Taxation through the Ages

Joseph Sobran

In the summer of 1965, when I'd just finished my freshman year

in college, I was reading a little book called THE LAW -- a long
pamphlet, really -- by thenineteenth-century French legislator
Frederic Bastiat, when I was riveted by a single sentence: "Look
at the law, and see if it does for one man at the expense of
another what it would be a crime for the one to do to the other
himself."

In Bastiat's view, government, beyond the strictest limits of

justice, became "organized plunder," a device by which
"everyone seeks to enrich himself at the expense of everyone
else." In other words, government itself tends to become the
very evil it is supposed to prevent: crime. But it confuses people
because it enacts criminal acts under the forms of law.

The simple insight rocked me. It upset my faith in my country

and its basic justice. If Bastiat was right, the United States was
already profoundly corrupt. It took me years to come to terms
with this idea. Today it seems to me almost self-evident. I
marvel that anyone with common sense thinks otherwise.

This means, for openers, that taxation is a gigantic system of

fraud, robbery, and extortion. Most taxpayers receive nothing to
justify the amounts they are forced to pay. Yet it's the taxpayer,
not the ruler, who is treated as a criminal suspect and required
to "confess" his earnings and holdings. The ruler isn't penalized
for anything he does to the taxpayer.

This fact makes me wildly indignant, and I'm frustrated and

baffled that so few Americans share my feelings. We are being
robbed and cheated on an astonishing scale.

Once, during a radio interview (I've been known to repeat this

story too), I was asked, "Why don't you ever criticize big
business the way you always criticize big government?" I
answered, "I'm not forced to do business with General Motors. If
I do so voluntarily, I get a car for my money. But I am forced to
do business with the government. Every year I'm forced to pay it
roughly the price of a new car. And I've never seen that car.
Someone else gets it."

Bastiat, a devout Catholic, reasoned about the state from a

natural law philosophy. He concluded that the state violates the
most basic principles of natural justice. Once you start thinking
that way, you can hardly avoid thinking of politics as a largely
criminal activity.

At some level, most people know this intuitively. I think this

accounts for the huge popular appeal of THE GODFATHER. We
are all taught that the government is there to protect us from
criminals. THE GODFATHER audaciously reverses our civics
lessons: it shows us a benign master criminal who will protect
us from the corrupt government. This is another sentimental
myth, of course -- unlike real mafiosi, Don Corleone never
extorts "taxes" from shopkeepers in the form of protection
money -- but it has enough truth to seize our imaginations.

But the state's myth still prevails, and we submit. Most

people see nothing questionable about state taxation, and
politicians complacently assume their right
to take our wealth.

Some Oklahoma politicians, for example, are currently in a

tax-boosting mood. They want to raise taxes of all sorts --
income taxes, sales taxes, property taxes, excise taxes, you
name it.

According to the National Taxpayers Union, the average

Oklahoman *already* pays more in taxes -- Federal, state, and
local -- than for food, shelter, clothing, and transportation
*combined.* This amounts to 26.5 per cent of per capita
income.

How much is enough? What is the limit? At what point, short

of taking 100 per cent of our earnings, do our rulers feel they
are taking too much from us?

The obvious answer is that they recognize no limit. The

subject never comes up. They view the taxpayer as an
inexhaustible resource.

And why shouldn't they? The sad fact is that the American
taxpayer is a remarkably passive creature. He merely grumbles
at conditions far more oppressive than the tyranny that drove his
ancestors to rebel against British rule in 1776.
 One of the chief complaints of the American colonist was
that he was taxed without his consent. Yet by today's standards,
his taxes were amazingly low. Precise figures are hard to come
by, but in 1764, for example, the average American was taxed by
the Crown at the rate of sixpence per year. That is not a
misprint. Six pennies per year. One penny every two months.
Even adjusting for inflation, that is a pretty light tax burden.
Today's children pay more than that in sales taxes.

