Category Archive 'Road to Serfdom'

21 Sep 2010

Go Directly to Serfdom Without Driving Farther Down Any Road

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In order to avoid a modest percentage of income tax underpayments, Britain’s equivalent of the IRS has come up with a startling new proposal which would de facto make every wage earner in Britain an employee of the state.

CNBC

The UK’s tax collection agency is putting forth a proposal that all employers send employee paychecks to the government, after which the government would deduct what it deems as the appropriate tax and pay the employees by bank transfer.

The proposal by Her Majesty’s Revenue and Customs (HMRC) stresses the need for employers to provide real-time information to the government so that it can monitor all payments and make a better assessment of whether the correct tax is being paid.

Currently employers withhold tax and pay the government, providing information at the end of the year, a system know as Pay as You Earn (PAYE). There is no option for those employees to refuse withholding and individually file a tax return at the end of the year.

If the real-time information plan works, it further proposes that employers hand over employee salaries to the government first.

“The next step could be to use (real-time) information as the basis for centralizing the calculation and deduction of tax,” HMRC said in a July discussion paper.

HMRC described the plan as “radical” as it would be a huge change from the current system that has been largely unchanged for 66 years.

Even though the centralized deductions proposal would provide much-needed oversight, there are some major concerns, George Bull, head of Tax at Baker Tilly, told CNBC.com.

“If HMRC has direct access to employees’ bank accounts and makes a mistake, people are going to feel very exposed and vulnerable,” Bull said.

And the chance of widespread mistakes could be high, according to Bull. HMRC does not have a good track record of handling large computer systems and has suffered high-profile errors with data, he said.

The system would be massive in terms of data management, larger than a recent attempt to centralize the National Health Service’s data, which was later scrapped, Bull said.

If there’s a mistake and the HMRC collects too much money, the difficulty of getting it back could be high with repayments of tax taking weeks or months, he said.

“There has to be some very clear understanding of how quickly repayments were made if there was a mistake,” Bull said.

23 May 2007

Endpoint of the Road to Serfdom

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Fjordman finds that the Road to Serfdom ends at the modern bureaucratic welfare state. Much of Europe has already arrived, and the United States is speeding to catch up.

Why does the government dispense with the social contract and attack its own people? Well, for starters, because it can. The state has become so large and powerful that is has become an autonomous organism with a will of its own. The people are there to serve the state, not vice versa. And because state power penetrates every single corner of society, there are no places left to mount a defense if the state decides to attack you. Its representatives are no longer leaders of a specific people, but caretakers preoccupied only with advancing their own careers through oiling and upholding, and if possible expanding, the bureaucratic machinery.

As Alexander Boot writes in his book How the West Was Lost, “a freely voting French citizen or British subject of today has every aspect of his life controlled, or at least monitored, by a central government in whose actions he has little say. He meekly hands over half his income knowing the only result of this transfer will be an increase in the state’s power to extort even more. […] He opens his paper to find yet again that the ‘democratic’ state has dealt him a blow, be that of destroying his children’s education, raising his taxes, devastating the army that protects him, closing his local hospital or letting murderers go free. In short, if one defines liberty as a condition that best enables the individual to exercise his freedom of choice, then democracy of universal suffrage is remiss on that score.”

Friedrich A. Hayek warned in The Road to Serfdom against all collectivist ideologies, and feared that the social democratic welfare state would eventually propel society in a totalitarian direction. He has been dismissed as wrong, but was he? In Western Europe, it is difficult to imagine that we would have accepted the massively bureaucratic European Union if we hadn’t already been conditioned to accept state intrusion on all levels of our lives in our nation states. The EU became just another layer of bureaucracy. We now have a situation where a massive, inflated national and transnational bureaucracy runs our lives, and even writes our laws. We have become serfs, just as Hayek warned against.

