Profiting From Our Loss

A recent letter to the editor of the Boston Globe from an officer at the Massachusetts Public Interest Research Group asks, “We’ve already paid to bail out banks and other big corporations — is it fair to ask us to pay their taxes as well?” Her question comes in response to a Globe article from May 1 that reports on a number of big companies that “paid no federal income taxes last year, despite making millions of dollars in profits.”

Since market anarchists regard taxation as no different from any other form of theft, one might assume that we toast Big Business’s tax avoidance. After all, in a free market everyone is entitled to what they make, right? And the answer to that question is yes — again, assuming we were in anything remotely close to a free market.

Unlike a free market, today’s economic system is a product of what Murray Rothbard called “oligarchic rule: rule by a coercive elite which has managed to gain control of the State machinery.” What those elites make is in no way something they’re entitled to, something obtained through simple, mutually satisfactory trade in a market where all are allowed to compete.

In the accepted political lexicon, free market phraseology has long been applied in the service of a state capitalist system defined by constraints and controls on economic activity, poisoning the well against the ideas of genuine freedom. Likewise, the language of egalitarianism and social justice has been dominated by advocates of a statist status quo who are hardly motivated by justice for the productive class.

What we’re left with is a distorted ideological framework wherein economic exploitation is associated with free markets, equitable conditions for the worker with state intervention in the economy. But the American Enterprise Institute doesn’t stand for true free markets, and the Center for American Progress doesn’t stand for true social justice.

The truth, though perhaps most will find it counterintuitive, is that unbridled economic freedom leads to economic justice. The two are not at all in conflict, as we’ve been assured by the fallacies of “both sides,” but are naturally and inseparably bound. It is monopolization, possibly only through the state’s coercive restraints on consensual economic behavior, that allows a few to amass enormous hoards of wealth, that allows them to extract rents from the toils of industrious society.

Although we all implicitly understand the effects of monopoly, we have been instructed to believe that they arise naturally from the uncontrolled bedlam of “cutthroat competition.” Monopoly, though, is a creature of the state, requiring coercion to cordon off resources and limit our options for survival.

Where open competition generates choice for workers and drives prices down for consumers, the state’s obstruction of potential competitors allows a favored few to skim off the top. Without the external pressure that would accompany total economic freedom, elites are allowed to pocket the difference between the price as it would be and the price reflecting a state-created condition of undersupply.

Whatever the amount of that difference, it is owed to the state’s violent intrusion into the economy for the benefit of the ruling elite; it is decidedly not owed to Big Business “giving the consumer what she wants,” or coming out on top in anything like real competition. Next time you’re looking for something to blame for “corporate greed” as it exists within state capitalism, look no further than heap of “consumer protection” and “safety” rules that suppress real free market alternatives.

Regardless of what you need — be it food, a job, anything — if you have to genuflect before the plutocrat’s system to get it, you’re going to be paying more than you would if free people were allowed to use their labor and resources in any peaceful way. Within this nefarious context, corporate tax breaks are repugnant enough, but let’s also spotlight all of those structures of privilege that advantage Big Business every day.

From direct subsidies and intellectual property to government contracts and regulatory cartelization, privilege is literally all around us, forcing us into an arrangement created by the ruling class. Counter to prevailing myth, a free market it is not. As Robert McIntyre of Citizens for Tax Justice rightly observes in the Globe article, “Our swashbuckling capitalists couldn’t live without the government subsidizing them.”

Anarchy and Democracy
Fighting Fascism
Markets Not Capitalism
The Anatomy of Escape
Organization Theory