What if WW2 have been voluntarily funded?
A thought experiment
Previous versions of this article have appeared at Downsize DC, the Zero Aggression Project, and WarTruth.org.
In terms of freedom and security, WW2 was mostly a draw. The United States defeated Hitler, but we also helped Stalin conquer Eastern Europe, invited him to occupy North Korea, and failed to block the birth of Red China. Only one thing prevents WW2 from being a complete defeat for freedom. The presence of U.S. forces in Western Europe deterred Stalin from rolling all the way to the English Channel. That's good, but the net result isn't great for so much loss of life, limb, and treasure.
I believe the U.S. could have achieved more with less expense. Only one reform was needed...
Replace taxation with voluntary funding!
Your brain is probably screaming now...
"Impossible!" Government can't exist without taxation! You can't fight a war with voluntary funding! Hitler and Japan would have conquered the world!
Please realize that 3/4ths of the war was funded through borrowing. People bought bonds they would later pay taxes to redeem. They were taking money out of one pocket and putting it in another. So the funding for WW2 was already quasi-voluntary. But I want to examine the following questions...
Could the funding have been made completely voluntary?
Would that have improved the result?
If you still think this idea is inherently unworkable, please consider...
Many possible things were once thought impossible.
People were certain that...
Crop growth required human sacrifice!
God (or the gods) would be angry unless we slaughtered small animals on an altar!
Civilization couldn't function without slaves. Slavery was the price (some) humans paid for other humans to enjoy civilization!
Women belonged in the home, subordinate to men. Patriarchy was fundamental to a functioning society!
The Berlin Wall would never come down in our lifetimes!
All those "certainties" were wrong. The fact is...
We humans are terrible at predicting what's possible!
We also wrongly assume the current system is the best we can do. Please realize...
Anatomically modern humans have been on the planet for 300,000 years, but our industrial-scientific civilization is only 200 years old. That means we're barely out of the crib! There must surely be new things to try. One way to explore the possibilities is by conducting thought experiments. For instance...
What if voluntary funding had replaced taxation and borrowing after the First World War?
As you read my proposed answer, please realize...
My point is NOT that things would have happened exactly as I describe, but rather that replacing taxation with voluntary funding would have forced politicians like FDR to be more creative.
The pressure to be creative could have led to better results. All humans perform better when they have to earn their money. The same is true for politicians, soldiers, and bureaucrats.
What would a voluntary funding system look like?
It could be a simple variant of the tax-withholding system we have now, but with one key difference. Imagine that Americans had the power to fill out a form each pay period to direct specific amounts to various government functions. Then ask yourself this question...
What would FDR have done about Japan under such conditions?
In our world, Roosevelt imposed sanctions on Japan for invading China. He had no constitutional authority to do this, but he did it anyway. Those sanctions eventually led to the attack on Pearl Harbor and the resulting war. That war caused the creation of North Korea, and perhaps even the rise of Red China. But...
Voluntary funding for the government would have made things more difficult for FDR. He could have still imposed his sanctions, but Americans who favored neutrality would have reduced their funding as a vote against his policies. Rule by decree would no longer have been an option for FDR. Every action would have carried a cost. So what would he have done instead, given the changed incentives?
Perhaps nothing. Persuading people to fund an intervention against Japan to protect China might have gone poorly. After all, China was ruled by Chiang Kai Shek, a murderous dictator who actually killed more Chinese people than the Japanese did. Some Americans in the missionary movement might have donated to defend Chiang, but their donations would have been countered by reduced contributions from Americans who favored neutrality. Under those circumstances, FDR might have adopted neutrality himself.
Would U.S. neutrality in the Sino-Japanese war have made things worse?
It's hard to see how. In our world, Mao ended up ruling China after the U.S. defeated Japan. Mao killed more than 50 million people. Would it really have been worse if Japan had prevailed instead of Mao?
Or what if stalemate had resulted, with neither Chiang, Mao, nor Japan winning the upper hand? That, too, would have been better than what happened in our world.
Korea
What if Japan had been able to retain Korea as a colony, because the U.S. didn't intervene in Asia? That would have been worse for the people who now live in South Korea, but better for those who live in North Korea. In the long run, Japan probably would have relinquished Korea, as happened with all other empires and their colonies. I think a few decades as a Japanese colony would have been better than nearly one hundred years of communist rule in North Korea.
