On Oct. 22, the eighth season of The Walking Dead will premiere on AMC for its 100th episode.
The series is based on Robert Kirkman and Tony Moore’s graphic novels depicting a zombie apocalypse and the stories of its survivors. At peak intervals, the Golden Globe-nominated series attracted as many as 17 million viewers and has spawned the release of an additional series (Fear the Walking Dead) and the talk show about both (The Talking Dead).
The success of the series is due in part to its captivating stories of survival, frightening zombie creations, and post-apocalypse villains and gangs.
At the same time, the graphic novels and television adaptation offer something much deeper. The story creates an unrestrained world, void of law and institutions, that tests the core of human nature, what we will do to survive, and how we strive to create order from chaos.
Within this system of anarchy, most of the characters formed small gangs. The more benevolent groups scavenged for resources, while the predatory gangs violently plundered weaker (or unsuspecting) groups. The most notorious such villain was the charismatic, eye-patch wearing ‘Governor’ who regularly dispatched and despoiled other camps.
The last season of the program, however, took a particularly inspired turn. As our main characters moved north, they found small civilizations hidden behind walls that repelled ‘the dead’ and enabled them to produce goods. But these more benign societies did not find peace; instead, a new type of predatory gang emerged.
Unlike previous bandits, the Saviors do not roam in search of communities to ransack, but prefer to subjugate the surrounding communities. Led by perhaps the most villainous antagonist of the series, Negan regularly takes half of everything his lieges produce in exchange for safety (mostly from himself).
Intentionally or unintentionally, The Walking Dead painted a vivid picture of the evolution and nature of government. In 2000, Mancur Olsen, and economist and social scientist, published Power and Prosperity: Outgrowing Communist and Capitalist Dictatorships in which Olsen describes similar gangs in early civilizations, or what he termed ‘stationary bandits.’
According to Olson, ancient roving bandits could destroy and plunder communities, but must continue searching for new groups to exploit. However, if bandits became stationary (like the Saviors) they could subjugate groups, offering protection from other bandits and themselves, and repeatedly confiscate a portion of their production.
This predatory nature of government is not just a problem for autocracies, but also democracies. Although (classically) liberal democracies have developed methods to constrain government powers through constitutional systems of rights, checks and balances, and other means, few if any have successfully placed legal limits on taxation levels and, therefore, only require a plurality to authorize any level of confiscation on production. As noted by one of our fictional characters in The Walking Dead, paying tributes to the Saviors is “like taxes.”
As Olsen explains, the trick for the “stationary bandit” or government is to find the right level of taxation that will maximize their revenues. More confiscation implies higher gains, but too much will suffocate the ability of subjects to produce.
The self-defeating problem of government over-confiscation is what the economist Art Laffer saw when, in 1974, he famously drew a simple graph on anapkin in a Washington, D.C. bar that would become known as the Laffer Curve.
According to Laffer, as a tax rate initially increases (from zero), so does the government’s revenues. However, these taxes diminish investment needed for economic growth, and some taxpayers will produce less while others invent schemes to avoid taxes or hide profits. Hence, as tax rates rise beyond a certain point, government revenues curtail until the profit curve reverses and eventually returns to zero when the tax rate reaches 100 percent.
As a result, in many cases lowering taxes can increase government revenues. It is this pro-growth rationale of the Laffer Curve that guided Regan era tax reforms and informs the administration’s proposed tax cuts.
Regrettably, because the revenue-maximizing tax rate is unknown, governments almost always overtax in perilous pursuit of revenues despite efforts to curb taxes. As a result, the most economically advanced Western nations run unsustainable deficits that, without formal constraints on the power of government to confiscate its citizens' production, will continue.
The success of liberal democracies is rooted in understanding the coercive nature of government. This ability to coerce is essential for many inherently public functions, such as national security, policing, justice, and some public utilities: these areas require a wider consensus, enforcement, and taxation. But, to the degree that an unrestrained power to tax extends beyond these areas (even with good intentions), the predatory nature of government emerges and inevitably chokes societal wealth and, in the process, its own revenues.
Alexander Ohlers, Ph.D. is a former senior analyst for the U.S. Department of State and the founding director of the International Human Development Corporation.