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Source link: http://archive.mises.org/4912/the-rocky-road-of-american-taxation/

The Rocky Road of American Taxation

April 14, 2006 by

No modern revolution was deeper rooted in taxation than the revolt of the Thirteen Colonies in British North America, writes Charles Adams. British taxation not only caused the revolution, but perhaps most important, it acted as a unifying force in the colonies. The Stamp Act Congress, as it was called, was the real birthplace of the United States. FULL ARTICLE


George Smith April 14, 2006 at 7:40 pm

Characterizing the Shays rebels as “havenots” does not do them justice. In an outstanding revisionist work, Leonard L. Richards “portrays the Shaysites as Regulators in the spirit of the Revolution fighting a plundering state.” See
for more details.

P.M.Lawrence April 15, 2006 at 4:25 am

Anyone who tries to make sense of these later 18th century developments, not just in North America but also in France, should first become familiar with the mechanics of 17th century interactions in England before, during and after the Civil War and around the time of the Glorious Revolution.

If you don’t do that, you might see the problems as being with taxation in isolation, rather than seeing the interplay of taxes and force – the former to pay for the latter and the latter to collect the former. In 17th century England there was a vicious circle, and also in 18th century France.

In 1688 the threat was headed off because people had learned from experience. In 18th century North America people over-reacted (not realising that Britain was trying to make the colonies more self-sustaining and less in need of financial support from the mother country, which needed to apply central strength to keeping the French menace at bay).

Anyhow, the colonists were not reacting to taxes pure and simple but as part of a larger threat – a threat that they actually increased by rebelling and linking with the French, although as it happened they got away with it. That is, they actually got independence out of it rather than the far more likely “Finlandisation” by France that made Benedict Arnold repent of his earlier disloyalty.

This was a well founded fear, known at the time (google for Chalmers’ “Plain Truth” pamphlet). The Corsicans ended up with the French as a result of rebelling against Genoa; it’s just that the colonists were reacting to 17th century English experience instead of their real threats. Getting away with something is no substitute for knowing what you are doing – and they didn’t.

Any sensible American would have known of the risk of jumping out of the frying pan into the fire. But then a miracle happened – not only did France act with less than 100% self interest, but it also got destabilised the way Chalmers had predicted, so the USA had a generation in which to consolidate.

TGGP April 15, 2006 at 5:16 pm

The revolution was not about “taxation without representation” but just taxation? I guess the bulk of the country just fell asleep when their representatives taxed them later.

Paul Marks April 16, 2006 at 7:12 am

Actually the words “common defence and general welfare” found at the start of Article One, Section Eight of the Constitution of the United States are the PURPOSE of the powers given to Congress they are NOT POWERS IN THEMSELVES.

Otherwise there would be no need (for example) for the power to “raise and support armies” or to “provide and maintain a navy” (both to be found in Article One, Section Eight) as one would simply say “this is spending for the common defence”.

Nor would there be a need for a power to “establish post offices and post roads” (again Article One, Section Eight) as one would be able to say “this is spending for the general welfare”.

To claim that Congress can vote to spend taxpayers money for anything as vague as the “general welfare” (as opposed to the “general welfare” being the PURPOSE of the specific spending granted to Congress) plays into the hands of the collectivists.

They can simply say (for example) “it is for the general welfare of the United States that we have Medicare or Medicaid or Social Security” (or anything else they can think of).

After all everyone was once a child (hence,it will be said, government education spending), if we live we become old, and anyone may become sick (and so on and so on).

Accepting that the Congress has a general welfare spending POWER (as opposed to the “common defence and the general welfare” being the PURPOSE of the specific spending powers granted to Congress)makes the Constitution of the United States a dead letter.

BillG (not Gates) April 16, 2006 at 7:26 am

collectivist will continue to attempt to misconstrue the constitution under the ruse of addressing isssue of social justice unless and until libertarians acknowledge a way to square their concerns within an EQUAL liberty framework where property rights are based on labor not enclosure of the commons without any obligation to the labor-based property rights of those being excluded.

Ralph April 16, 2006 at 12:50 pm

I agree with Lysander Spooner that the Constitution is binding on me only when I say it is binding on me. The Constitution is a contract of “We The People”, who “ordained and established” it. Nothing in the Preamble imposes it on me, especially as I am not a descendant of the signers.

The Libertarian Party recently asked me to run for NC State House, which I did, and I was amazed to see a request for me to “Form a Committee” that would make me provide information on all spending during the campaign.

I checked the handbook given to me for laws requiring me to sign up as a committee and forfeit my 4th and 5th Amendment rights, but no law was given as reference. AFTER I registed as a committee, numerous statutes were quoted holding me punishable for failure to disclose personal information, but no law was given requiring me to register as a committee.

I asked the NC Board of Elections, and they told me “You are automatically considered as a committee if you run for office”.

