Many people take the view that taxation is theft. The idea is that taxation is a forced payment of one’s legitimately acquired wealth to the government. If you don’t pay then ‘men with guns’ will come and take the money away from you by force.
What is legitimately acquired wealth? According to John Locke, people were entitled to use unclaimed resources from nature - that people created wealth by ‘mixing their labor’ with natural resources. Also, people were entitled to wealth that they acquired as gifts and that they earn by being paid to work for others. And of course, people could acquire wealth by making a profit on transactions. But - are they really entitled to all of the money they acquire in these ways?
Lets consider a simple case - that of mixing your labor with unclaimed natural resources - say by digging clay and building a kiln to make pottery. Isn’t that pottery yours alone? Certainly it is in the case where you start from scratch and make everything yourself. In which case you might get a few pots after a lifetime of work and trial and error. But it is solely yours.
Lets call this rate of return for work the Base Rate.
Imagine the advantage you would have if you already knew the technology of ceramics; ie how to prepare and work the clay, what materials made good glazes, how to build and operate the kiln. Where did the knowledge come from? From society. And of course, if you can just go and buy the materials and equipment you need to make pots, then your pottery production, for the same amount of mental and physical work, would be much greater still. So if wealth is useful things that we make by our work, then obviously living in society multiplies the effect of a given amount of labor.
Lets call this rate of return for work the Social Rate.
Social wealth is the Social Rate minus the Base Rate.
That is, social wealth is the difference between the effectiveness of your work when you are part of a society and the effectiveness of your work if you don’t have the benefit of society. So if the effectiveness of your work is multiplied by living in society, isn’t reasonable to suggest that society has a claim on some of the wealth that you produce?
Most of us benefit from social wealth, but not everyone benefits equally. Some people work pretty hard, but don’t actually earn much more than their bare sustenance. Its reasonable to think that social wealth is not a component of their earnings because the effect of their work isn’t being multiplied.
Other people find that there is a huge multiplier in the effect of their work - and so social wealth is a huge part of what they earn.
How much of social wealth belongs to society and how much to the worker? Clearly this is somewhat arbitrary, and its something for the society to decide via some sort of political process. But lets say, for discussion purposes, that society is entitled to half of social wealth. Notice that this concept is inherently graduated - those whose earnings have a high proportion of social wealth would naturally repay a larger share of their earnings. If social wealth makes up 95 % of your earnings then you would owe 47.5 % of your earnings to society. If social wealth makes up 5 % of your earnings then you would only owe .5 % of your earnings to society.
From this perspective taxation is just paying to society it's fair share of social wealth. So rather than taxation being theft, refusing to return your fair share of social wealth to society is theft. And refusing to pay a legitimate debt is initiatory force that justifies sanctions against the refusers. And even libertarians think its OK to call for sanctions against people who don’t repay debts. Libertarians are all in favor of men with guns helping them out when it is them who is owed the money. Why should it be different if society is owed the money?
This is no utopian way of thinking - it doesn’t automatically eliminate the difficulty of deciding the correct level of social services a society should provide or which services. Nor would it eliminate the difficulty of determining the right proportion of social wealth that should go to society. And what better way of deciding an issue like that than a democracy? The main purpose of the idea is to show that the libertarian idea that taxation is theft is a mistake. Libertarians assume that there is no such thing as social wealth - that whatever wealth and money one acquires is one’s alone. But that assumption doesn’t seem realistic to me.