And the British were cautious about raising taxes. Even a

slight tax increase, as on a commodity like tea, could bring the
colonies to a boil.

The Americans knew that a principle was at stake. Unlimited

taxation could mean slavery. That is why they tried, at every
turn, to nip it in the bud.

Under slogans like "No taxation without representation,"

Americans fought for independence and established their own
governments. They thought self-government was their bulwark
against tyranny and overtaxation.

But the problem turned out to be more complex. Even elected

officials found it easy to abuse the taxing power, and self-
government could be as predatory as foreign rule. Senator John
C. Calhoun remarked that the most surprising thing experience
in government had taught him was that it was easier to raise
taxes than to cut them.

The Lincoln administration imposed the first Federal income

tax to meet the costs of the Civil War. But again, by our
standards the rates were amazingly low: the basic rate was 3
per cent, with a top rate of 5 per cent. Even so, after the war the
U.S. Supreme Court soon ruled that a Federal levy on incomes
was unconstitutional.

In 1913 the Federal Government surmounted this obstacle by

winning a constitutional amendment authorizing taxes on
incomes. No upper limit was set, but most Americans were
unaffected. "Incomes" were narrowly defined; annunmarried
taxpayer had to make about $50,000 (in today's money) to pay
the tax at all; and the top rate, a mere 7 per cent, reached only
the very rich. It wasn'tuntil after World War II that most
Americans paid income taxes, but then the rates rose to their
current punishing levels. And in recent decades most states
have imposed income taxes too. Other taxes have also
increased at dizzying rates.

At nearly every step, the government has had its way.

Taxpayers have mounted only sporadic resistance, in what are
often called "tax revolts." The phrase is significant. If our rulers
are really our "servants," as self-government implies, why are
the wishes of the ruled considered "revolts"? Can we "revolt"
against our own servants? Or have they really become our
masters?

The question answers itself. We might also ask, At what point

does taxation become confiscation, theft, and even involuntary
servitude? Our rulers -- we may as well say our masters -- never
address this point. The Ruler of the universe asks only 10 per
cent of our wealth. Our earthly rulers won't settle for such a
modest share. They consider us "greedy" for wanting to keep
more of our own money; they consider themselves
"compassionate" for wanting to take more of it -- 20 per cent, 40
per cent, why not 80 per cent?

If the politicians had any respect for our rights, our property,
our liberty, even our dignity, they would impose taxes only
reluctantly, and they would acknowledge some just limit. They
would act as if the money they take and spend is *our* money,
to be used for the common good of all, and not for buying the
votes of special interests and government dependents. In short,
they would recognize that taxation is a *moral* issue, not a
mere political convenience to be exercisedarbitrarily and
irresponsibly.

I know of only one history of taxation, Charles Adams's 1993

book FOR GOOD AND EVIL: THE IMPACT OF TAXES ON THE
COURSE OF CIVILIZATION. It's not a totally satisfactory book;
the writing is uneven, some of its judgments are open to
question, and the subject is far too vast to cover in 530 pages.
But it's about the only book dealing with the topic for the
general reader, and it's full of fascinating information and
anecdotes, backed by a basic wisdom.

Adams isn't categorically against taxation. He thinks there

are "good" taxes as well as bad ones, and he argues, for
instance, that the Roman Empire fell because it wasn't
collecting taxes efficiently. He blames tax evasion for its
demise, but blames its policies for fostering evasion.

Nevertheless, his narrative makes it hard to deny that

"organized plunder" has been the very lifeblood of most states
throughout history. In most times and places taxation, like
slavery, was simply taken for granted as an inescapable fact of
life; now and then there have been tax revolts, just as there have
been slave revolts; and at times, especially since the Christian
era, taxation has been recognized as presenting serious moral
problems.

