683. What Is the Deal with Taxes? Where Do Taxes Come From and Are They Really Necessary?

Hello, everybody. Welcome back to another episode of the way the world works. Today I want

to talk about everybody's favorite topic, taxes. Well, there's nothing good about taxes.

And they are a people call them like a necessary evil or a necessary burden, because all

the society needs it because without taxes, who would pay for the roads, we'd have no

roads. And there's a lot of hubbub and a lot of fear mongering about it. So let's get into

it. Let's talk about the roots of taxation. Let's talk about why they're one of the world's

worst ideas ever. And let's start with a Benjamin Franklin quote that he wrote in a letter

to someone in 1789. He said, and so the famous quote, in this world, nothing can be said

to be certain except death and taxes. And what he meant by that is those are the two

constants, no matter what happens in the world, no matter what changes for some reason.

Death and taxes are the two inevitable things. And that's unfortunate, but that is the way

it goes, because it seems as though wherever there is government, there is a system of taxation.

And it has always been that way. In fact, taxes have very ancient roots, which we'll get into

right now. A lot of times you'll hear, let's go back a little bit first. A lot of times

you hear this that like taxes are the sacrifice we all make to like live in a civilized society.

And it's funny because when you think about what taxes actually are, it's not really

civilized at all. But people have just gotten this mindset that it's the price we pay, right?

That's how we live in a society without them. Everything would just go, you know, unravel

and there would be chaos. But what is taxation really? So if I go to my neighbor's house with

a gun and I say, you know, stick them up, give me your money and I rob them. That is robbery,

right? You could call the police. If it was your house, you call the police and you could

say, oh my goodness, I'm being robbed and the police would come and they would arrest the

person robbing you because it is generally seen that theft is a crime, right? I mean, if we look

at constitution and the foundations of it, life, liberty, property, well, property means you have

a right not to have your stuff stolen. Don't take other people's stuff. So that is just a given.

I don't think there's anybody who would say make a blanket statement that stealing is okay. No,

of course you're going to hear nuances. Like, well, what if you're hungry and you steal a loaf

of bread or what if you do the scene? There's there's always I'm just laughing at myself because I

thought back to national treasure one of my favorite movies where he's like, well, I have to steal the

declaration of independence to save it. There always be some justifications. But for the most

far, everyone can agree stealing and taking what it's not yours is not okay. Okay. So I said the

thing about me coming to your neighbor's house with a gun or to your house and taking your money.

So what is taxation then? What taxation is is instead of your neighbor coming to your house

and holding you up a gunpoint and taking your money, they are essentially using the government

to do it. So the government is taking your money by force. Your paycheck is when you get your first

paycheck, let me just tell you your heart is going to break when you see how much money is being

taken by the government for things that you might never even use or things that you morally don't

believe in, like war or, you know, a big welfare state. So it's used, it's stealing money for

things you don't want. But people think that it's moral. People think that it's, it's like a, you

know, at the do's you pay to society and that you tell them it's theft. They'll tell you like,

that's ridiculous. But let's talk about it a little further. So if my neighbor wants a strong

welfare state for whatever reason, they are essentially upholding a system if they think taxation is

okay, where the government steals from my paycheck every single time I get paid, right? And it's like

they, it's like my neighbor is stealing from me, but from a third party. They're just like paying

a third party to steal from me. Now, if you tell them, if you tell people like, yeah, but they're

doing it at a point of a gun, they're doing it by force, they're going to say, that's so silly.

No, it's not. Well, let me tell you, if that's not true, what happens if you don't pay your taxes?

I can tell you what happens. You go to jail and it happens all the time. So we don't have an

option. It is by force. There's really no difference between a robber coming to my house and a

government official, you know, the IRS taking the money out of my check every single time I paid.

And it's, it's so funny because in some ways I respect the robber more because the, the guy coming

to my house or whatever that with a gun, at least as honest that they're stealing from me,

the government will never call it stealing. They'll try to make it sound like it's some benevolent,

some good thing because, oh, it's going for roads. And without taxation, we wouldn't have anything

in society. And it's just like, whoa, that's not really true. And if you look at a lot of major

revolutions, especially in our western way, so in like the tradition of, of Great Britain and the

founding of our own country, what was that point, that boiling point that made people so

furious, they were willing to rebel. It usually came down to taxes and property rights, but

hating taxes is a matter of property rights because your property is your, is your money.

