Tax Cheats Become Italy’s Public Enemy:
In addition to banning cash transactions, the effort has included an ad campaign comparing tax evaders to parasites. There have been headline-grabbing controls focusing on stores, hotels and restaurants in affluent Italian cities. For good measure, tax officials have also been stopping luxury cars and asking drivers to show their licenses, along with their most recent tax returns.
This sort of behavior on the part of public officials is not going to happen in the USA. We have “rights.” But, I think those rights can only exist because the USA has enough social capital that the government receives a sufficient amount of taxes from an honest citizenry. Rights are not abstractions or axioms, but derive from concrete realities.
With a $16 trillion debt, there doesn’t appear to be a “sufficient amount of taxes” to pay the bills. Fortunately, we have lenders willing to bet on our social capital, even as our credit rating is downgraded.
Libertarians might argue that rights have also been downgraded. Certainly not as dramatically as with Italy’s stop-and-frisk of luxury car drivers; but “class warfare” isn’t just a talking point of the right. Of course we’re only talking economic liberty, which the SCOTUS unyoked from political/civil rights some time ago.
I would not bet on that lasting. I’ve seen more and more people paying for services in cash to avoid reporting the full amount. Of course, there’s the huge phenomenon of hiring illegal aliens to avoid having to deal with the overhead of legal workers. Nothing I’ve seen implemented will reduce those incentives.
The fundamental problem the country faces, both large-scale and small-scale, is that for our republican (with a small “r”) democracy to work, the people as a whole have to exhibit basic virtue. The Founders — include the most secular among them like Jefferson and Franklin — understood this quite well. And for the past 50 or so years, the elites in the country have been heck-bent on erroding the civic and legal supports to the kinds of public virtue necessary for a republic like ours to operate well. That doesn’t mean that we are headed into Italian-style trouble — but it does mean that our political and economic sphere is becoming increasingly rickety.
I have never seen a better reason to abolish income taxes and go to a consumption tax system.