Aside from the Roman Empire, Adams thinks states have

usually destroyed themselves through overtaxation. Greed is
almost the defining mark, not of the capitalist, but of the state.
Ingenious rulers have found a thousand ways, from slavery to
debasing money to tariffs to exacting tribute, of appropriating
others' wealth. At the same time, they fail to foresee how their
own oppression will breed tax resistance.

Adams finds abundant records for this. In fact, many

important archeological discoveries have been of tax
inventories. The fabled Rosetta stone is essentially a tax record.
"A large percentage of all ancient documents are tax records of
one kind or another," he writes. "The day may come when
historians will recognize that tax records tell the real story
behind civilized life.... They are basic clues to the way a society
behaves." After reading his swift review of history, you can
hardly doubt it.

Taxation has always been big business, the biggest business

of government. Hebrew complaints about the "oppression" of
the Egyptian pharaohs seem to have been chiefly about the
taxes imposed on them, which often amounted to, and were hard
to separate from, slavery. (The Egyptians were cruel taxers,
even sending scribes into every home to make sure people
weren't preparing their food with untaxed cooking oil!)
Sometimes we hear of taxation so casually that we hardly
notice it, as in the Gospel accounts of Joseph and Mary going to
Bethlehem to submit to a great Roman tax census.

As Adams sees it, history is largely the story of men's

constant efforts to get the wealth produced by other men, with
politics and the state as the main means of acquisition. It's
amazing that this ever-present dimension has been so slighted in
most history books. Men have fought for power for many
reasons, but the strongest has always been their own
enrichment. It's hardly too much to say that the story of axation
is the story of mankind.

Adams sees Old Testament history as the constant struggle

of the weak Jews against powerful predatory neighbors,
Egyptian, Babylonian, Persian, Assyrian, Greek, and Roman.
Losing a war, or avoiding one, meant paying tribute. (We tend to
read words like "tribute" without grasping their concrete
meaning.)

In the often deadly game of politics, tax exemptions and

immunities as well as taxes were key weapons. Exemptions
were irresistible privileges and definers of social class; Islam
owed much of its original appeal to its offer of tax immunity to
converts. This sufficed to lure the great majority of Christians
and Jews in the Middle East, still heavily taxed by the dying
Roman Empire, to the Muslim faith. But in time, Muslim rulers,
having run out of taxable infidels, became eager taxers of their
own people, and Islam lost its zeal even in its own domains.
"Islam ceased to spread when converts were not offered a tax
break." Conversion had become a tax "loophole" that worked
only too well.

In the Middle Ages, struggles between Church and state were

usually over taxes and the authority to tax. Stern moral
limitations inhibited taxation, especially new and "unheard of"
taxes ("exactio inaudita"). Rulers who raised taxes were widely
regarded as wicked tyrants who "incurred sin and would be
punished by God." But churchmen sometimes had greater taxing
powers than secular rulers.

Like Rome, argues Adams, the mighty Spanish Empire finally

broke down because it taxed too many too much and was unable
to enforce its demands on a resentful population. But one of his
most original chapters says that Aztec Mexico fell to the tiny
forces of Cortes because of its own short-sighted greed
intaxing its provinces.

Adams likewise sees taxation, not chattel slavery, as the

issue that precipitated the American War Between the States.
His sharp reading of Lincoln's first inaugural address confirms
this. (He has developed the argument further in another book.)

Only one country, as Adams tells it, has gotten it right:

Switzerland. The Swiss have kept their government under
control pretty well, in great part because they have had the
wisdom to keep the taxing power and the spending power under
separate agencies. He says this practice also preserved English
liberty for a long time, but the vaunted American constitutional
separation of powers overlooked this crucial distinction. The
U.S. Congress taxes *and* spends. So we lack checks and
balances where we most need them. Moreover, the Swiss federal
government can't raise taxes without a popular majority, which
is usually denied. The Swiss taxpayer, unlike the American, has
learned to defend himself.

