Communism, Anarchy, and Taxes

            In communism, the state owns all property. Imagine a country in which all assets were taxed at one hundred percent. This would effectively be a communist system, since the government would own all property. Private property would cease to exist, and all property would be public. Conversely, imagine a state in which there are zero taxes. The state would cease to exist because it would have no revenue. All property would be private, and there would be no public property. Clearly, communism and anarchy are two poles of one continuum. On one end of the continuum, there is no private property and all public property, on the other end, there is no public property and all private property.

            Thinkers on both ends of the continuum have idealized each. In practice, societies have to determine where they want to fall on the spectrum. Some private property should be respected so that people have incentives to be productive. However, if people can accumulate so much private property that they represent threats to political stability, then private property should be taxed. Similarly, if financial institutions are going to want bailouts in a financial crisis, then they represent serious threats to the stability of society, and they should be taxed accordingly. Libertarians and anarchists view taxation is tyrannical, but taxes have social utility and can account for negative market externalities, such as secondhand smoke, environmental pollutants, and limit risky behavior.