Reduce Taxes BY Eliminating the Government Middleman

By Russ Minary | Guest Commentary, Rocky Mountain Voice

"The power to tax is the power to destroy." – U.S. Supreme Court Chief Justice John Marshall, 1819

In this article, I’ll explain and contrast how and why the American free market works differently and better than government (in many cases) using two free market American businesses you know: Amazon and Costco.

NOTE: I am a Constitutional conservative and enthusiastic advocate of the free market wherever, whenever and in whatever ways possible. I don’t oppose all government, just that which is redundant, costly, over-regulated, complicated, unnecessary, or too oppressive and costly. Which is most of it.

In the past, manufacturers, local retailers and their customers enjoyed friendly relationships. A middleman like a distributor was used to warehouse products which they would then sell and ship to local retailers or dealers who would sell to customers. Most distributors were profitable. But the internet and other technology made it possible for consumers to easily buy products directly from the manufacturer, eliminating many distributor middlemen. As a result, prices have come down and products are now more available to the average American.

Costco and Amazon offer consumers an amazing variety of products at very competitive prices. They are well-managed, customer-focused, profitable, publicly traded corporations in which anyone can purchase stock. They both grew rapidly and became very successful by: eliminating middlemen like distributors; listening to and knowing their customers; providing great service and products; and making it easy for customers to shop for and buy the products and services they want, online or in their stores. They frequently express gratitude for their customers’ patronage.

They are profitable in the most challenging of economic times. Transparency is the rule; you can easily find the names of corporate officers, plans, financial results and details of their operations like the names of store managers on their corporate websites.

Customers pay a single annual membership fee. The only taxes they collect are those required by and paid to the various government jurisdictions in which they operate. You are not compelled to shop or buy anything at Costco or Amazon. If you dislike them for any reason, you can drop your membership – without any penalty – and shop at the competitor of your choice.

Government works in an entirely different way.

It collects ever-increasing amounts of money from people via taxes and ‘fees’ (another name for ‘taxes’). Paying taxes is not a choice. As a taxpayer, you are compelled to pay taxes in varying amounts and forms. You pay taxes on your income, property, electricity, fuels, vehicles, water, transportation, communication and what you buy (sales taxes).

Local, Special Districts, County, State and Federal government uses your tax money to do things that are too difficult, complicated or costly for most individuals or smaller organizations in the free market to do. Good examples are military, law enforcement, fire protection; and construction and maintenance of infrastructure like water systems, roads and bridges.

Government agencies provide regulation or oversight of essential things like financial services, banks and healthcare. But they have often done that very poorly lately. Remember all of the multi-billion dollar bank failures, Enron, Bernie Madoff and the $35TRILLION national debt?

Of course, our government levies, collects and spends your tax money on things that you may neither want nor need. You either pay your taxes ‘or else.’ That ‘or else’ may include some combination of fines, criminal prosecution, endless and expensive litigation, confiscation or loss of property – or imprisonment.

Government, with few exceptions is: poorly managed, bloated, unaccountable, ignores its customers (the taxpayers who provide its revenues), and generates a staggering number and variety of laws, rules and regulations which are difficult or impossible for the average person to comply with or understand. It grows rapidly and regularly increases costs by adding: ‘middlemen’ agencies, programs, staff, and bureaucracies that are difficult or impossible to identify or monitor.

People who choose to homeschool or send their kids to private schools (at their own expense), or people with no children, must still pay taxes to support public schools, and their related personnel and programs. That makes no sense to me.

And government seldom if ever expresses gratitude for the tax revenues it collects. Remember when you got that nice thank you note from the government for all the taxes you paid last year? Yeah, me neither.

For more details on how Colorado’s government collects and uses your tax dollars, visit the Colorado Department of Revenue (CDOR) website: https://cdor.colorado.gov/

I know accountants who have a hard time keeping up with and understanding all of this stuff.

Every time the government starts another new program, department, agency or initiative – it adds layers, complication and cost to government. Money, in the form of tax revenues, is the food of government, so I think it’s time for the government to go on crash diet. Most (or many) things that are done by the government could be done more effectively and less expensively by private corporations in the free market – or eliminated entirely.

Last thought. Every year, American taxpayers work for about 102 days (until about April 12) exclusively for the government. The Tax Foundation (a nonprofit research think tank) estimates that Americans pay more in taxes than they spend on groceries, clothes and housing combined. Enough is enough.

Russ Minary is a retired sales executive, advertising and marketing consultant, small business owner and veteran. He helped businesses with hiring, talent consulting and organizational effectiveness before retiring.

Editor’s note: Opinions expressed in commentary pieces are those of the author and do not necessarily reflect the opinions of the management of the Rocky Mountain Voice, but even so we support the constitutional right of the author to express those opinions.