According to Adams, America's downfall may come gradually

through its failure to control and limit the taxing power. A
nominally "federal" system is in vain when the spending and
taxing powers are combined and centralized. It's at least a
provocative idea; but if his book teaches anything, it's that
Swiss wisdom isn't contagious.

A version of this piece was presented as a speech to the

Oklahoma Council of Public Affairs (www.ocpathink.org) in
September 2003.
Hail Switzerland
Whenever I hear someone brag that America is “the greatest
country on earth,” I want to ask, “Have you ever been to
Switzerland?”

Well, I have. I spent a whole week there once. Very dull. No war,
no international crisis, no crime, none of the things that give life
its savor for red-blooded people like us. Nobody even knew who
the president of the country was. The Swiss have never even
had a great president. Their national hero is still that guy with
the crossbow. Their national pastime is yodeling.

I don’t intend the blasphemous suggestion that Switzerland is

the Greatest Country on Earth, but it has a fair claim to be the
sanest. It has had less history over the last thousand years than
most African countries have had in the last generation. You
know the old Chinese curse: “May you live in interesting times.”
The Swiss have no memory of interesting times. They have a
proud history of not making history.

Switzerland sat out two world wars, for which it is resented by

the sort of people who think war is a duty. The Swiss seem to
feel that the rest of the world can enjoy mutual slaughter
perfectly well without them. They have never joined the United
Nations, NATO, or the European Union. They are content to
hunker down within their sheltering Alps, while Americans will
cross two oceans, simultaneously if necessary, to get into a
good war. Nor do they have troops, battleships, submarines, and
military bases around the world. And no nukes.

In short, the Swiss are what all right-thinking people have

learned to call “isolationists.” They have stubbornly maintained
their independence. As a result, an awful lot of Swiss didn’t die
violent deaths in the twentieth century.

Oh, by the way, the Swiss aren’t afflicted by terrorism. Osama

bin Laden has probably never heard of Switzerland, unless he
stashes his money there. It may not be the Greatest Country on
Earth, but nobody calls it the Great Satan, either.

Not that the Swiss aren’t ready to defend themselves. The men
are required by law to serve in the militia and to keep firearms
in their homes. But when they say “defense,” they mean defense
— not empire, not New World Order, not “global leadership.”

They have a federal system of government, and in Switzerland

federal still, oddly enough, means decentralized. Each canton
treasures its independence. The national president has little
power, little opportunity to achieve “greatness.” The Swiss franc
is one of the world’s most stable currencies. Swiss banks are
the world’s most secure vaults.

Naturally, a country like that, free, peaceful, and prosperous,

isn’t going to be left alone. A few years ago there was an outcry
against Switzerland as a repository of “Nazi gold,” which turned
out to be a scam, an attempt to blackmail the Swiss. They were
given a choice between coughing up billions or facing
international opprobrium and sanctions. It later transpired that
the Nazi gold was mythical, the accusations a cynical smear
campaign.

Independence is always hated by centralizers and

internationalists. The papacy is hated because the Pope, unlike
politicians and journalists, can’t be bought or bullied.
Switzerland is hated because it remains aloof from the
“international community.” I’d offer other shining examples of
resistance to the pressures of internationalism, if I could think
of any.

Switzerland has enjoyed the kind of history Americans once

hoped for. But while America has been drawn back into the
quarrels of the Old World its people had hoped to escape,
Switzerland has in effect managed to secede from that world’s
strife without leaving the continent. If you want excitement in
Switzerland, you just have to roll your own; the state won’t
provide it for you. You can sum it up by saying Switzerland is a
country that has lost more lives in skiing accidents than in war.

The story of Switzerland is the greatest political success story

of the modern world, yet we never hear about it. Why not?
Because it puts all other states to shame. Most rulers want to
Americanize their countries; but if they really cared about their
people’s welfare — lives, liberty, property, and all that — they
would try to Swissify. It’s a sign of the times that I am forced to
coin this indispensable verb.

Joseph Sobran
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