Daylight Robbery Review: How Taxation Shaped Our Past and Will Change the Future

Mish

Dominic Frisby wrote a fascinating book, "Daylight Robbery", that I just finished. I give it two thumbs up.

Daylight Robbery

In Daylight Robbery, Dominic Frisby takes you on a whirlwind journey through the history of taxation, from ancient Mesopotamia to the present day. 

From the French Revolution to the great wars of the Twentieth Century, and somewhere underneath you will find a tax story. Wars are made possible by taxes.

In a world on the brink of revolution and revolt, Frisby argues governments need to radically change who they tax and how if they are to survive.

Book Excerpts

Tax is power. Whether king, emperor or government, if they lose their tax revenue, they lose their power. This rule has always applied, from the first king of ancient Sumer to the social democracies of today.

Every war, from ancient Mesopotamia to modern Iraq, was paid for by some kind of tax. Taxes make wars possible. If you want to end war, end taxes.

The aim of every conqueror, from Alexander the Great to Napoleon and beyond, was to take control of the tax base : the land, the labour, the produce and the profits. Conquerors plunder and then they tax. ‘ Taxes are the chief business of a conqueror of the world,’ said George Bernard Shaw ’s Caesar.

‘No taxation without representation ’ was the cry of the American revolutionaries. Ruinous taxes levied by the tsar against peasant farmers led to the Russian Revolution. Perhaps most explicitly of all, the Philippine Revolution began with the Cry of Pugad Lawin, exhorting rebels to tear up their tax certificates. From Spartacus to Boudicca to Robin Hood to Mahatma Gandhi, the greatest rebels in history were usually tax rebels. History looks different when viewed through this lens of taxation.

Rulers have a long history of justifying taxes on moral grounds. Former Chancellor George Osborne ’s sugar taxes were introduced not for the good of government coffers, but for the good of your health. French president Emmanuel Macron imposed fuel taxes for the good of the climate. The spin is apparent even in the language of tax – a tax is your ‘ duty ’, your ‘ tribute ’, your ‘ due ’

In 1187 when the great Kurdish leader Saladin annihilated the armies of the Crusaders and took Jerusalem, the Christian cause was shaken to its core. There must be a new crusade, said the kings of England and France, and to pay for it Henry II levied a special tithe, the Saladin tithe. It was a 10% tax on revenues and movable properties, with special exemptions for the ‘ arms, horses and garments of knights ’ and the ‘ horses, books, garments and vestments, and all appurtenances of whatever sort used by clerks in divine service ’. Everyone else paid – though if you joined the crusade you were exempted, which proved an extremely effective recruiting tool.

War Costs Money

The greater the war, the greater the tax burden. The second World War gave the world even higher taxes. President Franklin D. Roosevelt said, ‘ War costs money.’

The real cost of war is perpetual debt.

Seeking to indoctrinate people about how to pay their taxes and to reduce public resentment following World War II, Secretary of the Treasury Henry Morgenthau Jr commissioned Walt Disney to make a film. It was called The New Spirit and Donald Duck was cast as the star. 

The US turned to other entertainers in its mission to promote the payment of tax not just as a patriotic duty but also as a joy. Irving Berlin wrote a song, which Gene Autry sang: 'I Paid My Income Tax Today'.

Inflation is Taxation by Another Means

Like debt, inflation may not be an official tax, but that does not mean it does not exist. Indeed, it is often deliberately propagated, and its effect is the same : it confiscates wealth from one group and transfers it to another – from the salaried or the saver to the state, from creditor to debtor, from employee to employer. It is ‘ a particularly vicious form of taxation ’, said economist Henry Hazlitt.

Milton Friedman was equally damning: ‘ It is a hidden tax that at first appears painless or even pleasant . . . It is a tax that can be imposed without specific legislation. It is truly taxation without representation.

Frisby claims war is mass murder funded by theft and that conscription is the moral equivalent of kidnapping.

Care to disagree? Then read the book. 

Tax reform is one of the few ways by which politicians really can change the world. 

How the Book Started

In addition to being an economic writer, Frisby is a stand-up comedian. His book started life in 2016 as a comedy show at the Edinburgh Festival called Let ’s Talk About Tax. 

Comedy gave way to a serious endeavor that took years to write.

Overlooked History

There is a tax story , often an overlooked one, somewhere near the heart of almost all of humanity ’s defining events. 

British inventor Michael Faraday explained electricity and the discoveries he had made about it to the Chancellor of the Exchequer, William Gladstone.‘

But, after all, what use is it ? ’ Gladstone asked petulantly. Faraday ’s response was immediate: ‘Why, sir, there is every probability that you will soon be able to tax it.

Jesus was only born in Bethlehem because Mary and Joseph were there to pay tax. And in 2017, Microsoft founder Bill Gates declared the robot that takes your job should pay taxes.

Get the book. It's educational and fun. You will enjoy it.