So John Locke, we've talked about him a lot. He's my favorite historical figure ever. You know,

he famously wrote in the second treatise of government, he said that, that when you put your

labor into something and you're getting paid for that thing, the money, that's the fruit of your

labor, right? Just like if you plant a tree and then it grows, you're going to have the fruit.

That's money. Money is the fruit of your labor and you get to keep that and you get to decide

what you want to do with that money. Now, the government interferes in that and that all throughout

history has led people to want to rebel because, you know, like heck, they're going to take your

property and your money and it's very infuriating. And that's how we got the Magna Carta. That's,

we got the Great Charter. It's actually just, it's just Chata. I said it like I'm from Boston.

Magna Carta, not the Magna Carta. There's some trivia I've given you before. It's just Magna Carta.

So that's how we got Magna Carta and go back and listen to the episodes we did on that because

that's my favorite part of history. And that's how we got the founding of America, right? People

were upset about taxes with the Magna Carta. The king kept coming and declaring more taxes and

and taking things that weren't his. And of course, we know that with the American Revolution,

taxation was out of control and they had no representation. There was no consent for those

taxes. And it's just, it's crazy to me. And it's funny because Robin Hood, if you guys know

the story of Robin Hood, you hear about it and a lot of people will frame it as, oh, he was taking

from the rich to give to the poor and you hear that. And to me, I think like Democratic Socialist,

that's socialism. That's terrible. But that's actually not what Robin Hood is about. What is

Robin Hood about? It's about a tax collector that's the sheriff of Nottingham who's working on

behalf of Prince John, which rumor has it is portraying the same king that led Magna Carta to

being signed. But I just read this thing that actually said, well, maybe it's not. So,

we won't say that as gospel truth, but it's fun to think maybe it is, especially if you think

about the cartoon version of Robin Hood where King John is always like calling for his mom and

sucking his thumb and crying. It's kind of funny. Anyway, side note. So Robin Hood is about a

sheriff of Nottingham who was entrusted to collect the taxes on behalf of Prince John and or King

John, Prince John in the movie. And so then you have these people who barely have anything. And the

sheriff of Nottingham is coming and taking the last of what they had and what is Robin Hood doing?

He's robbing the government. He's robbing the king and giving that money back to the people. And

so I think Robin Hood is very misunderstood. And for the parents out there, I know I grew up with

the movie Robin Hood, Prince of thieves. And I watched that back now. And I'm like, this is such like

an individual liberty type movie. Because what did they do when the taxes got too high? They

went in the woods and they built like their own community, a voluntary community. And it's just like,

ah, my brother messaged me the other day. I was like, oh my goodness, this is like a

a liberty, you know, centered movie. And I never understood it before. So fun fact about Robin Hood,

it's not necessarily about robbing the rich to feed the poor. It is the rich, but it's robbing the

government, but you're robbing them back from what they stole. So that's a fun little side note.

So taxes 100% make us less free. Let's be clear about that right away. Because when you have to

implement a rule by force, you're going to have to make the government bigger because you're going

to have to enforce that rule because there's always going to be someone that says, hey man,

don't take my money. Like don't take my stuff. And good ideas don't require force. Remember that.

If taxation was so great and everybody loved it, then they wouldn't have to make it a lot. People

would just do it. And people do do it, right? But it's not taxation. People do give back. Look at

churches. Look at, you know, voluntary charity. That's a beacon or a, sorry, a staple of American

way of life. I said a couple episodes ago how Alexis de Tocqueville came to America from France and

was just like, oh my goodness, there are sense of private charity of helping each other out is

amazing. And that wasn't done through force. It wasn't done through the government was done by

individuals taking care of their own. So if we want to talk about taking care of people who need help,

like what they say, the welfare state is for individuals do it better. And let's talk about

roads now. That is the biggest thing. I remember when I first got into to being political, people are

always trying to challenge me by saying like, well, okay, but you know, if we don't have taxes,

then who's going to pay for my roads? And first of all, communities would bind would bound

bind together, come together and find ways to do that because the income tax was only enforced

