# No Income Tax? What Would Happen? **URL:** \ **Category:** Great Debates\ **Created:** [May 6, 2012, 7:48pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095 "2012-05-06T19:48:41Z")\ **Posts on this page:** 20\ **Page:** 5
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [May 8, 2012, 6:55pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/81 "2012-05-08T18:55:44Z")
> [@Sinaptics](#): > > I don’t consider your example efficient or convenient at all. Just to flesh that idea out a little, either there will be prescribed meal times or food will be wasted since it’ll have to be cooked and kept hot all day. The efficient/less costly method would be to set meal times, of course. > [@](#): > > What about people with allergies? Or people who plain just don’t like meatballs on meatball day? Or vegetarians? Tough for them. What about people who like to smoke dope today? How do you accommodate them? ---
**Author:** ![Airbeck](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/airbeck/32/6574_2.png) [@Airbeck](https://boards.straightdope.com/u/Airbeck)\ **Post date:** [May 8, 2012, 7:39pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/82 "2012-05-08T19:39:27Z")
> [@Terr](#): > > Because there are powers that are inherently macro. That’s what the Constitution recognized. So the federal government can indeed handle some things well, then right? What of the sarcastic snide remarks about how “the feds know better than the locals what’s good for them” then? Still stand by that attitude? Clearly you admit that at least in some cases the evil federal government does know what’s good for you, right? Otherwise, why trust the feds to do anything right? I’m just trying to square your hatred of federal government with your admission that it indeed can and does handle at least some things better than individual local governments. I just don’t see how both of these thoughts can exist in the same brain at the same time without being able to see the contradiction. ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [May 8, 2012, 8:06pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/83 "2012-05-08T20:06:32Z")
> [@TriPolar](#): > > Obviously a lot of people would be unhappy with any change to the system, so even though everybody is unhappy with the system we have, very few are actually willing to risk a change which doesn’t specifically benefit them. But there are plenty of possible changes. Cutting out income tax revenue without replacing it with another source is a total non-starter. Yeah, my reference to there being “no way” to replace the income tax was meant in this spirit – people just could not agree on what the new system should be, and that means income taxes aren’t going away until there’s agreement on how to replace it. It would probably be easier to add a VAT tax or a property tax (or whatever) on top of the income tax, rather than get rid of the income tax and suddenly shift to some new revenue structure. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [May 8, 2012, 8:14pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/84 "2012-05-08T20:14:44Z")
> [@Airbeck](#): > > So the federal government can indeed handle some things well, then right? I didn’t say “well”. I said there are powers that are inherently macro, thus belong to the federal government. Whether they are doing that stuff “well” is a matter of opinion. ---
**Author:** ![Lemur866](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lemur866/32/434_2.png) [@Lemur866](https://boards.straightdope.com/u/Lemur866)\ **Post date:** [May 8, 2012, 9:26pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/85 "2012-05-08T21:26:10Z")
By what criteria do you sort government powers into macro and local? I don’t mean you should list which ones are which, I mean, how do you know which power belongs in which category? ---
**Author:** ![erislover](https://avatars.discourse-cdn.com/v4/letter/e/71e660/32.png) [@erislover](https://boards.straightdope.com/u/erislover)\ **Post date:** [May 8, 2012, 9:35pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/86 "2012-05-08T21:35:16Z")
Just as soon as we have only local businesses, too. For if we admit that non-local businesses (e.g. multi-state corporations or multinationals) can fare better than local ones, we should similarly admit that non-local (e.g. federal) government can fare better than local government, as these two things—government and business—are merely two different tools of social organization directed at solving problems (and sometimes creating them, one should admit). I am not prepared to state unequivocally that non-local businesses must exist in all possible economies, but if we’re going to have them, then their rights and obligations must be defined and defended, and this necessarily requires non-locality of governance, as far as I can tell. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [May 8, 2012, 9:42pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/87 "2012-05-08T21:42:54Z")
