The recent conversation over the past could of days has brought out some thoughtful comment – so to those of you who have contributed to the discussion, many thanks.
The problem that I have is that I tend to agree with both opposing viewpoints to a degree. This could just mean that I’m a little schizophrenic, or it could mean that there is no straightforward solution. I rather favour the latter explanation. The libertarian viewpoint is that tax is an evil. It is stealing someone’s money to pay for something that they might not otherwise spend the money on if left to themselves. Far better not to have it and allow people to form charities and mutual associations should they so wish. Monoi pointed us to the pre-WWII society, although more accurately, pre-welfare state. Here, again, I encounter a conundrum. On the one hand the evidence is all around us that the welfare state is delivering an unexpected consequence. On the other, I understand the thinking that led to it. I still feel that the safety net principle is the right one – and I dispute that this means I have a negative view of people. It is realism that says that someone, somewhere will look after that, while doing nothing myself either because I don’t have the money myself or I am too preoccupied to be involved. This isn’t misanthropy, it is realism. We become wrapped up in the daily grind and isolated from the problems faced by others. Sometimes it is when you face them yourself that those problems come into sharp focus. For me, this has not only happened, but the Byzantine bureaucracy and pettifogging hurdles were something that I could only imagine beforehand.
Is my experience a case against the welfare state? Possibly. Would a mutual society have looked at my situation and taken a pragmatic, case by case view, realising that my house in France was not an immediately realisable asset and was, in fact, a cost? Maybe. If so, it strengthens the libertarian argument. But how can we be sure that such an organisation would spring spontaneously from the corpse of the welfare state? And, importantly, who pays? Will that philanthropist step forward? Maybe. But is maybe good enough? Can we rely on maybe when people fall into difficult times?
It doesn’t matter how much we may be individuals desiring individual responsibility – and you can count me in that thinking – there will always be collective needs. The obvious two are defence and law and order. The cornerstone of libertarian of thought is the rule of law. Again, count me in. However, for that to work we need police, judges and a system of courts. This costs money. Who is going to pay? Well, who benefits? We all do, so logically we all pay. The same applies to defence. If we wish to maintain our security, we need a standing army. Again, who benefits and who pays? If we are all to put a little into the pot for these collective needs, then there has to be a system of collection. Call it what you like, you have just invented tax – and if someone wishes to live in your society but doesn’t want to pay for the justice system or the army, what are you going to do? Well, I suppose you could eject them. Otherwise, you have to have some sanction. Well done, you’ve just invented the HMRC.
There is much that government does that, frankly, it shouldn’t. Which is why we are taxed at around 50%. This is an obscene amount and the best way to cut it is to savagely slash government spending. I recall reading somewhere that New Zealand did something like this about twenty years ago. The public sector activities were hived off to the private sector. The people involved still did those jobs that were needed, but those who didn’t want or need the service were not obliged to pay for it through taxation – the customer paid. For much of the activity that government now involves itself in, there is no reason why the same could not apply here.
Some activities we all want and need at some point in our lives – and healthcare is the obvious one. I have no ideological objection to private companies providing the care and making a profit. However, a civilised society will make provision for everyone not just those who have the wherewithal to pay directly or through insurance. Making a profit concentrates the mind when it comes to efficiency. The same could be said for such activities as driver examination. We already have parallels in other fields of endeavour where private organisations deliver training and then bring in someone else to provide independent assessment. Such a system is more customer focussed and can be used to ensure that sufficient evidence of competence is demonstrated before sign-off; something that is nigh impossible with a twenty minute drive around.
These are just random thoughts about where government should relinquish its grip. However, that doesn’t mean that I feel we should have no government. A central organisation is the ideal candidate for standards setting, for the collection and distribution of funding – because, like it or not, we will always come across situations where we all want something that benefits the collective that needs provision and money to pay for it. Call it evil if you like – I have often enough. But I recognise, deep down, that it is a necessary evil. But like all evils it needs to be caged and tightly controlled. It is that lack of control – or accountability that has allowed our state to balloon out of control and ooze its way into the very fabric of our lives.
Longrider has made a very good case for more than minarchist government: a view with which I agree.
However, as there will then be government functions beyond the minarchist ones, we have to have good means of limiting what is provided by government, so that an adequacy of value is obtained for the taxpayers’ money. This is on both what type of things are provided (eg healthcare and education) and the more detailed decisions on how much of those are provided ‘free’ by government (eg probably not tattoo removal and probably not tactics for Monopoly and other board games).