It is possible to argue that this is a built-in flaw in the democratic system. As blogger Ohmyrus has shown, democracies will tend to expand into high-taxation welfare states because, simply put, there are more low-income people than rich people, and it is possible for politicians to stay in power by giving people access to other people’s money. …

A characteristic of the situation in Western Europe is that we have more and more laws, yet at the same time more and more lawlessness. The German journalist Jens Jessen claims that his country has been gripped by a “prohibition orgy” regarding tobacco, cars, cheap holidays and computer games, television and fast food. The process is “disconcerting and almost grotesque in its systematization.” He believes there is some level of compensation going on for the powerlessness of politicians.

Parallel with an explosion in street crime, the state turns on its law-abiding citizens with a proliferation of regulations and an inflation of laws. The less control the state has over the the most important tasks of society, the stronger its desire to assert its power over the tiniest details becomes. Or is it a subtle show of force, a constant reminder to the average citizen of who’s boss, a sign that resistance to state policies is feared?

As Jessen points out, the dangerous thing about this spirit of prohibition is that “once it’s out of the bottle, it spreads like an infection” whose first casualty is tolerance: “The fettered citizens are going to loll in security; the more unbearable the state regulations, the more relaxed they will feel. But such a society, one that makes the individual citizen and he alone responsible for all possible environmental sins, can easily become the blind accomplice to the worst catastrophes on the international stage.”

As Alexander Boot writes: “Parliaments all over the world are churning out laws by the bucketful. Yet, they fail to protect citizens so spectacularly that one is tempted to think that this is not their real purpose. […] Governments are no longer there to protect society and the individuals within it. […] For that reason a crime committed by one individual against another is of little consequence to them.”

Theodore Dalrymple
has noticed the same trend in the United Kingdom, where Tony Blair’s Labour government “has created 3,000 new criminal offences in ten years, that is to say more than one per working day, when all along the problem in Britain was not a insufficiency of laws, but a lack of will to enforce those that we had. The law is now so needlessly complex, and so many laws and regulations are promulgated weekly, daily, hourly, without any parliamentary oversight, that is to say by administrative decree appropriate to a dictatorship, that lawyers themselves are overwhelmed by them and do not understand them. There could be no better recipe for the development of a police state.”

The state interferes in all aspects of life, and contributes to breaking down the nuclear family. Later, it creates expensive social programs to try and remedy the problems it has itself partly created. Whether this dynamic is part of an intentional policy or the result of a dysfunctional ideology is debatable, but the result is disastrous either way. And it becomes even worse when you add an additional layer of transnational regulations. As the British reader Archonix comments on the Gates of Vienna blog:

“In order to install an electrical socket in my kitchen I must comply with at least eleven separate regulations. Some are sensible, governing the type of wire to use and the general direction that wire should go in. Others are nonsense; in order to comply I have to place my sockets a certain distance from the floor no matter what their purpose. EU regulations now mandate by law the kind of taps I’m allowed to use in my bathroom. They mandate the height of my door, the height of the gap between the door and the ceiling and the angle of my stairs, to millimetre precisions. Every day I break about 30 laws whilst engaged in what were previously lawful activities. Most of these laws are EU-inspired regulations prescribing the details of how activities are to be carried out. My computer does not comply with regulations on lead content, electrical output or anything else, despite being perfectly safe. The lights in my house will soon be made illegal. None of this was done with the consent of Parliament. None was done with the consent of the people of this nation.” …

When does the rule of law break down? It breaks down when laws are no longer passed with the consent of free people, when citizens no longer feel that the law is just, when regulations become so numerous that it is virtually impossible even for decent individuals not to break the law on a regular basis and when the authorities are incapable of protecting their country’s borders while criminals rule the streets. It breaks down when the law appears increasingly arbitrary, when it invades the most intimate details of the life of law-abiding citizens while it allows great freedom to criminals. In short, it breaks down when it no longer corresponds to reality and to the sense of justice experienced by ordinary people.

Hat tip to News Junkie at Maggie’s Farm.


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