> [@Jake](#): > > What _would_ happen if, somehow, the income tax was suddenly and deliberately abolished? > A whole lot of chaos, to be sure, but would it collapse the US economy? Would it bring business and industry back into the US? I’m not looking for a lot of “who would pay for this and that” responses. > I think capitalism has a way of straightening things out in the long run. > What do you think? Let me answer your question before I dive into the “libertarians are stupid” dogpile. The businesses that left America didn’t leave because of taxes, they left because of expenses and regulations. We simply can’t compete on labor costs. Noone is going to leave China for America because we get rid of the income tax. Income taxes are levied on profits and you simply cannot profitably compete with China in these areas. And we are not about to get rid of the regulations that make China easier to to operate in. We are not about to put profit above worker safety or monetize the value of individual lives. We can’t get our businesses and industry back. We have to build new ones (who will also move to low cost jurisdictions after a while). We have to constantly inovate to justify the humongous gap between our standard of living and the standard of living in the rest of the world (that or become colonial era imperialists). > [@Trinopus](#): > > Not when we actually get to elect the people making those decisions. Then it becomes freedom again. > > The advantage of centralizing and distributing (socialism!) is that it smooths out the differences between poor areas and rich areas. Otherwise, you will have quality of roads (bridges, drains, etc.) highly correlated to local wealth levels. The rich drive on broad, smooth highways, and the poor get rutted, clogged, narrow roads. > > The U.S. has tried it both ways, and many (most?) of us prefer the “levelling” approach of FDR and LBJ, rather than the “trickle down” approach of RWS and JWB. > [@Terr](#): > > Sure. And freedom is slavery, war is peace, etc. etc. etc. Do you actually think about what you say? The problem with conservatives generally and libertarians in particular is that they think they have a monopoly on good ideas. Democracy does not work well for anyone who thinks that only their ideas are any good. > [@Der\_Trihs](#): > > You don’t have that choice without a government to to the footwork for you. Despite the ego-fantasies of libertarians, individuals don’t have the capability to duplicate the work of entire government agencies. And without public education most of the population would be illiterate anyway. It might reduce the standard of living enough that apple will manufacture its iPhones here and export them to China. > [@Martin\_Hyde](#): > > If it happened overnight it would be devastating, practically of course it is an impossibility that it could happen overnight. > > Government needs X portion of society as a whole’s income each year to survive. If we had a situation where we were forced to phase out the Federal income tax other taxes would be levied which would generate the same revenue. > > You can get the same portion of society’s income each year from other types of taxes, but the rates would be a lot different from what we see now. The way in which you drain the blood can have different effects on the economy. Income is one of the better ways to do it just because it is automatic, difficult to avoid, and consistent. But there are technically other ways the government could fill its coffers. Pffft. You socialist! > [@TriPolar](#): > > It’s rather immature reasoning to say democratic government takes away your freedom because you don’t agree with everything that results from the process. Well, he never actually signed the social contract, it was thrust upon him. > [@Terr](#): > > Right now, you have to pay protection money if you’re in certain neighborhoods in return for which your business runs smoother and doesn’t burn down. Freedom. And you think that extortion increases or decreases without the FBI and IRS putting guys like Capone and Gotti in jail? > [@Terr](#): > > I would say this government would be stopped by the homeowners before that happened. Now you think democracy works all of a sudden? > [@](#): > > Locally, people know very well what the costs are. I have absolutely no problem with local governments, local taxes, and local regulations. The key word is local. Local government is (generally speaking) more corrupt, more wasteful and subjected to more fraud than the federal government. > [@fumster](#): > > I never understood the “local is better” argument. It seems to be pretty much the opposite in reality. States needed to be dragged kicking and screaming to abandon Jim Crow, voter suppression, religious intrusion into public schools, etc. Local governments also tend to be more corrupt, both financially and in how they prosecute criminals. At one time whites could literally get away with murder. From a practical standpoint, there are staggering differences in the tax base available to local governments, with the result that the quality of education available to children depends on where they live. How does that make any sense at all? > > And those “small government” states tend to suck: trailing the nation in education, health, income, teenage pregnancy, and other metrics. If it weren’t for the largess of the more progressive states they would suck even more. > > It reminds me of the UHC argument: if you look around and see that every other country in the world has lower health care costs maybe it’s time to put down the ideology and face reality. “Local is better” really only applies to fruits and vegetables and real estate investments. > [@Terr](#): > > Again, local regulations, local government and local taxes are not a problem, for me. Local is the keyword. Right because there is no