Sunday, October 18, 2009

More of my Thinking on Production and Taxation

Back in August I did a post on the causes of war called We Need A Way Out. I have been doing some more thinking on the subject, and thought I'd share my thoughts, whether you want them or not.

Ever since the era when we lived in caves and swung stone tools man has had to meet certain basic needs (Food; Clothing; Shelter- we started to worry about entertainment when we finally had enough of the other three) not enough of these needs, you were poor; an overabundance meant you were rich. You went from poor to rich by being good at something- hunting; gathering; hut building, tool making (career choices were rather limited in those early days; I’ll bet nobody earned a living as a ‘consultant’); take your pick.

At some point we began to specialize, in as much that I would sew the skins for your tent in exchange for fresh meat. I didn’t have to hunt; you didn’t have to make your own shelter. When I became better at making tent skins than what most people could produce themselves, I would have more work than I could do. Then I could raise my prices, as I became better and faster at my job, so I was making money two ways; I was receiving more for my labor, and I was spending less time doing it. I would have an over abundance of fresh meat and berries, and whatever else my clients could forage. Then, instead of only being able to trade my tent skins for what I needed, now I could trade my excess. I didn’t need to worry if the tool maker needed a tent so I could get a new flint scraper; I could trade my berries.

When each member of my tribe was able to specialize we were able to become richer than the tribes around us, and we could afford to have our toolmaker experiment with new methods and materials for tools, making us even more productive. When we had food in abundance, our population grew, and had the technology to force the neighboring tribes off of land we wanted for our offspring. Our ability to produce did not make us greedy; it was Darwin in action.

This scheme has survived 50,000 years. If your tribe had it, and my tribe needed it, we tried to take it. If we did, we became the dominant culture. If we couldn’t; you became the dominant culture. The Romans, The Persians, The Egyptians, The Mayans, The Inca; history is littered with the remnants of various tribes that thrived until they ran into a more dominant culture. Well, except for the Romans; their culture didn’t run into a more dominant tribe; their society just disintegrated from within.

Our technology to wage war became more and more deadly. We weren’t just one-on-one with a stone axe anymore; we had battles where 30,000 were lost at one time. We were able to use technology to destroy 50,000 with one bomb. War over production had to stop.

I’m not going to say the United Nations has done a good job, but it does allow the sham of saber rattling without actual bloodshed. The Cuban Missile Crisis is a good example. The USA, instead of starting a shooting war, was able to take an international stage and declare we were ready to start shooting. The Russians saw the end game and backed down. It was the same old story; they needed the production resources Cuba provided, and were afraid we would use our weapons to deny them those resources. The entire Cold War was fought this way, as the West and the East fought to become the dominant culture.

There are only two types of people in a society; producers and consumers. A producer adds to the tribes riches; a consumer deducts from those riches. That is a little over-simplified, but for my purposes today that will work. Producers want to produce. They want to create wealth, and their production of wealth usually benefits us all. As a Stone Age tent maker I would eventually need to have help, spreading my wealth. Today the busy rich man still hires help to accomplish the work he has been hired to do. Recently we have been expanding the consumer class, as an effort to limit production. As more and more people are moved from producer to consumer we have been able to produce less, limiting both our need for more resources and markets, and limiting our ability to expand, because we lack the necessary resources.

The way to stop fighting over production, resources and markets is to limit the ability to produce. When production is lowered we have less use of resources and less need for markets. The American government has been limiting production for 40 years by taxation, the welfare state and environmental controls. The American public has adapted and become more productive as a result; the opposite of what was intended.

So now what? First it was the resources they are starting to limit, by controlling things like oil production. Oil is not a finite commodity; “Experts” have been predicting the end of the oil supply since the 1920’s. (See here for more detail.) It is the monopoly on oil production that has increased the price, not its scarcity.

Now the governments are starting to tax the producers more heavily becaus ethey produce, hoping to limit their production. The Kyoto Protocols and the Cap and Trade legislation is how this is to be accomplished. It is practically impossible to produce anything without waste, and in an age when 90% of what we do produces carbon waste, taxing carbon by-product production is seen as an easy way to limit production.

But the people are beginning to see through the sham. Producing is what makes us able to earn our living, and limiting that ability makes us poorer, both as individuals and as a culture/society. We don’t want to be poor- struggling for our crumbs; we want to be rich- having enough to store some of our riches; just like our Stone Age ancestors.

Government was meant to be an aid to production, not a restriction. Government does not produce, it consumes. Except for very, very limited examples, government workers in a none Collective Societal setup do not produce a product that could be considered viable for a private company (the Parks systems are one of the few) and most of those few are the result of government regulation (think Bureau of Motor Vehicles). How long will we accept such poor help from what should be an aid to our goals? Not much longer, if the Tea Parties are any indication.

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