Paying less taxes does not necessarily give you more freedom or happiness

libertyA few years back, I was invited to a business seminar. For the most part it was a success, as I learned things I might not have otherwise known. However, the speaker dedicated the last twenty-five minutes or so to talk to us about three forms of liberty. While his business advice was valuable, his political views were not only inappropriate, but dead wrong from my point of view.

The three forms of liberty he spoke of were financial, political and religious. He claimed that all three were tied together, in that you cannot have financial freedom without first having political freedom, religious freedom without political freedom, etc. Luckily for me (and him) he didn’t touch on religion much.

His main beef seemed to be the age old conservative ideology of government being too large. Smaller government with lower taxes gives us more liberty than big government with higher taxes.

He claimed that the less tax we pay the higher our standard of living will be. What most conservatives fail to realize time and time again, is that this line of reasoning is only valid for those who already have financial independence, which amounts to less than five percent of our population.

Say, for arguments sake, I make thirty thousand dollars a year, of which I pay five thousand dollars in taxes. If the government decided to cancel social programs in order for me to keep my income in its entirety, would having this new-found financial liberty make me happier?

Sure at first I could buy a better car, get a bigger TV or give a little more to charity. But my life would not change drastically for the better. What happens though when I get a hospital bill, need medication, or the local drama theater shuts down from a lack of public funding? My happiness and my way of life would decrease significantly.

liberty, taxes, denmark
Highest in taxes, highest in happiness

If the conservative “laws of liberty” were true, it might shock the speaker at the seminar to know that the happiest place on earth according to a Gallup World Poll published in Forbes Magazine is none other than Denmark. Denmark also just happens to be the most taxed country on earth, coincidence?

Finland, Norway, Sweden and the Netherlands round out the top five. “One theory why is that they have their basic needs taken care of to a higher degree than other countries” says Jim Harter, a scientist at Gallup. The Gallup researchers found evidence to support the theory that money does buy happiness. It all depends on what’s done with it. Scandinavian countries obviously have managed to raise the quality of life for everyone, while maintaining a very high tax rate.

Another myth about financial and political liberty that the speaker had wrong was when he said that the people of communist and autocratic countries have less money, mainly because their corrupt leaders drain their people dry with taxes. Truth is, taxation in many communist countries is less than what people think.

Vietnam for example has a lower tax rate than the United States. The few communist countries that are left have either a capitalist system or they are boycotted by the United States and other democratic governments. Cuba might be a very wealthy country if they had been able to trade with the US for the last 50 years.

A rich man complaining about having to pay a little bit for his success is as senseless as the conservative who wants to shrink the government, while at the same time bolstering the military with no immediate threat and no war on our soil in over two hundred years.

If I were wealthy, taxes will be far from my mind. Paying taxes is on par with donating to charity. I might not always agree with the cause my money is supporting; I’d prefer to boost our health care system then help build a hockey stadium without a hockey team, but at least I’ll be adding to someone else’s happiness.

Liberty, just like love, is in the eye of the beholder. It’s different for everyone, whether you’re a Ukrainian protester or a bum on the street begging for change. It’s all about how you feel.

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