1913. So there were ways beforehand to for local communities to do that. And it reminds me one of

my favorite stories that I wrote about years ago. This was kind of a PR campaign, but Domino's

did a thing where his, you know, Domino's they have to deliver pizzas and their drivers are on

the road. And there was this, this thing where they were like, listen, we're going to fix potholes

in the road to make it easier for our drivers. So if you see a pothole in the row, row,

whoa, road, call us and we'll have somebody fix it. And they do think they did fix a couple,

but it was, it was mostly like a PR stamp. But I loved that because they did fix some potholes. And

it's like, wait a second. Next time somebody tells me like, well, who's going to build the roads?

And who's going to fix the roads? I'm going to say, well, literally anybody and Domino's.

And it's funny too, because the government doesn't own a road company or a concrete company

or construction company. No, they're just paying our dollars to hire someone else to do it.

There is no government road builder, right? So it's so silly because those companies would

exist either way. And there's a vast array of ways you could build roads. You know, you could do

it by like your street comes together and says, like, hey, we're going to build this road. And sure,

you as a neighbor could say, I don't want to pay for it. And you probably wouldn't be very popular

in the neighborhood. There'd be natural consequences for that. But you wouldn't go to jail. And that is

the big thing. So, you know, there are, the government is not the only way they do not have some sort

of magical wand. They wave to build roads. And if you've ever been in a construction, like road

construction project or whatever that the government is heading up, it's always complete chaos

anyway. So they don't do it very well. So let's talk about the routes. I mentioned that there are

ancient routes to taxation. And there are, you know, as soon as there have been governments or as

long as there have been governments, there's been some sort of taxation scheme. And Egypt in Egypt,

Egypt, Egypt, this was exactly the same thing. So, but there was like surveillance, right? Because

they wanted to tax as much as they couldn't get as much money from their people, which again,

gave them an incentive to then spy on their people and make sure they were getting every single

dime. So it creates, like I said, bigger government. So they would like come into the kitchens and say,

like, oh, are you using oil? Where are those attacks on that oil? So we need to collect that from you.

And they would do, you know, they would audit and make sure that you didn't get away with not

paying your taxes on anything, which kind of set the precedent for today. So it's, it's so

interesting to me. So not only are, you know, the government, we don't need the government for

welfare for private charity. We already know humans are capable of doing that. We don't really need

it for the road. We definitely don't need it if we want limited government because it grows government.

But let's talk about other things taxation is used for. It's used for war. It's used to fund

endless war because the Pentagon, it has a giant piggy bank that just keeps getting filled by our

stolen, you know, tax dollars and they can do all these things that are very unpopular or that

we are morally opposed to. I don't like that my money is going to fund, you know, the death and

destruction of people that, you know, the people themselves didn't do anything wrong, even if we

have some guff with their government. It's, it's not the people of that place, right? I don't want

to fund wars. And if wars were really so popular, if there was a need for it, then

well, people would probably band together and pay for it. But they have to do it by force because

their ideas aren't good and they're not popular. And so you have to think about that. Why would

anybody try to do something by force? It's because people don't want to do things that aren't good

ideas. And you know, who would fund the needless wars without the taxation? No one. And that's

absolutely great. So it's, it's crazy to me that taxation has become this thing that is seen as

a noble, you know, part of social order when our, our social order as, as Tocqueville noted Alexis

to Tocqueville that we actually have like, we're morally elevated and we're a better people when

we come together as communities and, and, and, and find ways to raise money for what we need or

to take care of people in need. So there's just so many better ways to do it. And that is where when

you look at the government as opposed to free market, like it's no contest, who does things better.

The market just does things better because it, it can actually do things for people. And it

knows what people wants. Government's going to do a government wants to do and they don't really

care how you feel about it, which is why they have to. Still your money. And it is for this very

reason that taxation is included in this headletons guide to the world's worst ideas. And let me tell

you, taxes are just the worst. So, you know, I would like to live in a world where Benjamin

Franklin's quote about death and taxes being inevitable is not true, but unfortunately right now it is.

But we will leave it there for today. If I keep talking about taxation too much, I'll get very,

very angry. So as always, don't forget to like and subscribe to the podcast. And until next time,

guys, I will talk to you later.