a satisfactory profit for some time or to have more money to put into improving the product.
But if a school is more popular than its capacity, it cannot meet that demand for a year or more. Should it then raise its prices to have a higher profit or to fund additional improvements in the school?
Now if the public is going to pay for such a school through vouchers, does it pay the full cost asked by the school? Or does it pay only a certain minimum that is guaranteed to all students.
In the first case we get into another economic idea, efficiency. One kind of economic efficiency is low cost production. That is, a free market will reward the lowest cost producers and punish the highest cost producers. But if a voucher pays the price asked for by a high cost producer, do we have a free market?
On the other hand, if a voucher pays only a guaranteed minimum, then it reduces the number of buyers. Only the children of those families who can afford to pay the difference can go to the very selective schools. “School choice” becomes limited for the rest of the children.
©2000, 2004, 2007 Melvyn D. Magree
keywords: Melvyn Magree, Melvyn D. Magree, Party of One, Reader Weekly, school choice, free market, public goods, public schools, fire department, police department, vouchers, competition
Thursday, April 10, 2014
Up to no good about public goods
On April 2, the Duluth News Tribune had an “Our View” titled “Road repairs: Hold on to your wallets” about the report of a task force on the repair of city streets. Why is it that increased taxes to pay for necessary public goods is a bad thing, but increased prices of things provided by the private sector are just seen as “passing on costs”?
It is estimated that a thirty percent increase over two years in property taxes is necessary to pay for the needed repairs. This is partly required because Duluth can no longer count on the money it had received from the Fond-du-Luth Casino. In other words, the “tax” paid by gamblers will now have to be paid by all the citizens.
The oldest real estate tax record I have is from 2002. Our 2014 Duluth property taxes are 2.28 times as much as 2002. Assuming the proposed 30 percent increase, our 2016 taxes will be 2.97 times as much in 2002.
Now lets compare this to the price increase of Duluth News Tribune. When I first came to Duluth in 1999, the DNT costs 50 cents. I’m not sure whether it first went up before or after 2002. It now costs $1.25 for a single copy. That is 2.5 times as much. That’s “worse” than the increase in my Duluth property taxes up to now. Will it go to $1.50 by 2016? If so, that will be 3.0 times as much. Where’s all the shouting about the Duluth News Tribune not living within its means?
How about food prices? The price of Stonyfield yogurt sticks in my mind from years ago as 54 cents for an eight-ounce container. One can now get it online for about $1.42 for a six-ounce container. That is 3.5 times as much per ounce! Can’t Stonyfield and the grocers live within their means?
The lowest I remember gas prices being in Duluth was 99 cents a gallon. Now the price per gallon has been around $3.59 per gallon. That is 3.6 times the low. Can’t the oil companies live within their means?
What are some major costs in repairing streets? Asphalt, gasoline, and diesel fuel! Maybe we can keep our taxes at the 2002 level if we can keep the price of oil and the derivative products at the 2002 level.
But this year, the city took a big hit on fuel expenses. Lots and lots of snowplowing. Should the city cut back on the snowplowing to “live within its means”? How loud would the howls be from the public if the city “lived within its means” for snowplowing?
The same goes for street repair. It seems many expect city streets to be built to Interstate standards, but they complain both about the potholes and the taxes to fill the potholes.
We could go back to an ancient custom of every road being a toll road. Barons and other large landowners charged everybody to use the roads across their lands. This was a big drain on commerce. In fact, some writers say that the British economy in the 1700s did much better than the French economy because of internal tolls. The British had practically none. A French merchant couldn’t travel 20 miles without encountering an internal tariff. Add that to the super-rich in France ripping off the peasants even more than the super-rich in Britain did.
Ah, toll roads! Some think that the toll prohibition on Interstates should be lifted. Actually, there is no blanket prohibition as anyone who has driven I-90 in Illinois or the Ohio Turnpike knows.
As the need and costs of repairs to the Interstate system increases, so does the talk of charging tolls for use of the system. See “Agreement on Interstate Repair Needs, but Not on How to Pay for Them”, New York Times, April 3, 2014. Interestingly, some of the big shippers like FedEx and McDonalds object to the tolls. Many smaller businesses such as restaurants and convenience stores object because they think people will avoid the Interstates to avoid paying a toll each time they exit for a short stop. Another consideration is what will be the cost to add on the infrastructure to collect tolls?