Am I a committee, or am I a citizen? If a committee, I sign away Constitutional rights which are given to citizens. I cannot be both a citizen and a committee. If I am a committee, then I am not a citizen, and not eligible for election, which would make probably all state governments unconstitutional.

In North Carolina, all candidates are first given a form that “allows” them to sign as a committee, but the form is not a contract between the candidate and the state, as in “I,Ralph____, enter into contract to form a committee”. The dform lists the candidate only as an agent of the committee, similar to power of attorney forms given to represent others in place of their own citizenship.

It seems to me that the entire government is unconstitutional because of this simple practice, and could be legally challenged.

What has this to do with taxes? With an unconstitutional government, all taxes are unconstitutional.

Angelo April 16, 2006 at 8:24 pm

Brilliant and wonderful. I was most happy to see the introductory passage about tarring and feathering tax agents. This absolutely should be a modern practice.

Nat April 17, 2006 at 10:04 am


The revolution was not about “taxation without representation” but just taxation?

Yes. The last thing the founders wanted was representation in London. They knew that anything they wanted would be easily voted down there. Then Britain could come back and say, “Well, you had a voice. Too bad you can’t get your own way.”

I guess the bulk of the country just fell asleep when their representatives taxed them later.


P.M.Lawrence April 17, 2006 at 10:45 am

That problem with being voted down in London was why loyalists proposed workable compromises, even at the first continental congresses. These never reached the point of being rejected by Britain – they were rejected by the faction that ended up rebelling.

In point of fact there were sound reasons for not compromising, but they were abstruse and not easily presented in pamphlets and so on. These were things like the anticipated outflow of silver currency (even though the British had been brought to see the problem and had put in safeguards against it). Another was the likely undercutting of the local establishment, the likes of Hancock et al, which happened within a generation anyway. The big deal is, though, that the struggle for independence was sold on false pretences and embedded by force one position on an unresolved 18th century question: measures or men?

The USA has been struggling ever since with the internal contradictions bound up in the idea of government by laws, not men. It has led inter alia to a faceless government making its own rules and capable of being captured and of capturing, all under the pretence that being impersonal makes it impartial.

Paul Marks April 18, 2006 at 10:00 am

Actually the people in Britian who suggested giving the colonies seats in the Westminster Parlaiment were shouted down.

“It will only be 26 out of 650 odd” “The American Members of the House of Commons will be living here (commuting over the Atlantic harldy being an option in the 18th century) so they will see the larger picture”.

No argument hit home – Westminister would not even give a few seats in Parliament to the Colonies.

Whether it would have worked I do not know – but it would not have needed to win over many Americans (given the number of Loyalists there were anyway) to make the Revolution untenable.

But the-powers-that-be in Britain would rather lose an Empire than allow the Westminster Parliament to stop being a private club.

The same story happened a century or so later.

The ideas of an “Imperial Parliament” (with places like Austalia, Canada, New Zealand and perhaps Indian Princes all represented) fell at the wall of the Westminister Parliament. So the these places gradually drifted away into the farce of the “Commonwealth”.

The joke is that by the European Communities Act (and other Acts of Parliament) the Westminister Parliament gave away its power to the European Union (these days most new laws in Britain come from the E.U. and if there is any conflict with domestic law E.U. law is supreme).

So a Parliament that tossed away an Empire (twice) because it was so keen to guard its exculsive status ended up giving the country as a province to a European empire.

Pathetic – but such are the jokes of history.

On the “labour theory of property” point above.

Well at least it is not the labour theory of value (whether in the version of Adam Smith, the version of David Ricardo, or the version of Karl Marx). So I can not just say it is absurd (and the labour theory of value is absurd – in whatever version it is presented).

However, I am not wildly pro John Locke’s labour theory of property.

What about property that is won by a bet – is this “labour”? Or by inheritance – or are we not allowed to leave property to our children?

Or what about people who have lived in an area (which they took from noone) all there lives without “transforming” it, by “mixing their labour with it”.

For example, people who live in a forest by hunting and gathering rather than slash and burn farming.

Indeed are we saying that a man does not own some land because his great, great grandfather stole it from an Indian tribe? If he does not own it who does? The tribe? Which members of the tribe? All of them? And which tribe owned which bit of America amyway? Considering that they tend to push each other about in various wars (but most eastern tribes farmed so there was plenty of “mixing ones labour”).

The man who is in non violent possession of land owns it – even if his great, great grandfather was very violent indeed, and he himself has never mixed his labour with it.

Life is not fair and there is never “as much and as good left for others”. Some people will work hard all their lives and by bad luck will end up with nothing (my father was a highly intelligent man and he worked very hard all his life – but he ended with nothing).

And some people will either be born rich, or will just find property comming into their hands with no great effort of their own (they were at the right place at the right time – by chance).

