The Maker of Shortages
understood, for it frequently consisted of the lifting from the producer's premises of goods he had labored for in the expectation of enjoyment: his corn, cattle, or other accumulations. That was palpable evidence of the scarcity-producing nature of taxation. No mutation occurs when the tax is collected in the form of money; it is still part of what the producer has labored for in the hope of satisfying his desires. It is shoes, bread, entertainment.
Taxation not only robs the market place of consumable goods, which is the true measure of a nation's economy, but it also reduces the productive capacity of Society by its absorption of savings, or capital. It is obvious that the individual cannot save what he does not have. And since savings become investments in productive machinery, the lack of savings means a shortage of those instruments that make abundance possible. Thus, taxation deprives the consumer of immediate satisfactions and lessens the possibility of plenty in the future. In both effects, taxation is a shortage-creating institution, and that is not what men have in mind when they merge themselves into Society.
Idolators of the State are wont to counter this fact with the observation that productive effort seems to increase with an increase in taxation, inferring that the activities of the State are economically beneficial. This is equivalent to saying that men work to pay taxes and that the bigger the tax load the greater their productivity. If this were so, then the wealthiest and healthiest economy would be achieved by the State's confiscation of everything produced—which is the claim of communism. Yet the production figures that leak through from communist countries add up to economies of scarcity, to an abundance of shortages. And historians tell us that the continuing and mounting exactions of the Roman 124