“You’re either part of the solution or part of the problem.”- Eldridge Cleaver

“People who say ‘You’re either part of the solution or part of the problem’ are part of the problem.“–Robert Anton Wilson

“If you’re part of the solution, you’re no longer part of the problem … and should be acknowledged as such!” — Steve Trinward

There has been discussion lately, on at least a couple of the Yahoo lists I frequent, over whether voucher systems and tax-credit programs share similar evils of social engineering and socialist thinking in general. I tend to think they don’t, and for several reasons. Foremost among them is the fact that, while a voucher system is a giveaway program, involving taking taxpayer money and handing it back to those who may or may not have paid the taxes from which it is obtained, tax credits are marked off against what those taxpayers are supposed to be paying into the system, and the money stays with the person who made it. This should be a more than subtle difference to libertarians, since it involves the variance between redistribution of wealth and permitting a person to keep more of what is already belonging to that person.

But the larger complaint from some libertarians is that tax credits are often used for social engineering purposes, to reward behavior the society (or rather its government) wants to encourage. Conversely, those who engage in (what is societally considered) “inappropriate” (yet non-coercive) behavior (smoking, drinking, gambling, etc.) often end up getting taxed more heavily, in “sin taxes,” in order to make up the alleged “shortfall” in tax revenues that results from such credit programs. However, I think this misses a key factor in the equation, one that is demonstrated by my rewrite of Eldridge Cleaver’s oft-used slogan and Bob Wilson’s response to it.

If tax credits are granted to people who do things that would otherwise allegedly have to be done by government, thus actually saving money from the tax-base, it’s perfectly legitimate to consider that such people should not then have to pay (at least that amount) toward supporting the (demonstrably less-efficient and -effective) government programs purporting to accomplish the same purpose.

If we carry this idea to its logical conclusion, if everyone with a half a clue – and wishing to promote certain types of social function (schools, parks, health or safety programs, etc.) in lieu of paying taxes for the government to do so – were to play this game properly, ALL of the desirable community services would be provided, and NO taxes would be going into the government’s coffers. (What little else goes on in that realm involves fee-for-services payments from those actually using state or local services.)

Hello, limited-state!

Meanwhile, if a tax-credits program were to be truly equitable, there’d be a larger deduction from tax liability than the actual dollars being spent to get the task done, since it always costs more for government to do something than private citizens require. So in reality let’s say the average taxpayer could donate to school funds, a local community outreach programs, etc. – up to, say, 80 percent of his/her tax liability, pay no taxes whatsoever, and then pocket the “overhead” portion for other purposes, using it to pay for fee-based services. And now the reason for having government around in the first place completely dissolves, alongside its source of funding.

Hello, dare I say it … anarchism?

Arizona’s school-funding program is a pretty good model in many ways; it provides credits for any citizen contributing to the education of a child, their own or someone else’s. Moreover, it allows for corporate sponsorship of educational programs, so that even more kids are getting a better chance at learning and growing. (There are only two major drawbacks: the program does not yet apply to support for homeschooled students; and the general tax-funding of the government schools through conventional taxation has not been tagged to decrease as more citizens avail themselves of the direct support and credits.)

So we come back to the initial question: Can tax credits help to bring about a free society? While a reality-check brings up the fact that the vast majority of citizens will neither believe this is possible, nor be brave enough to try it, this does not say that the rest of us can’t push for more and more such programs, and then take full advantage of them ourselves. And ideally, almost every function performed by government today, at least the ones that have real value to a broad spectrum of the taxpaying public, could be performed better and cheaper by community-based organizations with direct funding.

Imagine for a moment, a society where each of these services is being provided by voluntary support, staffed by people who either (a) love the cause so much that they perform for a survival-level stipend plus modest expenses, for a few months or years at a time, before returning to the “real world”; or (b) have discovered a way (grants, side products, etc.) to make money from such work, without bleeding dry those (poor, needy, disabled, etc.) for whom the services are intended … where there is no need at all for nanny-statists holding a gun to people’s heads to force them to either pay for or perform such services.

I can dream, can’t I?