When I bring up the price of government most people consider taxes. Sales tax, property tax, and income tax come to mind, but that's about it. If you know roughly how much you pay in taxes, then you know how much government is costing you. It's a number that can be figured out. It's right in front of you. Pretty simple, right?
People always think about lowering taxes as one way, some think of it as the only way, to lighten the financial burden of government for the average person. Politicians use this to their advantage. If they can convince you that they will lower taxes more than the other guy, maybe you'll vote for them. Isn't it funny how every single politician ever to run for office has claimed, at one time or another, that they would lower or cut taxes, yet somehow taxes aren't at zero?
What voters don't realize is that it is often not the tax that is the biggest cost of government!
Here's the deal: Austrian economists have been pointing out the hidden costs of government for quite some time now. Unfortunately, the average American is completely blinded and these hidden costs remain hidden. Most Austrian economists will describe inflation as a hidden tax. That's Ron Paul's favorite, I think. There are others, too.
Think about how much your car cost to purchase when you bought it. Now imagine you could get the same car for half the cost, or maybe twice the car for the same cost. Well you probably could, if it wasn't for government getting in the way.
At some point some politician (probably one that promised to lower taxes) thought it would be a great idea to force car manufacturers to have a certain safety system. For this example, let's use airbags. So all car manufacturers have to put airbags in their cars because of a government regulation. They are forbidden, by law, to sell a new car without this particular safety feature. But airbags cost money, and that cost is paid by you, the consumer. So now all cars that are sold in the united states have a new safety feature, whether you want it or not, and they all cost more to purchase as a result.
Of course, it doesn't stop with air bags. There are dozens of government regulations on cars that all cost money, and you pay for each and every one of them anytime you buy a car. Think about the mandatory fuel economy that government forces auto manufacturers to meet. Some people aren't even aware it exists. My new friend Eric Peters talks about it in his last blog post. If you like the idea of driving a car with a V8 you might be in for a shock. There is a very good chance you won't be able to afford that car unless you have plenty of money to throw around. In fact, the next time you think of buying a new car you might be very disappointed with the options available.
Of course, you don't have to buy the car with the V8, you can always opt to purchase a less expensive car. but that's not the point. The point is: Thanks to government, you cannot afford to purchase something you might otherwise be able to purchase. It is a hidden tax on the cost of a premium vehicle. The standard of living is now lowered thanks to government. Instead of everyone who wants to buy one being able to afford a premium vehicle, now only the special elite who can afford to shell out big bucks will be able to do so.
It doesn't stop with cars, either.
Another example: Thanks to government regulations via the EPA we're forced to purchase shower heads that shower us with less water than they used to. They actually passed a law regulating the amount of water that is allowed to go through the shower head per minute. Anyone who is as old as I am or older must certainly remember a time when a shower was a wonderful feeling of hot water cascading all over your body. It was a wonderful massage. Nowadays it feels like water dribbling out onto you. Every time I shower I feel like I have left over soap and shampoo on my body and in my hair. What I wouldn't give to have that old shower head back. Sure, I could do it if I had enough money to put together a few shower heads and make a super shower head, but it didn't used to be necessary to do that.
Again, not exactly a tax, but we pay for government by living a life of lower quality than what we used to live. The cost is in a reduction in standard of living.
The next time a politician swears that they will lower taxes in order to get your vote, pay attention to the other hidden costs that we all might end up paying. If voters don't start looking for them soon, only the elite super rich will be able to afford to buy new cars or shower more than once a week.
That's the way I see it.
 |
| I'm sure there are voters in both camps who think their candidate will bring lower taxes than the other. |
Here's the deal: Austrian economists have been pointing out the hidden costs of government for quite some time now. Unfortunately, the average American is completely blinded and these hidden costs remain hidden. Most Austrian economists will describe inflation as a hidden tax. That's Ron Paul's favorite, I think. There are others, too.
Think about how much your car cost to purchase when you bought it. Now imagine you could get the same car for half the cost, or maybe twice the car for the same cost. Well you probably could, if it wasn't for government getting in the way.
At some point some politician (probably one that promised to lower taxes) thought it would be a great idea to force car manufacturers to have a certain safety system. For this example, let's use airbags. So all car manufacturers have to put airbags in their cars because of a government regulation. They are forbidden, by law, to sell a new car without this particular safety feature. But airbags cost money, and that cost is paid by you, the consumer. So now all cars that are sold in the united states have a new safety feature, whether you want it or not, and they all cost more to purchase as a result.
Of course, it doesn't stop with air bags. There are dozens of government regulations on cars that all cost money, and you pay for each and every one of them anytime you buy a car. Think about the mandatory fuel economy that government forces auto manufacturers to meet. Some people aren't even aware it exists. My new friend Eric Peters talks about it in his last blog post. If you like the idea of driving a car with a V8 you might be in for a shock. There is a very good chance you won't be able to afford that car unless you have plenty of money to throw around. In fact, the next time you think of buying a new car you might be very disappointed with the options available.
Of course, you don't have to buy the car with the V8, you can always opt to purchase a less expensive car. but that's not the point. The point is: Thanks to government, you cannot afford to purchase something you might otherwise be able to purchase. It is a hidden tax on the cost of a premium vehicle. The standard of living is now lowered thanks to government. Instead of everyone who wants to buy one being able to afford a premium vehicle, now only the special elite who can afford to shell out big bucks will be able to do so.
It doesn't stop with cars, either.
Another example: Thanks to government regulations via the EPA we're forced to purchase shower heads that shower us with less water than they used to. They actually passed a law regulating the amount of water that is allowed to go through the shower head per minute. Anyone who is as old as I am or older must certainly remember a time when a shower was a wonderful feeling of hot water cascading all over your body. It was a wonderful massage. Nowadays it feels like water dribbling out onto you. Every time I shower I feel like I have left over soap and shampoo on my body and in my hair. What I wouldn't give to have that old shower head back. Sure, I could do it if I had enough money to put together a few shower heads and make a super shower head, but it didn't used to be necessary to do that.
Again, not exactly a tax, but we pay for government by living a life of lower quality than what we used to live. The cost is in a reduction in standard of living.
The next time a politician swears that they will lower taxes in order to get your vote, pay attention to the other hidden costs that we all might end up paying. If voters don't start looking for them soon, only the elite super rich will be able to afford to buy new cars or shower more than once a week.
That's the way I see it.
Comments
Post a Comment