[ExI] state vs federal taxes, was: RE: self driving truck

[BillK]

On 31 October 2016 at 19:46, spike  wrote:
> The Federal government is a monopoly, but states must compete with each
> other.  Second reason: states are required to balance their budgets; the Fed
> is not and cannot.
>
> The competition between states lets state governments experiment, find what
> works.  Any USian is free to go to any other state, but USians are only free
> to go to another country if they have a lotta lotta money.  If you have
> plenty of money you are welcome anywhere on the globe you care to settle
> (except Mecca and the Vatican) but poor people are stuck as surely as if the
> USA had a high wall around it.
>
> So… my feeling is that the heavy lifting in government should be done at the
> state level.  Without competition, the Fed would just tax property, since
> that is where the money is.  With competition, we get legal structures like
> we see in California: high property tax but limited by constitutional law
> with 2/3rdles all the way down to protect it limiting the growth on property
> tax.  I like it.  That’s why I stay here.  This is the government I choose
> of all fifty.  I have little choice in the Federal government however: I am
> not rich enough.
>


The theory is nice, the practice not so good.

British local taxation hits the same problem. Poorer towns, counties,
states, can raise less money from local taxation but have greater
social needs.  So they also need grants from the national government.

BillK