I bet you dollars to donuts that many of those who want and even demand public goods such as a highway system also object to almost every single tax that makes them possible.
In many ways, taxes are a good bargain. If we didn’t pay taxes for fire departments, we would be paying a lot more for fire insurance. If we didn’t pay taxes for an extensive sewer system, we would be paying a lot more for hospital bills. If we didn’t pay taxes for snowplowing, we would be paying a lot more for auto insurance and maybe even lawyers.
Yeah, I was grumbling as I filled out my state and federal taxes and robbed my bank account to pay what’s due. And I’m grumbling as I try to figure out how to better spread out payments for the 2014 tax year. But then I think of the words of George Washington and Justice Oliver Wendell Holmes, Jr.
In his “Farewell Address”, George Washington wrote, “that towards the payment of debts there must be Revenue; that to have Revenue there must be taxes”.
Justice Oliver Wendell Holmes, Jr. supposedly wrote, “I like taxes; they buy me civilization.”
It is estimated that a thirty percent increase over two years in property taxes is necessary to pay for the needed repairs. This is partly required because Duluth can no longer count on the money it had received from the Fond-du-Luth Casino. In other words, the “tax” paid by gamblers will now have to be paid by all the citizens.
The oldest real estate tax record I have is from 2002. Our 2014 Duluth property taxes are 2.28 times as much as 2002. Assuming the proposed 30 percent increase, our 2016 taxes will be 2.97 times as much in 2002.
Now lets compare this to the price increase of Duluth News Tribune. When I first came to Duluth in 1999, the DNT costs 50 cents. I’m not sure whether it first went up before or after 2002. It now costs $1.25 for a single copy. That is 2.5 times as much. That’s “worse” than the increase in my Duluth property taxes up to now. Will it go to $1.50 by 2016? If so, that will be 3.0 times as much. Where’s all the shouting about the Duluth News Tribune not living within its means?
How about food prices? The price of Stonyfield yogurt sticks in my mind from years ago as 54 cents for an eight-ounce container. One can now get it online for about $1.42 for a six-ounce container. That is 3.5 times as much per ounce! Can’t Stonyfield and the grocers live within their means?
The lowest I remember gas prices being in Duluth was 99 cents a gallon. Now the price per gallon has been around $3.59 per gallon. That is 3.6 times the low. Can’t the oil companies live within their means?
What are some major costs in repairing streets? Asphalt, gasoline, and diesel fuel! Maybe we can keep our taxes at the 2002 level if we can keep the price of oil and the derivative products at the 2002 level.
But this year, the city took a big hit on fuel expenses. Lots and lots of snowplowing. Should the city cut back on the snowplowing to “live within its means”? How loud would the howls be from the public if the city “lived within its means” for snowplowing?
The same goes for street repair. It seems many expect city streets to be built to Interstate standards, but they complain both about the potholes and the taxes to fill the potholes.
We could go back to an ancient custom of every road being a toll road. Barons and other large landowners charged everybody to use the roads across their lands. This was a big drain on commerce. In fact, some writers say that the British economy in the 1700s did much better than the French economy because of internal tolls. The British had practically none. A French merchant couldn’t travel 20 miles without encountering an internal tariff. Add that to the super-rich in France ripping off the peasants even more than the super-rich in Britain did.
Ah, toll roads! Some think that the toll prohibition on Interstates should be lifted. Actually, there is no blanket prohibition as anyone who has driven I-90 in Illinois or the Ohio Turnpike knows.
As the need and costs of repairs to the Interstate system increases, so does the talk of charging tolls for use of the system. See “Agreement on Interstate Repair Needs, but Not on How to Pay for Them”, New York Times, April 3, 2014. Interestingly, some of the big shippers like FedEx and McDonalds object to the tolls. Many smaller businesses such as restaurants and convenience stores object because they think people will avoid the Interstates to avoid paying a toll each time they exit for a short stop. Another consideration is what will be the cost to add on the infrastructure to collect tolls?
I bet you dollars to donuts that many of those who want and even demand public goods such as a highway system also object to almost every single tax that makes them possible.
In many ways, taxes are a good bargain. If we didn’t pay taxes for fire departments, we would be paying a lot more for fire insurance. If we didn’t pay taxes for an extensive sewer system, we would be paying a lot more for hospital bills. If we didn’t pay taxes for snowplowing, we would be paying a lot more for auto insurance and maybe even lawyers.
