Dear Emile and Godfrey,
I think the reason that Mises did not address taxes in either Liberalism or Human Action is that both are about production and not about spending.

We Austrians know that government must exact a tax for what it spends. There is no avoiding this iron law. If government is limited to its proper role of protecting life, liberty, and property, just about any broadly based, transparent tax will do. This is why I do not get too involved in arguing for tax cuts as long as it has budget deficits. Who are we kidding? If the government spends it, it must exact a tax at some point. Of course, today that tax is the silent tax of the loss of purchasing power, so debt may be repaid but it is done so in dollars of diminished purchasing power.

At last year’s Mises Scholars’ Conference in Auburn, AL I argued that in a sound money environment government spending is restrained by natural forces. Since government cannot print fiat money, it must either tax or borrow honestly for every penny of spending. There is only so much tax that the public will tolerate and increased borrowing drives up the interest rate, throwing the real, productive economy into recession or worse. In an economy with unsound money it there is an appearance that there are unlimited resources. If government wants something, either for itself or to transfer to others, all it has to do is print more money.

It’s criminal and the perpetrators should be prosecuted!


From: Emile Woolf <>
Sent: Wednesday, March 8, 2017 7:33 AM
To: Patrick Barron
Cc: godfrey Bloom
Subject: Re: Media Interview Request: Patrick Barron, Mises Institute

Dear Pat

I relished every minute of it. Melanie was obviously something of a convert to begin with!

I am re-reading “Liberalism” right now, and getting far more from it than the first time.

As you know, I have always had an intense interest (shared with Godfrey, among others) in identifying a just and sane system of taxation to replace the current insanity of “if it moves, tax it”, which is utterly unprincipled and patently counterproductive. It is interesting that “taxation” does not even figure in the index to “Liberalism”.

I suspect that the reason for this is that under Liberalism, government’s role would be limited to the protection of life and property which, in the scheme of things would require resources so slender that they would hardly be a significant issue. Yet, as you know, Henry George’s writings were devoted to this topic and he (and David Ricardo before him, I believe) were able to identify the “economic rent”, the surplus that arises quite naturally from differential productivity of land, as the natural fund from which tax could be taken without injustice or rancour.

Given that “rent” has so many unfortunate connotations these days, I took to “added value” as a preferred epithet in my own writings, because it has the same differential quality as economic rent (as understood by Adam Smith, Ricardo, Mill, et al) in that it reflects “taxable capacity”. Indeed, when Godfrey asked me to draft an outline of the tax system to be promulgated by UKIP when it existed in its sane incarnation, this is the principle that guided me, and I hope I’m not misrepresenting Godfrey in suggesting that it underpinned the policy that then appeared on the UKIP website and accorded with his belief in a business tax that applies a low, flat rate to a wide base.

Similarly, the same principles guided me in my discussions with the Hon. Al Ullman (then Chairman of the House Ways & Means Committee) in the US in 1980, which led him to abandon his Tax Restructuring Bill that would have imposed VAT as a federal tax. I was at pains to point out to him that VAT as applied in the UK, France and elsewhere, is an unmitigated disaster, a travesty that acts as nothing more than an utterly indiscriminate and inflationary sales tax, and that my use of the term “added value” could not be more different.

Your view on why Mises, in both “Liberalism” and in “Human Action”, makes scant reference to taxation, would be most welcome. As you see, I’m copying this to Godfrey.

All best wishes


Emile Woolf
Visit my website

On 6 Mar 2017, at 17:59, Patrick Barron wrote:

The sound quality wasn’t the best, but it gets better as the interview progresses.

Start at the 12:45 minute mark. The first part of the interview ends at the 35 minute mark. The second part starts at 40:15 and ends at the 52 minute mark.

Fun for the whole family!!


From: MoneyTalkwithMelanie <>
Sent: Monday, March 6, 2017 11:06 AM
To: Patrick Barron
Subject: Re: Media Interview Request: Patrick Barron, Mises Institute

Thank you for your appearance this morning. Here is a link to the podcast. Great job!



Patrick Barron from the Mises Institute. “6 Steps Toward a More Sane Economic Policy”

On Sun, Mar 5, 2017 at 3:16 PM, MoneyTalkwithMelanie <> wrote:
Fantastic! I look forward to a lively conversation! 🙂


On Sun, Mar 5, 2017 at 8:11 AM, Patrick Barron <> wrote:
Dear Melanie,
Yes, I’d be honored. The land line to my home in West Chester, PA is 610-793-3605.