I wonder why there hasn't been an attempt at making a country where regulations are kept minimal and taxes nonexistent or only dependent on what you use.
It would probably attract a ton of economic activity. Does it exist?
edit: rephrase
It would probably attract a ton of economic activity. Does it exist?
edit: rephrase
Other countries have different rules that apply to their citizens and also to residents.
Generally speaking I think it's far better too focus on making the money more than mitigating the tax.
So while I believe there is no moral obligation to pay more tax than legally required, you would have benefited from the tax of previous generations so why should you have a free ride?
Is there another choice?
For instance, if the initial population of such a country all sat down together and agreed on what level of social support they would want if they happened to be born with below-average IQ, having some severe physical disability, being suddenly unable to work, having a special needs child whose care cost more than their own annual wages, etc., then the rules of the game could be set up in a sustainable way so that generation after generation there would not be the same sort of market for social entrepreneurship intended merely to achieve after-the-fact wealth redistribution, since a fair system would have been baked in from the start.
I don't think this is so much a classic market failure as it is a failure of human brains to perform counter-factual reasoning.
Also, values change over time. What is viewed as a fair system now might be viewed very differently in a 50 or 100 years, all else being equal.
Probably the biggest way of avoiding tax and regulation these days is to be multinational. Then no one country can really control you for better or worse.
Would they ask everyone to please be nice?
Unless the libertarian utopia/dystopia referenced above were to nationalize the economy of it's residents (not likely) I don't see a way for that government to nurture productive commerce and protect that commerce at the same time.
It fails to account for lots of things, among them:
- The idea of unspecified "regulations" inflicting grave damage on the economy for no useful purpose is simply wrong. Yes, there may be regulations some people consider too broad, or intrusive. But it's a question of degree, and I assure you, you wouldn't want to life in a place without any of them. The best case scenario is that instead of a law that forbids the use of lead as colouring agents for potato chips, you'll get a less-effective, more expensive private certification scheme with the same rule.
- Corporations only pay taxes on profits. As such, these taxes have no effect on the corporation's investments, research, or other spending.
- Governments tend to be more effective in spending than private companies. Medicare % medicaid, for example, have something like 1% or 2% of administrative overhead, compared to roughly 20% of overhead and profits for private insurance. As further evidence of the stinginess of governments, compare the average desktop PC in government offices to those at your favourite company.
- Such a country could reduce spending almost exclusively by picking and choosing the people to admit, leaving other countries to care for poor, old, or sick people.