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Fallacies in Understanding Freedom

Politicians and their economist friends make careers out of espousing liberty and freedom and advocating actions that negate liberty and freedom. Liberty does not mean having the freedom to do what you want while forcing others to do what you want them to do. Liberty in a society has a characteristic that many people seem to find uncomfortable. Liberty means freedom for everyone. Every individual has the freedom to do what he or she wants to do, so long as they do not violate the freedom others. Everyone in a free society (including politicians) adheres to the principles of life, liberty, and property.

The very notion of any sort of an economic policy impinges on liberty in society. As Ludwig von Mises said, “Government is essentially the negation of liberty.” Any form of taxation consists of a violation of the freedom to property. Any form of regulation violates right of life or liberty.

Requiring a balanced budget by law violates the principle of liberty at its core. First, it connotes that a federal government should have a budget. Nation states use political means—not economic means—to allocate economic goods. A nation state can only confiscate and redistribute property. It cannot, and should not, budget disbursing resources it does not own.

Second, the idea of balance connotes that legitimate methods for eliminating differences between federal receipts and disbursements consist of either decreasing disbursements or increasing taxes. Only decreasing disbursements reduces the government’s violation of liberty. Increasing taxes consists of increased confiscation of property—a reduction of liberty. If taxes represent a violation of liberty, more taxes certainly do not mean less of a violation.

No advocate of freedom should favor any law that would increase the power to tax.




The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.

Henry Hazlitt
Economics in One Lesson