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By Patrick L Young
From RT

Having spent all the money they can possibly borrow, the West’s rapacious governments are, like a drug-addled addict, desperate for more. To that end, taxes are on the up and a mantra of wealth redistribution is at the top of political wish lists.

This is of course a woeful state of affairs as the ability of governments to spend other people’s money wastefully is endless. The ability of governments to spend other people’s money in a useful fashion has always proven limited. The road to prosperity involves empowering innovation, small business and bottom-up growth. Top-down government meddling and rapacious taxes don’t help.

Therefore, from America’s basketballer-in-chief to Francois Hollande, the first custard pie of the Elysee (or whatever France terms him), a delusional race is on for more tax. Wage earners are already being clobbered and await more misery. Meanwhile, EU savers remain in danger of confiscation. The Cypriots have already lost out, while the Hungarian and Polish governments have engineered de facto theft of pension funds. IMF memos are already suggesting the only way to pay down the mountains of European debt will be to steal the people’s savings.

In the face of this totalitarian attack on enterprise and thrift, the forces of government are of course doing little to actually balance the economies they have already wrecked with their ongoing socialist folly.

Naturally the confiscatory left blames anything except their deranged anti-enterprise policies. That lovely Mr. Maduro, the socialist dictator of collapsing Venezuela, would happily corroborate the wonders of high tax socialism if he wasn’t so busy murdering his citizens for having the temerity to want food and vegetables on their dinner tables.

Venezuela, along with Argentina, seem like outrageously disorganized weird places to Western Europeans. Yet as Europe’s lost decade continues, Argentine-style economic dysfunction is increasingly the west’s future: A dystopia of socialist rallies seizing the wheels of commerce as part of the corporatist-socialist collectivist movement.

The West remains determined to tax and spend into oblivion. Small government is abhorred by government control freaks as individual responsibility is annihilated at the altar of smug totalitarian imbeciles ordering people to think (the great global warming charade for example) and removing personal liberty and responsibility with endless layers of regulation.

When it comes to tax, a vast army of uneconomic unproductive ‘quangocrats’ who believe money grows on trees are increasingly turning rapacious. This is turning into a tricky stand-off as companies exploit complex tax codes to their advantage. This appalls the non-commercial sector as they believe they have a God-given right to spend everybody else’s money. After all, they know so much better than the wealth creators how to run a better planet - again, just like that nice Mr. Maduro.

The realpolitik of tax is simple: every time the government adds a loophole or increases a tax, it incentivizes the tax-burdened to spend money on professional advice. Thus an army of private accountants works assiduously to process taxes and reduce liabilities. Therefore, government adds more rules, which only incentivizes the taxed to spend more money on advisers. In other words, an accounting arms race which doesn’t benefit the state.

Ultimately governments are lousy, inefficient allocators of resources (as Milton Friedman remarked, put government in charge of the desert and they’ll run out of sand). This discourages taxpayers to pay generously. True, some corporates and individuals go to extremes and are worthy of contempt: Bankers smuggling diamonds in toothpaste tubes demonstrated a remarkably lax sense of fair play. Likewise multinational companies with zillions in turnover, which barely pay a penny in some jurisdictions, are milking the system unreasonably. Then again just what legitimacy do incompetent, often corrupt government agencies retain to collect other people’s money and spend it injudiciously? The answer to that part is: very little.

We don’t need more tax, we need a tax reset. Thinner simpler codes, short reports, crisp flat tax rates to let the Laffer curve work its magic (the great economist Art Laffer demonstrated how lower rates of tax increase overall tax income: sadly the left have never been able to trust their political gut instinct to cynically steal from the talented and diligent.

Ultimately government must be weaned off its spending addiction. Tax codes need to be simple and rates flat. Government must shrink. Trust the citizens and they will be empowered to generate prosperity from the bottom up. No government ever created long-term prosperity with tax and subsidy.