Imperial Rome, Taxes, Governors and Geography

You’re familiar with the decades old anecdote comparing modern America to the decline and fall of ancient Rome. In 1903 when the West was near it’s peak of power and prosperity – and years before the problems we now take for granted – someone observed that 3rd century Rome was struggling to keep her frontier safe… that revenues were not keeping up with Imperial expenses.. and many were losing confidence in the old Republic. The Emperor created regional provinces to deal with problems that were increasingly beyond his grasp. The new Governors added layers of bureaucracy between the tax-paying citizen and the Emperor and often ruled despotically. Since they needed revenue to operate, taxes were raised and collected through increasingly aggressive means. Looking back, you might think they would have done more to protect and support the tax-base for long-term survival. But little thought was given to long-term consequences. Two reactions by the citizens… The birth rate fell because young couples didn’t think they could afford the cost of children, and had less faith in their leaders. Others tried to cash out and move to regions beyond the heavy hand of Imperial Rome. These reactions meant fewer male citizens available to join the Legions to protect the Empire. But regional governors didn’t care about the consequences. It’s said that the very last thing the Roman Empire was able to do effectively before it came to an end – was to collect taxes from its citizens.

The trend in wealth confiscation wasn’t confined to one party, or creed. Roman Emperors oscillated between Conservative and Reformer, Christian and Pagan, brilliant and ignorant. The political drift between “left” and “right” just kept going towards one place – the breakdown of the old Empire and its reformation into something new. The invaders: Goths, Vandals and other groups intermixed and assimilated into Roman ways as they displaced the old order.

Does this have any relevance to the West in 2021? Much of the political debate in the US seems focused on two political parties – two roads leading to the same place… as per the Roman model, a massive confiscation of personal wealth to fund the needs of government – regardless of any long-term consequences. Call it the great reset or re-imagining the economy or whatever else you want. Other debates around identity, or freedom of expression or right to self-defense have little meaning if you don’t understand the end-goal. Is this all going to play out like it did 1800 years ago? How would I know? But if you don’t spend some time thinking about historic patterns and how you might react to different scenarios, then you have no one else to blame when you’re caught flat-footed. It does seem that your choice of geography – the city and region where you choose to live – is one of the few things you can control that may have a long-lasting impact on your legacy.

We spend a lot of time in two major urban centers facing identical geo-political challenges: Washington DC and Toronto, Canada. When mayors and other urban leaders continued lockdowns in 2020, people in the city started snapping up properties within a two to three hour drive of the city. It didn’t matter where they lived any more since everyone was told to work remotely. If you have a one-million dollar bungalow on a 50 foot lot in the city, why not cash out and pick up a five-acre lot for half-the price in a district where taxes are lower and restrictions less enforced? As many are going from the urban center to the surrounding counties, there is another movement to regions over a thousand miles away. For example, a two-acre lakefront property in Ontario is likely in the $500,000 to $1-million range with property taxes north of $5,000 year. A similar property in Atlantic Canada might go for $100,000 and up with annual taxes around $1,000. For reasons beyond the scope of this writing, it’s unlikely that taxes in Atlantic Canada will rise at anywhere near the rates seen in Ontario and other regions.

Circling back to the anecdote of Imperial Rome, and the trajectory of the 21st Century.. your own interests are best served if you filter all current events through the prospect of taxes.. much higher taxes, collected in new, clever and aggressive ways. If this doesn’t pan out, then fine.. you’ll be better off. If it does pan out, and you took the time to strategize, then you’re better off. Oh, and choose your geography carefully. You can still pick up quality acreage in low-tax Florida for under $100,000. This used to be the case in Ontario but maybe not any longer. And you can pick up acres of ocean-front in low-tax Nova Scotia for under $200,000. Virginia is also an interesting study along this line.. Only a handful of her 95 Counties contain most of the people and money (revenue) that constitute the State. The Southern and Western region of Virginia is overwhelmingly rural, affordable and naturally blessed. We passed through Galax County last May when people were beginning to flee restrictive, high-tax regions of the nation, and were surprised by the number of license plates from California and other States. And on it goes...