The market for taxes

I spent the day in Fargo testifying in an asbestos case. I was the corporate representative for a defendant who never made or sold anything with asbestos but such are the vagaries of litigation. I had never been in Fargo and certainly did not have a comprehensive tour. But the part that I saw seems to have been oddly frozen in about 1959. I couldn't decide whether I liked that or not.

But back home, I see that Paul Soglin wasn't much impressed with the AFP rally in Madison and thinks that those who oppose more and more taxation in Wisconsin are penny wise and pound foolish. He notes that private firms certainly invest in the future, even when the return on that investment is not immediate and he is, of course, right about that.

But there are problems with the analogy. First, they invest in the hope of a return and the market will eventually tell them whether those hopes were realized. Government is not as readily disciplined.

Second, they do not simply decide what revenue is required to go out and do what they think is wise. They can't repeatedly raise prices. They can't charge more than their competitors without providing something that is worth the difference.

In other words, there is no market to tell them that their decisions are good or bad. You may say that, with government, it is the voters who impose this discipline.
Probably so, but that is what the AFP rally was about. People opposing taxes are the faces of discipline.

It seems to me that in a high tax state, the notion that citizens might believe that their government ought to be able to do what it needs to do without new revenue is hardly outrageous.

Businesses make that kind of decision every day.