April 11, 2012
Starve The Beast, Does It Work?
Starving the beast, or to put it another way, doing everything possible to not give the state any money does work.
It works extremely well and the state is simply unable to do anything about it. The state could put up taxes more, in fact they already do this every budget but the law of diminishing returns means that their taxes bring in less every year and high taxes simply lower investment so growth in future years is less anyway. The state really is between a rock and a hard place.
Consider this new report by the Tax Payers Alliance. Clearly £28bn is one hell of a lot of money that the govt hasn't managed to get its rapacious hands on.
But remember, this only covers the black market. It doesn't include those who for example grow their own tobacco, brew their own booze and walk to work instead of taking the car.
The govt is still going to borrow an additional £120bn this year despite all the cuts. (In reality there hasn't been any cuts, govt spending is still growing year on year).
This situation cannot last forever and every pound that we keep safe from the state brings our victory closer.