Mish

Comments (39)
No. 1-17
Six000mileyear
Six000mileyear

So gun control is really "aimed" at eliminating the ability to stage a tax revolt or election drubbing.

Eddie_T
Eddie_T

So...does the book also tell the story of how Milton Friedman sold the idea of income tax withholding to the US under than guise of patriotism, during WWII?

"I was an employee at the Treasury Department. We were in a wartime situation. How do you raise the enormous amount of taxes you need for wartime? We were all in favor of cutting inflation. I wasn't as sophisticated about how to do it then as I would be now, but there's no doubt that one of the ways to avoid inflation was to finance as large a fraction of current spending with tax money as possible.

In World War I, a very small fraction of the total war expenditure was financed by taxes, so we had a doubling of prices during the war and after the war. At the outbreak of World War II, the Treasury was determined not to make the same mistake again.

You could not do that during wartime or peacetime without withholding. And so people at the Treasury tax research department, where I was working, investigated various methods of withholding. I was one of the small technical group that worked on developing it.

One of the major opponents of the idea was the IRS. Because every organization knows that the only way you can do anything is the way they've always been doing it. This was something new, and they kept telling us how impossible it was. It was a very interesting and very challenging intellectual task.

I played a significant role, no question about it, in introducing withholding. I think it's a great mistake for peacetime, but in 1941-43, all of us were concentrating on the war.

I have no apologies for it, but I really wish we hadn't found it necessary and I wish there were some way of abolishing withholding now.”

A cautionary tale.

Eddie_T
Eddie_T

Looking forward to reading Daylight Robbery....but not sure how much I’ll enjoy it. I’m already have a whole lot of resentment around this issue. lol.

Remember Joe Stack. I don’t condone what he did, but I sure understand how he felt.

Mr. Purple
Mr. Purple

War is the health of the State.

War is a racket.

The power to tax is the power to destroy.

The State is stationary banditry.

Of all evils, war is to be the most feared, for within it develops the germ of all other evils.

Eddie_T
Eddie_T

I ordered the book on your rec, Mish....thanks.

Greggg
Greggg

Try this one. Written from references to historcal documents only.
Hidden History: The Secret Origins of the First World War
by Gerry Docherty, James MacGregor

amigator
amigator

If they were actually taxing us to the extent they are spending we would all be paying much more attention to what's going on.

caradoc-again
caradoc-again

Coming off the gold standard helped fund wars as it became much easier to issue paper debt. Along with that came inflation etc.

caradoc-again
caradoc-again

Render unto Caesar........
Doesn't apply so much if it has no emblem on it and is hard to seize.
That might just be a reason for the likes of bitcoin.
Man in Germany had his seized but the authorities don't have his password - he can access when he's free. Thats why the likes of Lagarde dislike it.

caradoc-again
caradoc-again

Frisby is an interesting character with some good stories like being ordered out of a Church for supporting Brexit and wanting to have some of his video shot there.

"we don't want your sort round here' - so much for politicised religion, another con like taxation, worthy of a book.

Rippletum
Rippletum

And so it goes. Mish is an anarchist with no sense of community. Taxes need to be collected to pay the bills. The bills are passed in the House and approved by the Senate. If you do not pay the bills you indirectly, unknowingly or intentionally support anarchy - Mish supports anarchy. If you do not agree on what bills are approved then either try to work within the system to elect persons that will spend funds on things you support or move to another country. The third option is to make all voting by for public office only by popular vote so no more 2 Senators per state (must be per capita like the House ), no electoral college and no filibuster - and if you do all of that we can then have a balanced budget amendment. Anything other than that, including the Republican plan/agenda to starve the beast which has been the plan since Reagan, is a recipe for a devaluation of the dollar and anarchy.

Call_me_Al
Call_me_Al

"Frisby claims war is mass murder funded by theft and that conscription is the moral equivalent of kidnapping."

In most places conscription is difficult to pull off these days. Back in the early days of WWI a good number of men on the fronts had no interest in being there, no animosity towards the grunts on the other side, and should have walked away en mass during the Christmas Truce. Of course when your government drops you in a foreign country surrounded by men with guns who don't take kindly to AWOL that is easier said than done.

threeblindmice
threeblindmice

Mish is back.

Realist
Realist

Just eliminate government completely and you eliminate any need for taxes.

The question is, would that eliminate fighting, violence and war? Nope.

More dumbing down.

Eddie_T
Eddie_T

I expect to pay taxes....what I object to is paying more than my fair share of taxes.

The people at the top have most of the wealth, and they don’t pay much....nearly half the people at the bottom pay no net tax....the people who make the high earned incomes but lack the tax protections afforded to the very wealthy pay far more proportionally than anyone.

And it bothers me that this impacts the most productive, hard-working part of our society. Anybody trying to better his or her circumstances runs smack dab into this....in order to beat it you do have to learn how to use the best tax reduction strategies that exist....otherwise you get hosed.


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