(2) Is Taxation Theft?

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Continued from here.

I agree with you and Ha-Joon Chang, with one exception: the function of taxes is not to fund government - the state has no need for that as it can create as much money as it likes (unless it gives up its ability to issue its own currency, as the EU-member states have foolishly done). 

One of the functions of taxes is to ration purchasing power, so that the non-government sector does not have the ability to buy up all the economy produces, leaving some of the output pie to be acquired by the state.

Put differently, the state does not have to ask you for money so it can spend. 

Rather it has to be able to constrain our (non-government's) ability to buy up all there is on offer, so that something is left over for the state.

Also taxes may be lowered or increased to regulate the economy's temperature, as it were.

Apart from what you mention in your piece, another function of taxes is to lend value to the currency. The government forces you to attach value to its currency as you need to obtain it to pay taxes (and typically use the national currency in many other ways, settlement of debt, for instance).

That is what MMT argues, and it strikes me as correct, at least for the time being. One never knows what new insights might come one's way. 

Whether the coercive constraint of our purchasing power is theft or not depends entirely on one's assessment of the political system within which government operates and the uses that government makes of its enforced purchasing power.

For instance, if you accept the framework (constitution, laws etc.) within which government operates and government complies with these restrictions and entitlements, then taxation is not theft. Some of governments' actions may not comply with these constraints, in which case government's enforced purchasing power may be considered not necessarily theft (illegitimate taking) but a case of misappropriation (illegitimate application/use).

That is why I tend to think that the issue is not so much theft but — neglect — the legitimacy/lawfulness/constitutionality of the uses made by government's ability to enhance its purchasing power by rationing ours.

Of course, misappropriation can take on the character of outright theft.

All in all, in principle, taxation is legitimate and does not constitute theft for the reasons that you explain. But in particular cases the use  - or better abuse - of "tax money" [to avoid my clumsy but, I think, correct wording above] may represent misappropriation or even theft [when the taking is illegitimate as may be the case when a federal state imposes an unconstitutional tax], when "tax money" is raised for certain authorised purposes but applied to other, unauthorised purposes. 

After all, what is theft but the illegitimate taking by A of something from someone else (B). If A is entitled to take something from B to affect X but not Y, then in taking something from B to affect Y is an illegitimate taking from B, and in this sense theft. 

The matter can get very intricate, giving rise to more or less subtle legal distinctions of forms of theft or acts similar to theft but not equal to it.

Continued here.