A defence of property based on “merit” or “labour” (or in American “labor”) is no defence at all.

As Edmund Burke pointed out in his “Letter to the Duke of Bedford” (a supporter of the French Revolution) agitators will never see a rich man as being entitled by merit to what he has (apart from the agitators own property of course – they will certainly see their own merit and labour by hand or brain). And certainly the Russel family (the Durkes of Bedford) had never shown much merit or mixed their labour with anything.

It is an insult to the poor to say that they are poor because they do not work enough – or are too stupid to work in a clever way.

And nor is then any “just society” where most poor people are going rich (no matter how hard they work).

False promises just stir up anger.

The old “Redneck” view is closer to the truth.

Some poor people may get rich, but most will not (and nor is it always the case that the best poor men will be the ones who get rich) – and a man should not measure himself by how much money he has. Keeping one’s word (regardless of the cost) and never kissing anyone’s arse (regardless of the benefit) is more important.

Nor should a man seek to take the goods of another man just because that man was born rich (but nor should he flatter a rich man either).

Life is shit and nobody gets out alive – but that is no excuse to steal a cent.

BillG (not Gates) April 18, 2006 at 11:32 am

Paul Marks wrote:

“I am not wildly pro John Locke’s labour theory of property”

“The man who is in non violent possession of land owns it – even if his great, great grandfather was very violent indeed, and he himself has never mixed his labour with it.”

BillG responds:

Paul the point was that property rights originate with self-ownership and the logical extension is that person’s labor.

“Though the earth, and all inferior creatures be common to all men, yet every man has a property in his own person. This nobody has any right to but himself.” — John Locke, 2nd Treatise of Government, Ch. 5

“The property which every man has in his own labour, as it is the original foundation of all other property, so it is the most sacred and inviolable.” — Adam Smith, The Wealth of Nations, Bk 1, Ch. 10, Pt 2

you therefore can’t have absolute rights to the fruits of your labor (hence self-ownership) at the same time as you have absolute rights to ownership of land beyond Locke’s proviso.

it is simply logically inconsistent because inorder to exist you must by definition occupy some space somewhere and if all lands are legally occupied you must pay someone a tribute to access the earth inorder to excercise your right of self-ownership.

Paul Marks April 19, 2006 at 10:07 am

Presenting quotes from John Locke to a man who does not accept Locke is like presenting quotes from the Bible to an atheist.

It invites the response “yes I agree it says this – so what?”

But to get back to Locke (who I do except was a great man).

I do not accept that the Earth is held by everyone in common (so that individual ownership of a bit of it has to be justified). That doctrine in Locke is based upon his following an interpretation of part of the Old Testiment (basically he followed the Pufendorf line, as he often did, rather than the Grotius line that land is unowned till someone claims it by occupation).

I also reject the “Lockian Proviso” of as much and as good left for others. One can make clever arguments – for example one can say that private ownership of land increases productivity thus meaning that there is more output “for others” that there otherwise would be.

But there is no need to make such arguments, because the fact that there is not “as much and as good left for others” is no argument at all for those people (such as myself) who do not follow John Locke’s interpretation of the Bible.

As for basic ownership (your logical point).

I accept self ownership. God may have indeed have created us (as Locke maintained), but I do not accept the labour theory of ownership – so that, in my opinion, God does not own us.

Our physical bodies are occupied by a reasoning will (us). And even if one takes a materialist point of view (holding that the “I” is just the physical brain) that does not mean there is no reasoning will (a free will being, an agent, an “I”) – i.e. materialism need not mean determinism (although it would be nice if it did – as determinism is absurd, and I would like materialism to be absurd also).

I return to my point about the man on his land.

He has been in peaceful possession of a bit of land all his life as have his forefathers, his reasoning will (him – the “I”) occupies this land peacefully and without dispute.

One day another man comes along – “your great grandfather stole this land from my great grand father – and you have not mixed your labour with the land, you do not even hunt and fish in this bit of land”.

So does the occupyer not own the land?

If people in peaceful possession do not own the land (without any talk about mixing ones labour with the land – by chopping down the trees and other such) then things are not good.

I prefer the older thinking of both Roman and Common law to John Locke’s labour theory of property.

Although (of course) I am not claiming that Locke held a labour theory of VALUE (he certainly avoided that absurdity – as his Venditto [spelling alert] shows us).

BillG (not Gates) April 19, 2006 at 10:47 am


how do you get from self-ownership to ownership of land without talking about labor?

Bob March 27, 2007 at 12:27 pm

Peaceful occupancy need not lead to property. I may occupy a patch of land, and have a right to continue that occupancy indefinately. Yet my rights to it may terminate when my occupancy ceases, therefore not enabling me to sell or rent the land, any more than a tenant, whose title is occupancy rather than ownership, may sell the land which he occupies.

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