How to fund the state?

I am an anarcho-capitalist at heart, but from a pragmatic viewpoint, I am still a minarchist. But seeing coercion and economic intervention as bad, I have been wondering how funding a minarchist state would be possible.

I have been toying with the idea of voluntarily funded state programs. This would allow even things like social security for the disabled, etc.

Any thoughts on that? Or perhaps alternative funding methods that would still be minimally intrusive?

This may be a matter of semantics, but if a state is not funded by coercion - if it is voluntarily funded - isn't it no longer a "state?" At that point, isn't it a club, or group, or business, association, organization, institution, alliance, etc.? Isn't it simply an anarchistic society or community, since it is voluntary? And since it is voluntary, it would not be able to enforce it's decisions on anyone who did not volunteer to participate.

I agree with Mike. However, here are some good sources:

http://rebirthofreason.com/Articles/Younkins/Funding_Government_Without_Taxation.shtml

http://www.aynrandlexicon.com/lexicon/taxation.html

http://forum.objectivismonline.net/index.php?showtopic=11060&st=0

http://www.saint-andre.com/thoughts/bp.html

http://rous.redbarn.org/objectivism/writing/PeterSaintAndre/VoluntaryGovFinancing2.html

http://objectivistcenter.org/showcontent.aspx?ct=453&h=42

Voluntary funding could enable some local government, but it would not support the State.

Minarchism is a result of rightwing libertarians still being bourgeois. It was 18th century aristocracy that came up with this definition of legitimate governance after all. Why should government be forbid to distribute health care but be allowed to distribute death? Violence is held to be a good of a higher order than any other; it is called "Law" and is accessible to only a privileged few.

You can't voluntarily fund something that is inherently voluntary.  The problem is people have a natural tendency toward thievery.  There is a demand for the government, because people see it as easier and more desirable sometimes to use force to get what they want than to pony up and pay for it themselves or possibly not get it.  Impatience, time preference.  That's really all it is.  To some extent this may be understandable, like say the case of a mother whose child is sufferring from a horrid but rare disease for which there is no cure and no major demand for one.  So, likely nothing in her time to save her child.  And sure, over time we may accumulate enough capital that someone some day may cure the disease, but that's hardly going to comfort her.  So, go to the force peddlers and get people to pay for it whether they want to or not.  Same thing for preserving things like wetlands, the tundra, woods, etc.

The major failure with anarcho capitalism is not ideological but practical.  Ideologically it's beautiful and the ideal world.  But in reality people like using force to solve problems.  What's more convenient, bargaining with your neighbor so he doesn't pain his house some horrid color, or going to a town board which may give you what you want, along with others who want the same thing, much more quickly and cheaply, or at least apparently cheaply?  The thing with the rules the government sets up is that if you're not likely to break them and get caught the opportunity cost to you for them being there and enforced is not high.  Non marijuana smokers don't care much about the issue because they're not going to get locked up for it; they don't smoke the stuff.  People who paint their houses normal colors and have normal sized families don't care about zoning laws that restrict such options.  Hell, they like them.  Takes the mutant out of the picture so they don't have to deal with them personally.

You're not going to voluntarily fund anything like a state because its nature is involuntary.  It exists for the expressed purpose to use force to get people to do things they might otherwise not do, or only do for a price which seems relatively high to the people who desire the outcome in question when compared to what they're giving up of their own resources, including opportunity cost, when using the state.  To some people in their judgement it's just cheaper to go to the state to get what they want.  They don't care about the freedom they give up, likely because it's a freedom they don't think they're likely to exercise in a way that would bring them into conflict with the state.  And they certainly don't care about other people's freedom they're giving up because that's the point in the end.  A voluntarily funded state is like a voluntarily funded mafia.  It's a contradiction in terms.

By definition a state has a monopoly on the law. That means it funds itself through expropriations, since no one can challenge this claim with an alternative arbitrator. So even if the constitution says that the state is forbidden from raising taxes, it can still legislate monopolies and other privileges and sell them to earn income.

This is where it pays to know history. In the 17-18th century, when the state came into existence, the kings would look for all sorts of legal loopholes to earn more income. That included things like establishing a monopoly on minting (followed by inflation of the currency), or selling monopolies to private parties, and so on. The point being that once an institution has a legitimate monopoly on the law, the temptation to exploit it for gain is overwhelming. 