Yeah, I was grumbling as I filled out my state and federal taxes and robbed my bank account to pay what’s due. And I’m grumbling as I try to figure out how to better spread out payments for the 2014 tax year. But then I think of the words of George Washington and Justice Oliver Wendell Holmes, Jr.
In his “Farewell Address”, George Washington wrote, “that towards the payment of debts there must be Revenue; that to have Revenue there must be taxes”.
Justice Oliver Wendell Holmes, Jr. supposedly wrote, “I like taxes; they buy me civilization.”
Saturday, February 11, 2012
Comment on taxable income
I posted the following comment to "CommonWealth:Assets vs. Income" by Will Rice on the Facebook page of the Coffee Party. It and the comments are various positions about taxing interest and capital gains.
If John and Mary start a company and sell stock in it to you, you have made an investment. If later I buy that stock from you at more than you paid John and Mary, I'm not making an investment in John and Mary's company; I'm providing you with liquidity for your investment. John and Mary have gained nothing from my purchase of your stock. Well, not quite, the liquidity I have provided to you makes it easier for them to sell new stock if they need to expand.
If purchase of stock on the open market is truly an investment, then why are you taxed at the full rate on the whole amount that you withdraw from your IRA or 401k? You are not taxed on the sale price minus the cost basis as you would be if you had bought stock for a regular account.
In either case, we have not done much work for our gains, unless you count biting nails when the stock goes down as work. The people who have done the actual work are John, Mary, and their employees. They have sweated and worried as we watched on the sidelines. And for this, we tax them at a higher rate. That does not sound like an incentive to get people to work.
Worse, we expect them to pay for all the infra-structure that makes their company successful: education, streets and sewers, police and fire, courts, and many other public goods. Those who pay a smaller portion of their income for public goods are free riders; without public goods they would have much smaller incomes. If you don't think public goods matter, consider that more large corporations tend to have their headquarters in "high-tax" states than in "low-tax" states. The public goods in the "high-tax" states made the corporations possible and the CEOs like the quality of life in these states. See "The fallacy of ranking states by 'tax burden'".
If John and Mary start a company and sell stock in it to you, you have made an investment. If later I buy that stock from you at more than you paid John and Mary, I'm not making an investment in John and Mary's company; I'm providing you with liquidity for your investment. John and Mary have gained nothing from my purchase of your stock. Well, not quite, the liquidity I have provided to you makes it easier for them to sell new stock if they need to expand.
If purchase of stock on the open market is truly an investment, then why are you taxed at the full rate on the whole amount that you withdraw from your IRA or 401k? You are not taxed on the sale price minus the cost basis as you would be if you had bought stock for a regular account.
In either case, we have not done much work for our gains, unless you count biting nails when the stock goes down as work. The people who have done the actual work are John, Mary, and their employees. They have sweated and worried as we watched on the sidelines. And for this, we tax them at a higher rate. That does not sound like an incentive to get people to work.
Worse, we expect them to pay for all the infra-structure that makes their company successful: education, streets and sewers, police and fire, courts, and many other public goods. Those who pay a smaller portion of their income for public goods are free riders; without public goods they would have much smaller incomes. If you don't think public goods matter, consider that more large corporations tend to have their headquarters in "high-tax" states than in "low-tax" states. The public goods in the "high-tax" states made the corporations possible and the CEOs like the quality of life in these states. See "The fallacy of ranking states by 'tax burden'".
Saturday, August 14, 2010
Fair share of taxes, what's that?
Charges go back and forth about taxes. Some say the rich should pay their fair share of taxes; others say that taxes hinder entrepreneurship. As usual, the extreme positions miss the truth by a couple miles or a hundred.
First, what is a fair share? Is it the same percentage as everybody else? Is it a progressive rate without a lot of gimmicks to reduce taxes. Or is it a share commensurate with the benefits received?
Second, how many rich people are really entrepreneurs? Few of us really know. Some have inherited their wealth and are just "clipping coupons", an old phrase for getting the interest payment on bonds. Some have invested in stocks, but how many were original investors? Aren't many "investors" really traders trying to take advantage of the variations of stock prices? About the only social benefit traders provide is liquidity. Some rich people are executives of companies that they didn't create, but have managed by one means or another to gain control, sometimes with disastrous results for the shareholders, employees, and society.
