Frank continues, attempting to refute the libertarians:
Without mandatory taxation, there could be no government. With no government, there would be no army, and without an army, your country would eventually be invaded by some other country that has an army. And when the dust settled, you’d be paying mandatory taxes to that country’s government.
Sounds plausible, right? Until you take into account two things.
Right now, there is both the government apparatus set up to collect taxes and the popular ideology supporting taxation. Under a more-or-less anarchic order, things are different.
First, then, the conquering country’s government would have to go door-to-door threatening, registering, and then monitoring each person and firm individually for tax collection. That is so inefficient that organized continent-wide taxation may never get off the ground.
This would be especially dangerous for the enemy, since Americans are individually so well armed. Even in the absence of an organized army, the invader would have to deal with a rifle behind every blade of grass.
Second, it assumes that if the people despise taxation, then the tiny clique of the new rulers can simply force their will upon them. But in the long run and in our case even in the short run, there are no unpopular governments. If 300 million Americans opposed taxation as such, they’d make their will known to the would-be taxers quickly and pointedly.
It is only now that the threat of being conquered and taxed exists. If the Ruritanians invade the US, then all they’ll have to do is decapitate the regime by killing Obama, dismiss the Congress, and set the taxes to whatever they pleased. (Or they could order the congressmen to vote to raise taxes to maintain the illusion of political continuity. Or simply take the existing tax revenue and spend it however they pleased. Or, finally, have Bernanke print a few trillion dollars.) The IRS and Federal Reserve would continue their work as before, and the people would probably obey the new masters out of habit.
Under city-state anarchy, say, on the other hand, imposing brand-new taxes on thousands of localities would likely be met with massive resistance.
One can only herd sheep not cats. If Americans were cats, there might be no need for an army at all.