Nock has some ideas about this, in reference to Jefferson - the basic idea is to stop thinking top down, as we've all been conditioned to think, and start thinking bottom-up - this is related to the standard and accepted minarchist principle of subsidiarity (emphasis mine):

The common view of Mr. Jefferson as a doctrinaire believer in the stark principle of "states' rights" is most incompetent and misleading. He believed in states' rights, assuredly, but he went much farther; states' rights were only an incident in his general system of political organization. He believed that the ultimate political unit, the repository and source of political authority and initiative, should be the smallest unit; not the federal unit, state unit or county unit, but the township, or, as he called it, the "ward." The township, and the township only, should determine the delegation of power upwards to the county, the state, and the federal units. His system of extreme decentralization is interesting and perhaps worth a moment's examination, because if the idea of the State (an entity intent on performing positive interventions) is ever displaced by the idea of government (an entity which restricts itself to performing negative interventions), it seems probable that the practical expression of this idea would come out very nearly in that form.²³

23. In fact, the only modification of it one can foresee is that the smallest unit should reserve the taxing-power strictly to itself. The larger units should have no power whatever of direct or indirect taxation, but should present their requirements to the townships, to be met by quota. This would tend to reduce the organizations of the larger units to skeleton form, and would operate strongly against their assuming any functions but those assigned them, which under a strictly governmental regime would be very few – for the federal unit, indeed, extremely few. It is interesting to imagine the suppression of every bureaucratic activity in Washington today that has to do with the maintenance and administration of the political means, and see how little would be left. If the State were superseded by government, probably every federal activity could be housed in the Senate Office Building – quite possibly with room to spare.

So under this view, taxation would exist, but the taxing power would be restrictied to the level of government most proximate to the people, and those levels less proximate would need to come, hat in hand, to beg for operating expenses. This is the ONLY configuration of minarchism that I think *might* be workable, IFF a rock solid wall could be erected which ensured for all time that the taxing power could NEVER move beyond the township level. But I am by no means convinced that there is any scheme that could ensure this, especially for a long period of time which included economic and military crises, which is why I lean anarchist.

Read "The Myth of National Defense" and you will be well on your way to being a pragmatic Anarchist.

http://www.mises.org/etexts/defensemyth.pdf

Unless that is you don't think A-C could occur during lifetime but minarchism could, which in that case if Minarchism could be implemented, so could A-C.

As with regards to your question voluntary donations have been suggested as a possibility for a Minarchist as to how pragmatic that would be is debatable. In addition I believe this is a ripe path for corruption and influence under the Elite. if the Elite are the ones who are the main financial contributors to the State, then the state will find some means to expand in order to further the elite's interests. To restrain the state is virtually impossible. It cannot be done. A vigilant population cannot do it (as successive generations lose the zeal) and a piece of paper is just as useless. The existence of Minarhcism is utopian and the opposite of pragmatic, as it will only grow and grow...

As for other minimally intrusive alternative funding methods....a

Wasn't Athens and most of the other Greek city states funded through voluntary contributions? The liturgy was sort of coerced in that wealthy citizens were pressured into contributing to the common good. But I believe it was still essentially voluntary. I know I'm ignoring tribute payments; but most of the Greek city states didn't receive tribute, and Athens didn't receive tribute in it's early years.

BTW the Romans really liked the Greek system of having the wealthiest people in town pay all the expenses for the entire town - except for the voluntary part. 

I'm sorry, this is too important for me not to nitpick about. 

In the 17-18th century, when the state came into existence

Wait a second. The state didn't pre-exist the 17th century? Pre-17th century, the world was essentially anarchic? Really? Since when? It seems to me that there have been states in various forms for thousands of years. The modern state may have come into existance then, but surely the history of state power goes back much further then that. Much much further.

ozzy43:

Nock has some ideas about this, in reference to Jefferson - the basic idea is to stop thinking top down, as we've all been conditioned to think, and start thinking bottom-up - this is related to the standard and accepted minarchist principle of subsidiarity (emphasis mine):

I can see your point, but the state is a top down construct.  The market is bottom up.  One can't be the other.  Once you have a voluntarily funded organization it does cease to be a state, because the essential feature of the state is force.  That's not to say similar functions the state claims to serve may not be provided privately, but once you're not compelled to pay for them or comply with the rules of doing business with them even if you don't want to do such business, you're not dealing with a state.   You're dealing with Wal Mart.

Government can spend $100 billion every year, more than enough. So every person can voluntary fund $500 every year. We don't need taxes. I heard that the government owns approximently 50% of our land. The government can make money by selling the land.The government can fund itself for 100 years by just selling its land.

