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Dominic Frisby (History Of Taxation Provides Insights To The Future Of Taxation And Freedom)

Rebel Capitalist Show

Every Single War Is Made Possible By Taxes

If there were no taxes. You could not have war because there would be no means for paying for it. – Dominic Frisby

According to Dominic Frisby, author of a new book, Daylight Robbery: How Tax Shaped Our Past and Will Change Our Future, debt is a tax on the future, and either taxes are collected during the war, or taxes are collected later in the form of debt.

Why is debt a tax? Because debt will be paid back as some form of tax in the future. Of course, governments prefer to inflate their debts away. So whether taxpayers actually get paid back in real terms remains to be seen.

Tax Makes War Possible. War Makes Tax Possible.

Every war requires the imposition of new taxes that would have not been viable during peacetime. Only a crisis gives politicians the possibility to impose and raise new taxes.

Revenue Act of 1942

In America, the 1942 Revenue Act brought income taxes to every man. Prior to 1942 income taxes were only paid by the richest Americans.

Increased individual income tax rates. Corporate Tax. Increased corporate tax rates (top rate increased from 31% to 40%). … Created 5% Victory tax on all individual income over $624, with postwar credit.  –

There was a massive campaign to fund the war. Cartoons of Donald Duck paying his income tax.

Artist paid to propagandize

Irving Berlin was commissioned to write a song. It has lyrics that say,

“…I paid my income tax today…A thousand planes to bomb Berlin…They'll all be paid for and I chipped in…That certainly makes me feel okay…”

Was there ever a better link that connected war to taxes than that line in those lyrics?

There’s Nothing More Permanent than a temporary government program…or in this case a tax.

What often happens, after the war has passed, is that the taxation or the controls NEVER return back to pre-crisis levels.

They Stay…

Who imposed the first income tax?

Abraham Lincoln in 1862 for the Civil War. It was abandoned in 1875. It went away. The only time in history.

Taxation Is A Measure Of Freedom

Think about it. How much of his own labor does a man own? The ordinary worker doesn’t own that much of his own labor. Even in the ‘free country's like the United States. It’s worse in Europe.

Take the first extreme case, look at North Korea or some totalitarian state. The workers own none of their labor. It’s all taken and owned by the government. Slaves (yes they still exist) don’t own their own bodies, let alone their own labor.

The opposite extreme case, where you have anarchy and there are no taxes at all means total freedom.

Social democracies sit somewhere in between those two extremes

The Greatest Countries

Look at the most successful, the most innovative, the most inventive, the greatest countries in history, the greatest societies all started out with low taxation compared to their GDP.

Hong Kong, the great economic success story of the 2nd half of the 20th century, taxation as a percentage of GDP never exceeded 14%. Only the very rich paid income tax. Anyone below the super-rich in Hong Kong kept all of their labor.

The tax system was centered more around taxing the value of land, than labor. That’s a very different society that you create.

Make sure to catch the full interview by clicking the play button above.