That is the problem. It is still the problem, having recognised its existence.
Boundaries must be set and hard decisions made: not everyone will agree, so there must be compromise.
The current compromise is too expensive and offers too little value for money. We are going bust because of it.
Best regards
The experiences of New Zealand were discussed in another blog post last year (sorry, can’t remember which…), but one commenter said that this downsizing of government didn’t last too long, and within a few years things were pretty much back as they previously were.
I can’t personally confirm this, it was just one reply. Perhaps one of your readers could give an update?
Yes, that sounds familiar. Trouble is, I don’t recall where it was either. Unless you bookmark everything of interest, these things have habit of dropping off the radar.
How about shrinking the state even beyond NZ levels to the point where it can get by on voluntary taxes? Tax would lose the legalised theft aspect if it was avoidable, so no income tax or sales taxes on essential items, but there would be GST/VAT on non-essentials, stamp duty on all but the first house purchase, sin taxes (at reasonable levels) on certain goods and so on. If you really wanted and were prepared to have a fairly austere existence you could pay no tax at all, though realistically most would choose lifestyles that meant paying a certain amount of tax. The government would of course have to learn to live within the reduced means that this would result in, but I’d say that’s not actually a drawback.
That’s the national government I’m talking about. Local government could perhaps still raise taxes their own way – local income, sales, payroll, LVT, whatever. Residents and businesses who didn’t like it could relocate and local authorities who take the piss would eventually find themselves without much of a tax base and fewer people needing the services anyway.
By the way, I bookmark everything that interests me and I’ve now got so many damn bookmarks it’s quicker to google than search through them all. I think I need to spend an afternoon sorting them and maybe switch to a browser which allows tags with bookmarks.
Just how many levels of govt do we need that do the same thing?
Here in the USA, we have local health depts,state health depts, and several federal depts that do the same basic things.
The same is true with wellfare and education.
All of these depts are funded by the taxpayer.
Most of these programs(education and healthcare) could be run at the state and local level with ZERO need for federal involvement.
This would be a great lowering of cost to the taxpayer.
That would be a feature, not a bug 😀
Gary K – in general, the more localised, the better, frankly. In the UK, that would be county level, I guess. Part of the problem with our NHS are the layers of bureaucracy.
Government per se, not just in Britain but globally has grown too big, it has gorged itself on the milk n honey of private enterprise combined with mortgaging the children grandchildren and great grandchildren of us all via profligate unchecked and aye even wanton borrowing;
instead of focusing on cuts we should be focusing on what to keep. we should draw a simple list of what Government should actually and ONLY be doing;
i.e.
Defence
Health n Welfare
Transport Infrastructure
Criminal Justice
Energy Supply Security
Basic Civil Service
everything else is superflous unwwanted and unneeded and should just not receive funding; it will either survive via charitable funding or be taken up by private enterprise and would thrive or wither depending upon the law of supply and demand….SIMPLES…
I read once recently during some research I was doing that at the height of the British Empire in India in the late 19th Century that the civil service (administering to a population of over 300 million in India) only yes ONLY needed 1,200 civil servants with a handful of Commissioners overseeing their activities…and all at a time when there was no telephone, no internet, no cars, only the telegraph, steam boats and steam engines and the horse n cart!
If the Victorians could do it, without the marvel of moder instant electronic communication, why can’t we?
Gratifying to see other people thinking the way I do on this – I believe that if education and health were organised at say county level, with proper scrutiny (bloggers, the press, general transparnecy) then national taxes could drop to around 10% or less.
The problem is I can see no way to get from where we are now to where I’d like us to be – it would be too radical a departure.
Think what you will but I reckon that on these issues the tories are probably playing it about right.
They’re obviously getting a lot wrong as well such as europe and defence, but on health and education and benefits they are unquestionably making the right sort of moves even if the politics is a bit cack handed at times (lansley!)
Let not the best be the enemy of the good.
Andy Baxter @ 7
You’ve missed something.
There are a minority of the population, who will use any loophole to exploit others. And not necessarily in an obviously “criminal” way.
Their activities fall between the stools of real Health & Safety and criminality.
I’m especially thinking of food safety, weight-and-measures – that sort of thing…..
