You have surely heard similar “masterpieces” of statist thought. As soon as you mention that the state skins an ordinary worker alive through taxes, excises, and levies, a defender of the “strong hand” immediately appears. They confidently declare that if, for example, VAT were abolished or levies reduced, ordinary people would not become wealthier, because capitalists are just waiting for this to instantly rewrite the price tags on bread, gasoline, and sneakers by exactly the amount of the savings obtained. But let us take this fairy tale apart piece by piece, because there is certainly very little common sense in it.

Let us start with the fact that a commercial firm does not wait for a tax cut to suddenly begin maximizing profit. It tries to squeeze out the maximum right now, every second. Why does a cup of coffee at the local coffee shop cost 200 rubles instead of 800? It is not due to the barista’s boundless love for the proletariat. The price is held back by three market forces.

First of all, there is a competitor across the street who would gladly brew you coffee for 190 to take your money instead of them. There are also substitute goods (buying a jar of instant coffee, brewing tea in a thermos, or grabbing an energy drink). Finally, you have the right to tell the coffee shop to go to hell and not buy anything at all.

As we can see, if a seller can raise the price tomorrow without losing customers, they will do it today. If they haven’t done it today, it means the market does not allow it.

Regulation enthusiasts also sincerely believe in the myth that the price of a good is equal to the sum of all the money remaining in the buyer’s pocket. If this were true, in low-tax countries, absolutely everything would cost many times more by the magnitude of the tax savings. But reality works exactly the opposite way. In low-tax Dubai, electronics and cars often cost much less than in highly regulated Europe, where a massive VAT, draconian duties, and packaging environmental disposal fees are tacked onto the price.

Taxes are costs. For you and for business. When taxes decrease, the production and delivery of goods become cheaper. And in a free market, an enterprising rogue is instantly found who drops the price by 5–10% to lure away every single customer in the area. It is precisely the thirst for profit that forces capitalists to compete for your ruble and drive prices down, rather than orchestrating Masonic cartel conspiracies.

There is also one interesting paradox. The very same person who demands that taxes not be touched, otherwise businesses will immediately hike prices and take everything, literally in the next message claims that to improve people’s well-being, one should simply raise the tax-free minimum, introduce benefits, and distribute targeted subsidies to people.

That is, if officials stop taking 300 dollars from you in taxes, greedy corporations will instantly take them through price increases. But if those same officials leave you with that 300 dollars in the form of a “state benefit” or an “allowance,” will corporations suddenly go blind, feel shy, and pass you by? What magic sensor in the pocket of an ordinary worker distinguishes a “dollar from a tax cut” from a “dollar from a social handout”? Why is it that in one case businesses immediately devour everything, but in another, they submissively leave the money to the person? There is no sense in this.

In short, this whole tale relies on deep-seated paternalism, suggesting that someone must rob a person who has no other options. Either the home state (allegedly for the common good), or an evil merchant. However, the difference is fundamental. The state takes your money under the threat of prison and a baton—you have no “unsubscribe” button. But you give money to corporations voluntarily. You vote with your ruble. If a supermarket triples the price of buckwheat, it will be left with a rotting warehouse and a hole in its balance sheet, because people will go to the neighboring stall.

The more money ordinary people have, the more power is in their hands. The power to accumulate capital, to invest, to support honest producers, and to punish arrogant monopolists with their rubles!

Voluntarist, Bitarch