Monday, March 23, 2009

Representation and Taxation

I had a little epiphany just now: it's not taxation that necessitates representation, it's economic entanglement.

Sure, in the American colonies taxation was the flash point for revolution. It wasn't, however, the real problem: the real issue was that America was being run as a raw resource exporter/finished goods importer to drive England's economic growth. The taxation of tea was just one of dozens of ways the colonies were milked for wealth. For every cent of taxation, dollars and dollars were extracted via private companies: furs, timber, slaves, sugar, and so on. Taxes were just the government's way of skimming a bit of those massive privatized profits off for itself.

At that point England's economy was built on the backs of its colonies and outposts in America, Asia and Africa. Together they constituted a single economic system: without the colonies to provide resources and markets, England's domestic economy would have collapsed, and the economies of the colonies were similarly dependent (deliberately and systematically so) on England for essential goods. And that's where the lack of representation became so pressing: As long as political power was concentrated in the hands of the English, they had every incentive to design a system that rewarded only themselves. Only if political power is distributed throughout the whole economic tangle is there any political incentive to spread wealth with anything approaching fairness. Economic involvement without representation leads to exploitation.