The US poster also had a valid point.
You don’t need multiple layers of this.
ONE national, or a single set of local-level organisations covering necessaries is all that is needed.
If you really want an example of the opposite – how NOT to do it, then look no further than the EU, which is trying to INCREASE it’s take from all of us, just as we are trying to economise.
Being libertarian does not mean being against all taxes. Not in my view anyway.
There are things such as defence and law and order which have to be administered by the nation. As you correctly point out, a fact forgotten by most anti-libertarian because they confuse it with anarchy, a libertarian society can only work if the basic rule of no aggression is followed and a strict enforcing is in place. Not something that can be said to be accomplished by the current model of government.
Education and health could also be considered as part of a government’s remit, but I think that in the case of the former, it should be seen more in terms of setting national standards and it follows that you do not want the same body to provide the education to attain those standards because of obvious conflict of interest. Something which has been amply demonstrated by governments in the last decades. Funnily enough, the current government is trying something of the sort, with academies and free schools, so there is hope. Unfortunately, I worry that like most of half hearted measures, it might be too marginal to offer real hope but let’s be optimistic.
Health is more problematic, because there has to be limits to what can be done otherwise the system falls under its own weight as we see nowadays. There is also the fact that something which is free will be abused. My wife works for the NHS, in a nuclear medicine department where doses of material have to be prepared everyday for patients booked for tests. Those doses only last 1 day, and have to be discarded if not used. It is amazing how many are thrown away because of no shows. The NHS still pays for them though, and the people who have not turned up do not suffer any consequences although their behaviour has resulted not only in a waste of money, but also in not allowing someone else to have their test done earlier. She managed to get her department to hire someone to manage this and reduce wastage, but compared to her previous job where she worked in a private clinic and where they had 1 no show over 2 years, there will still be waste. I know it is an anecdote, but multiply that by every department, and it becomes a real problem. But because it is the NHS, one cannot say anything to the patients! See also the difference between the principles of the NHS at its inception and now, where it is telling us what to eat or not to smoke.
The conundrum is how to set boundaries to the size of the state, bearing in mind that the raison d’etre of any bureaucracy is to grow itself first, before providing the service it is supposed to do (remember the yes minister episode where they build the hospital?). What you are experiencing now in your dealings with the state is a demonstration of that.
Before the welfare state, there were mutual societies, friendly societies, whatever else. The railways were built privately, all the large hospitals were built through subscriptions or benefactors, etc…, to the standards of the time (important that, because standards evolve, what is important are the principles), and contrary to what the state propaganda has been saying for the last decades, it was not the jungle.
As Bastiat said (from memory): “the state, that great fiction where everyone wants to live off everyone else”.
Interesting discussion! 🙂
This is proving to be a high quality discussion, for which, thankyou all. I also find myself in agreement with what you are all saying here.
On the health issue, I think that while it might be appropriate for the taxpayer to provide funding, I would prefer that service provision to come from a different body. This, I suspect, would go some way to reducing the wastage. Also, I see no reason why people who fail to show shouldn’t be charged for the lost time and resources – your dentist will do that. As a driving instructor, I used to do it.
I do see a role for government – or a government agency for standards setting as any professional qualification has to be standardised or it is meaningless. Anything that required assessment or examination would fall into that remit – a national set-up for setting and reviewing standards. Private bodies can conduct training and they can also conduct independent examination or assessment, with the national body conducting external quality assurance. It already happens so that would merely be widening the remit. I see Greg’s point about H&S and weights and measures falling in this area – again, national standardisation, but everything else is left to local/private entities for delivery.
The government would of course have to learn to live within the reduced means that this would result in, but I’d say that’s not actually a drawback
Angry Exile – but it wouldn’t be the government living within ‘reduced means’, it would be the electorate putting up with few if any public services and having to make private arrangements to do what the state previously arranged through taxation. And that is why your vision for a minimal state is never going to happen unless it is forced on people at the point of a gun. We have ‘bigger’ government because people have chosen it through their voting choices over the last 100 years.