Let's look at the hypothetical entrepreneur to determine what his "fair share" of taxes should be.
Bugs Bunner has forty acres in which he has planted carrots. He starts by plowing his fields all day in the early spring. Then he uses a planter to put in rows and rows of carrot seeds. He spends many a day cutting the weeds down and keeping the deer and rabbits out. Come fall he takes his carrots to market and hopes to cover his costs and make a profit.
One year he finds a carrot variety that keeps well and tastes great even after a year of cold storage. Grocers all over the state seek his carrots out.
Now we get into the first problem of being a self-sufficient entrepreneur. How do his carrots get into the stores? On public roads. How do the roads get paid for? By taxes. What is Bugs Bunner's fair share of the cost of the roads? Is it a share of his income? Is it the cost of his use of the roads? If everything was truly free market, he would pay the owner of the roads a toll for every use of the roads.
Bugs Bunner's carrots are so popular that he buys more land and plants even more carrots. His plantings get so extensive that he can no longer do all the work himself. He has to hire farm laborers. How much will he pay them? It partly depends on the supply of labor - low supply, high wages; high supply, low wages. Let's suppose there is a high supply of labor and he pays low wages.
Will he pay enough for decent housing, for health care, adequate food, and so on? If not, who pays for making sure the needs of his work force are met. Would that be called welfare? Welfare is often paid for by taxes. How much of these taxes should Bugs Bunner pay?
If he requires literacy in his laborers, who pays for them to learn to read? Their parents? But if the next generation of his laborers are the children of his current laborers, can the parents afford to pay for their children's schooling? If the parents can't afford to pay for schools, then the government will have to pay for the schools. Guess what? This requires taxes. What is Bugs Bunner's fair share of these taxes?
On and on it goes. Until we recognize that "no man is an island unto itself", we will continue to argue what a fair share of taxes is.
First, what is a fair share? Is it the same percentage as everybody else? Is it a progressive rate without a lot of gimmicks to reduce taxes. Or is it a share commensurate with the benefits received?
Second, how many rich people are really entrepreneurs? Few of us really know. Some have inherited their wealth and are just "clipping coupons", an old phrase for getting the interest payment on bonds. Some have invested in stocks, but how many were original investors? Aren't many "investors" really traders trying to take advantage of the variations of stock prices? About the only social benefit traders provide is liquidity. Some rich people are executives of companies that they didn't create, but have managed by one means or another to gain control, sometimes with disastrous results for the shareholders, employees, and society.
Let's look at the hypothetical entrepreneur to determine what his "fair share" of taxes should be.
Bugs Bunner has forty acres in which he has planted carrots. He starts by plowing his fields all day in the early spring. Then he uses a planter to put in rows and rows of carrot seeds. He spends many a day cutting the weeds down and keeping the deer and rabbits out. Come fall he takes his carrots to market and hopes to cover his costs and make a profit.
One year he finds a carrot variety that keeps well and tastes great even after a year of cold storage. Grocers all over the state seek his carrots out.
Now we get into the first problem of being a self-sufficient entrepreneur. How do his carrots get into the stores? On public roads. How do the roads get paid for? By taxes. What is Bugs Bunner's fair share of the cost of the roads? Is it a share of his income? Is it the cost of his use of the roads? If everything was truly free market, he would pay the owner of the roads a toll for every use of the roads.
Bugs Bunner's carrots are so popular that he buys more land and plants even more carrots. His plantings get so extensive that he can no longer do all the work himself. He has to hire farm laborers. How much will he pay them? It partly depends on the supply of labor - low supply, high wages; high supply, low wages. Let's suppose there is a high supply of labor and he pays low wages.
Will he pay enough for decent housing, for health care, adequate food, and so on? If not, who pays for making sure the needs of his work force are met. Would that be called welfare? Welfare is often paid for by taxes. How much of these taxes should Bugs Bunner pay?
If he requires literacy in his laborers, who pays for them to learn to read? Their parents? But if the next generation of his laborers are the children of his current laborers, can the parents afford to pay for their children's schooling? If the parents can't afford to pay for schools, then the government will have to pay for the schools. Guess what? This requires taxes. What is Bugs Bunner's fair share of these taxes?
On and on it goes. Until we recognize that "no man is an island unto itself", we will continue to argue what a fair share of taxes is.
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