The most just (or rather least injust) method of funding the state would be through subsidy, as they did in the Middle Ages. The king didn't have the power to tax without the consent of his subjects, and so had to gain their approval by righting their grievances before they would allow him to tax them.

libertarian:

Government can spend $100 billion every year, more than enough. So every person can voluntary fund $500 every year. We don't need taxes. I heard that the government owns approximently 50% of our land. The government can make money by selling the land.The government can fund itself for 100 years by just selling its land.

 

Couple problems with that.

Its still a tax because its decided upon arbitrarily by one party, and its not a ratio of exchange(a price).

What would happen to the people that decided to not give $500 every year?

If the government does take up selling property it will be to fund foreign wars.

I recently joined a fraternal club and learned a little of it’s history. It was created initially to help neighbors who were unable to care for themselves due to illness or age. This was in the early part of the 20^th century.

 

As the State has taken over this function, this organization has moved it’s focus to the sponsoring other charitable causes.

 

I guess the point is that society will take care of these social concerns if the state will let things be.

 

xahrx:

You can't voluntarily fund something that is inherently voluntary.  The problem is people have a natural tendency toward thievery.

 

 

And that's why God invented guns.

 

Try to enforce your minarchist state. No, really. I dare ya'.  

libertarian:

Government can spend $100 billion every year, more than enough. So every person can voluntary fund $500 every year. We don't need taxes. I heard that the government owns approximently 50% of our land. The government can make money by selling the land.The government can fund itself for 100 years by just selling its land.

 

 

This is the best suggestion I've heard - that a minarchist government could fund itself through either selling its land, or, more permanently, selling the rights to the lumber or whatever other natural resources are on that land.

 

This, however, ignores the problem of how the minarchist government came to own so much land in the first place, but starting from where we are now, it might work. 

How about this idea: funding the state through selling of votes.

Say there are 100 eligible voters in a community.  Each eligible voter gets one vote, so that's 100 votes.  Then there's an auction for 20% more votes.  Proceeds from the auction becomes the source of funding of the government.  Voting (by all 120 votes) takes place after the auction is closed.  All government programs voted into existence at this election have a sunset date that is the next election.  It's a voluntary tax on the political junkies :-)  If you really like your pet program, you'd better pay for it through buying votes.  When people realize it's really less expensive to just make things happen through private funding  instead of buying votes and vote it into existence, the government gradually gets replaced by private voluntary institutions.

How about imposing a head tax on immigrants? So this is a combination of immigration reduction and funding of the state.

I know a better one: Eugenic tax = less intelligent individuals have to be enslaved by taxes.

I have to ask - are you serious?

Libertas est Veritas:

I am an anarcho-capitalist at heart, but from a pragmatic viewpoint, I am still a minarchist. But seeing coercion and economic intervention as bad, I have been wondering how funding a minarchist state would be possible.

I have been toying with the idea of voluntarily funded state programs. This would allow even things like social security for the disabled, etc.

Any thoughts on that? Or perhaps alternative funding methods that would still be minimally intrusive?

 

Quote them in a private stockmarket, maybe?

People aren't going to just pay taxes for public goods. However, if the investment had a return, such as with funding the government through actual public quoting of the "full faith and credit" of the government might be one proposal. If faith were lost in the government's ability to government, the value of the stock would drop. That, in turn, would drive people to invest in the government again but only if the government had the credibility to reduce such corruption. And, in general, the government would avoid corruption because, otherwise, their stock would fall through the floor.

Inquisitor:

I have to ask - are you serious?

"Freedom costs a buck 'o five."

-Team America: World Police

 

JimS:

How about this idea: funding the state through selling of votes.

Say there are 100 eligible voters in a community.  Each eligible voter gets one vote, so that's 100 votes.  Then there's an auction for 20% more votes.  Proceeds from the auction becomes the source of funding of the government.  Voting (by all 120 votes) takes place after the auction is closed.  All government programs voted into existence at this election have a sunset date that is the next election.  It's a voluntary tax on the political junkies :-)  If you really like your pet program, you'd better pay for it through buying votes.  When people realize it's really less expensive to just make things happen through private funding  instead of buying votes and vote it into existence, the government gradually gets replaced by private voluntary institutions.

 

 

Wierd, I also had a similar idea, except people buy votes.

But your idea sounds better. 

This is an interesting concept. Like fractional reserve banking, we increase the supply of votes instead of the supply of money.

 

Inflationary polling.