Before the welfare state, there were mutual societies, friendly societies, whatever else. The railways were built privately, all the large hospitals were built through subscriptions or benefactors, etc…, to the standards of the time (important that, because standards evolve, what is important are the principles), and contrary to what the state propaganda has been saying for the last decades, it was not the jungle
No it wasn’t a ‘jungle’, but it had serious problems which lead to reforms which lead to the state playing a much greater role in orchestrating and providing public services. I think the mistake that you and most people on this thread make is in seeing ‘the state’ as some kind of thinking organism that is bent on increasing itself, whereas in fact the growth of the state has largely been in response to voter intentions. Case in point, the growth in CCTV, the attempt to introduce ID Cards, overweening terrorism acts, have been responses to public fears, and which is why I support democratic government limited by a strong bill of rights. Most of these policies I disagreed with and actively campaigned against, logging many hundreds of hours on a NO2ID stand over the years. But it would be a mistake to see these things as a conspiracy by a state bent on increasing itself.
I don’t think it is a “thinking” conspiracy as such, as in having been planned. But I think that once something like this starts, it will be hell bent on getting bigger whether it is necessary or not.
It might also be democratically elected, but democracy has never meant to be the same as the dictature of the majority (which is what smokers are experiencing nowadays).
I also think that most of the welfare state started after WW2 (started, lest we forget, by statist regimes) when for some reason, communist ideology was thought of as good.
Anyway, who really knows?! My basic point is that it could hardly be worse than the system we have now.
It might also be democratically elected, but democracy has never meant to be the same as the dictature of the majority (which is what smokers are experiencing nowadays)
The sort of democracy I favour tempers the dictatorship of the majority by a bill of rights, which ensures that fundamental rights are not subject to being wished out of existence by a simple majority.
I also think that most of the welfare state started after WW2 (started, lest we forget, by statist regimes) when for some reason, communist ideology was thought of as good
The adoption of the welfare state in Britain was accelerated by the Second World War, though elements of it were foreshadowed by the governments of the 1930s. It had absolutely nothing to do with idolising Communism. Quite the reverse, in fact, as it was seen as a way of neutralising the political threat from Communism and more radical forms of socialism.
The article about New Zealand was on The Devil’s Kitchen. One of the commenters did say that it was back to size within a few years. Go to his blog and search for “New Zealand”
Re: New Zealand – the DK post is here.
It took a fair while to get back to (sort-of) square one in NZ. The Labour Govt (incredible, isn’t it) that conducted the slash’n’burn was elected in 1984. The big re-growth wasn’t really until the Clark-led Labour Government of 1999 – 2008. No real sign that the current National government has similar intentions to former Labour minister Sir Roger Douglas (pbuh), but they have essentially followed their manifesto promises in this. Election in November this year, so who knows what will be in the manifesto this time. Labour certainly look to be toast.
It does seem sometimes here now that there’s a ministry for absolutely everything. There’s only four and a half million of us, for goodness sake.
And that is why your vision for a minimal state is never going to happen unless it is forced on people at the point of a gun.
Well it’s true that I’m not certain how to get there from here but to have a government forcing people not live under the threat of force by the government seems counter-intuitive. The tax and spend policies now are forced at gunpoint.
Realistically I can think of two possibilities. The first and I think best is that being bribed with your own money just goes out of fashion and people begin to vote for parties that offer the electorate their freedom back again. That’s the one I dream about. The second, and I think far more likely, possibility is that the whole house of cards comes crashing down and everyone is no longer able to keep up the pretence that the state was a money factory and knew what it was doing, resulting in scenes that make the Greek riots look like a picnic. That’s the one that keeps me awake at night. 😉 I suppose if that happened it would still be forcing the alternative on people, but rather than a gun it would be circumstances doing it.
The first and I think best is that being bribed with your own money just goes out of fashion and people begin to vote for parties that offer the electorate their freedom back again
But the majority of people do not consider it to be ‘freedom’ to have to make private arrangements to get their garbage collected, or law and order or for basic health care. They think that these are things that should be organised by government for the people.
The second, and I think far more likely, possibility is that the whole house of cards comes crashing down and everyone is no longer able to keep up the pretence that the state was a money factory and knew what it was doing, resulting in scenes that make the Greek riots look like a picnic
This ‘money factory’ canard is a common one in libertarian and small state conservative comment. I think people are well aware that there isn’t a ‘money factory’ but they may well take a different attitude to you as to how the collective wealth of a country is deployed to benefit the people as a whole. Without a relatively strong democratic state we would have rule by wealthy oligarchs. Given the choice between the two, I’d rather be ruled by the democratic state than the oligarch.