Libertarians usually point to government as the source of high taxes. But in many developing countries it’s the family that is most taxing. In his amusing account of a "year in Casablanca," The Caliph’s House, Tahir Shah recounts what happens when his workers lost their homes and moved into his palatial estate.
I began to witness firsthand the ancient employment system of the East. It’s sometimes known as "living off Abdul’s job." As soon as someone gets work, everyone else gives up their jobs and leeches off the employed member of the family. The longer you are employed, the more money you need, merely to support the hangers-on. Anyone with a nice home and full-time job has a vast cast of characters living off them.
Before there were governments there were families that taxed (see Schoeck’s classic Envy: A Theory of Social Behavior for "taxation" in primitive societies). Creating a market economy is about much more than eliminating regulation.
Addendum: Michael Greenspan has another nice illustration from Rhodesia.
Sort of like noncelebrity versions of rappers or NBA players with their “entourages.”
This is freaky. People are stealing this guy’s examples.
http://groups.yahoo.com/group/leo-strauss/message/32324
In Cameroon, if a family member asked for money, you absolutely could not say no. Solution – as soon as you got money buy something with it. Here’s where it gets really interesting. Everyone bought the same thing – cinder blocks. Then they would trade them like currency. For some reason you’re brother had to give you cash if he had it, but he didn’t have to give you his cinder blocks which spent like cash.
I used to be taxed by my ex wife. After an experience like that, one starts to like the IRS.
“More concrete example”. Sheesh.
Seriously, however. I almost never see economists talk about transitioning a backwards economy. What policies can and should government enact to encourage the development of a free market economy in Cameroon?
Libertarians should consider how they would transition an entire world with such an economy.
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