tragedy of the commons if we let localities formulate environmental laws. I can dump all my waste in the river and let it flow down to you. I can belch mercury and cyanide out of my smokestacks and send it downwind to you. > [@Terr](#): > > I don’t want to rewrite the Constitution. The federal government should stick to article 1, section 8. The military, immigration/naturalization, foreign policy, currency, regulate (mostly get out of the way) commerce \*\*between \*\*states and foreign commerce. The rest is local. Of course we should write teh commerce clause and the welfare clause out of teh cosntitution because they didn’t really mean that part of the constitution. Can I pick and choose the parts of the constitution I want to ignore? Can I focus on my favorite parts to the exclusion of the rest? > [@Saint\_Cad](#): > > So how did the government run before income tax was constitutional? We didn’t have roads or a standing army or much of a navy for that matter. We also didn’t have entitlements and a department of homeland security. What we call “the government” outside of entitlements and military/security spending is 10-15% of the budget. > [@](#): > > First of all, if income tax were abolished, we would have to dispense with the current level of Keynsian economics. For an Austrian like me that is a good thing but you can see from this thread that Keynes is so engrained in most Americans that most equate smaller revenue to a complete collapse of Western civilization. First of all Keynesian stimulus depends largely on deficit spending. Sure there is a bit of efficiency that you get from taxing and spending if the taxing and spending is particularly well executed but thats a toos up at best. Most of the stimulative effect of keyemsian stimulus comes from deficit spending. Injecting money into the economy without taking it back out in the form of taxes. If you spend $100 in keymesian stimulus and increase taxes by $100, you rally aren’t goign to get very much done. You have to spend borrowed money to soak up all that slack in supply. > [@Terr](#): > > Sure. Cuz the federal government knows better than the locals what’s good for them. In many cases do and in almost every case the federal government knows what is better for the nation as a whole than a single state does. > [@Terr](#): > > There are powers reserved for federal government. Military, immigration/naturalization, foreign policy, currency, macro economic policy. The rest of the powers/decision making should be local. Isn’t the regulation of interstate commernce and providing for the general welfare also somewhere in the constitution or do we read those out because they are inconvenient to your ideology? > [@Lemur866](#): > > Of course there’s a way to generate the revenue currently generated by the income tax. A broad-based sales tax or value-added tax would work just as well, arguably better in some ways. You don’t pay taxes when you earn your income, you pay taxes when you spend your income. Plenty of countries use this system. Are you saying that there is some developed country somewhere that depends on a sales tax without an income tax? > [@](#): > > Of course, we’d have to on average take in the exact same amount of government revenue, and so the average tax bill for the average citizen would be on average the same. Yeah on average, maybe but we would end up collecting the taxes from different people. > [@Terr](#): > > Because there are powers that are inherently macro. That’s what the Constitution recognized. Yeah, like the regulation of interstate commerce. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [May 8, 2012, 9:54pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/88 "2012-05-08T21:54:34Z")
> [@Terr](#): > > I didn’t say “well”. I said there are powers that are inherently macro, thus belong to the federal government. Whether they are doing that stuff “well” is a matter of opinion. Who defines what is inherently macro? Are you sure that if Madison came back today he’d be quite as rigid as you are? The Founders knew how to compromise, they accepted the need for amendments, and they were still alive (to put it ,mildly) when the Supreme Court started interpreting. It seems an act of faith on your part that they would ignore changed circumstances and stick to strict construction, but they were people who risked their lives on changing things due to changed circumstances. ---
**Author:** ![Lemur866](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lemur866/32/434_2.png) [@Lemur866](https://boards.straightdope.com/u/Lemur866)\ **Post date:** [May 8, 2012, 10:32pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/89 "2012-05-08T22:32:06Z")
Note: manufacturing, measured by the value of manufactured goods created, is higher than ever in America. Our manufacturing sector hasn’t collapsed. What has collapsed are manufacturing jobs. We still make all kinds of things, but a factory that 50 years ago might employ 1000 people today might employ 50. It is also true that our manufacturing sector has grown at very low rates compared to the service sector. But it has still grown in absolute terms even though it’s a smaller percentage of our economy. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [May 8, 2012, 11:05pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/90 "2012-05-08T23:05:20Z")
> [@Lemur866](#): > > By what criteria do you sort government powers into macro and local? I don’t mean you should list which ones are which, I mean, how do you know which power belongs in which category? Article 1, Section 8 of the Constitution. ---
**Author:** ![Algorithm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/algorithm/32/12204_2.png) [@Algorithm](https://boards.straightdope.com/u/Algorithm)\ **Post date:** [May 8, 2012, 11:25pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/91 "2012-05-08T23:25:16Z")
> [@Terr](#): > > Article 1, Section 8 of the Constitution. What do you mean when you say “inherently macro”? ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [May 8, 2012, 11:57pm UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/92 "2012-05-08T23:57:33Z")
> [@Algorithm](#): > > What do you mean when you say “inherently macro”? Foreign policy is inherently a power of the federal government, not of my local county council. Settling disputes in trading between states is inherently a power of the federal government, not my city’s mayor. Making common currency is inherently a power of the federal government, not my state assembly’s. Hope this makes it clearer. ---
**Author:** ![Algorithm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/algorithm/32/12204_2.png) [@Algorithm](https://boards.straightdope.com/u/Algorithm)\ **Post date:** [May 9, 2012, 12:24am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/93 "2012-05-09T00:24:54Z")
> [@Terr](#): > > Foreign policy is inherently a power of the federal government, not of my local county council. Settling disputes in trading between states is inherently a power of the federal government, not my city’s mayor. Making common currency is inherently a power of the federal government, not my state assembly’s. Hope this makes it clearer. I was more looking for an explanation of the “inherent” part of the term. One that doesn’t rely on the Constitution, since presumably your explanation of the inherently macro nature of those powers would justify their presence in the Constitution to begin with. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [May 9, 2012, 12:26am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/94 "2012-05-09T00:26:03Z")
> [@Terr](#): > > Foreign policy is inherently a power of the federal government, not of my local county council. Settling disputes in trading between states is inherently a power of the federal government, not my city’s mayor. Making common currency is inherently a power of the federal government, not my state assembly’s. Hope this makes it clearer. Is equal protection under the law an inherently macro function? Is it a function of the federal government to ensure that all citizens are treated basically equivalently by the law no matter where they happen to be residing? If you are going to say those who do not like it can move, consider those who might be in various places for reasons of business. ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [May 9, 2012, 12:33am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/95 "2012-05-09T00:33:41Z")
> [@Terr](#): > > Article 1, Section 8 of the Constitution. Out of curiosity, do you believe the post office should be privatized? ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [May 9, 2012, 12:40am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/96 "2012-05-09T00:40:03Z")
> [@Algorithm](#): > > I was more looking for an explanation of the “inherent” part of the term. One that doesn’t rely on the Constitution, since presumably your explanation of the inherently macro nature of those powers would justify their presence in the Constitution to begin with. “Foreign policy”. Meaning dealing, as a country, with those outside the country. As a country - inherently federal power. Regulating trade disputes between states has to be done by someone outside of the states. Inherently federal power. The military is an extension of foreign policy - see Foreign Policy above. Common currency - again, inherently macro, country-wide, and has to be done by federal government. What’s not clear about it? ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [May 9, 2012, 12:41am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/97 "2012-05-09T00:41:48Z")
> [@Ravenman](#): > > Out of curiosity, do you believe the post office should be privatized? Not without a constitutional amendment. ---
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [May 9, 2012, 1:01am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/98 "2012-05-09T01:01:02Z")
> [@Terr](#): > > Not without a constitutional amendment. No amendment would be necessary; Congress has the constitutional power to run a government postal service, but not any constitutional obligation to do so. (Whether they could privatize the Army raises a closer question.) ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [May 9, 2012, 1:18am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/99 "2012-05-09T01:18:05Z")
> [@Terr](#): > > Not without a constitutional amendment. That’s cool. ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [May 9, 2012, 1:45am UTC](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095/100 "2012-05-09T01:45:38Z")
Oh, but what about privatizing post roads? Does that require a constitutional amendment? [Previous page](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095.md?page=4) [Next page](https://boards.straightdope.com/t/no-income-tax-what-would-happen/621095.md?page=6)