Japan
In our world, Japan became a democracy after the U.S. defeated them. But Japan already had elements of democracy and maintained many democratic institutions during the war, though the military dominated. A Japan ruled by the military was a bad thing, but so was destroying every Japanese city, and losing more than one hundred thousand American soldiers. It isn't clear that using war to adjust Japanese governance was worth that price.
It seems unlikely that things would have gone much better or worse without U.S. intervention, except for two considerations. No Americans would have died if voluntary funding had compelled FDR to remain neutral, and all those weapons and soldiers would have then been available for use against Hitler.
What would FDR have done in Europe?
Voluntary funding would have constrained FDR in Europe just like it did in the Pacific. Every move he made to aid the British or oppose Hitler would have been punished by neutral Americans withdrawing funds.
Does this mean voluntary funding would have helped Hitler prevail? Not necessarily. It must be repeatedly stressed that Hitler was already doomed by the time the first U.S. soldiers landed at Normandy. So the real question we want to answer doesn't concern how to defeat Hitler, but rather...
How could FDR have achieved a better outcome under voluntary funding than he did under taxation?
What I would have done
I would NOT have tried to persuade Americans to fund an armed intervention. Instead, I would have sought opportunities to turn the German military against Hitler. Please understand…
Many German officers opposed Hitler. They made constant overtures for potential assistance against him. Various German officers conducted secret negotiations with the Allies from the early 1930s onward. If I had been FDR, I would have looked for ways to foster a German military coup.
Hitler was popular while he was winning. That made a coup unlikely or impossible. The situation changed when the Soviets gained the upper hand. I would have urged the German generals to better defend themselves in the East by ending their war in the West. To win peace in the West, the German officers would have to do two things...
Remove the Nazi regime.
Withdraw from every Western country they had occupied.
I would also have used Hitler's Jewish genocide as extra leverage.
FDR had early knowledge about Nazi plans to exterminate the Jews. He ignored it. That was a mistake, both morally and practically.
I would have talked about the genocide every day. I would have made it a source of global embarrassment for every decent German, in uniform or out. I would have constantly urged the German generals to end the genocide by removing the Nazi regime.
I would have publicly urged the British to drop leaflets in Germany, to expose the genocide to the German people.
I would have solicited voluntary funding to expand the U.S. military, not to fight, but to perform garrison duty in the Western countries after the Germans departed. My fundraising efforts would have met with some resistance from Americans who still favored non-involvement, but I think there would have been enough support for my narrowly focused goals.
I think my campaign would have fostered paranoia and sleepless nights among the Nazi leaders. That would have been worth it, all by itself.
It's possible, even probable, that my strategy would have resulted in no coup during 1942. But the tide would have turned by February 1943 when the Germans surrendered at Stalingrad. Worldwide humiliation over Hitler's genocide, combined with looming defeat by the Soviet hordes, would have spurred the German generals to act.
I believe this would have happened even though Hitler was constantly bribing the generals with money and estates to retain their support (this is why, for instance, the July 20, 1944, plot against Hitler was run by colonels, who had not been bribed). The generals could have just kept the bribes and deposed him anyway, or we could have offered counter-bribes.
Hitler's last day on Earth
I believe the German generals would have taken Hitler and Himmler and the whole Nazi gang out of their beds in the dead of night, stood them up against walls, and shot them. There would have been no chance for grand orations, scapegoating, or excuse-making at a trial. That's not the American way, but it's probably what the German generals would have done.
No Soviet hordes in Middle Europe
The German generals would have ended the war in the West and sent their soldiers East to stall the Soviet advance.
No more Holocaust
The German generals would have turned the Nazi concentration camps over to the Red Cross and other international relief agencies. Hundreds of thousands of lives would have been saved. Perhaps millions. And something of German honor would have been salvaged, too.
No D-Day
British, French, Canadian, and Polish troops would have landed in France without opposition. Voluntarily funded American soldiers would have been there with them. There would have been no need for a bloody invasion and no sea of graves along the French coastline.
The Russian Front
Negotiations to end the war in the East would have begun immediately. The likely outcome would have been a restoration of the old Soviet borders and the recreation of all the states previously conquered by the Nazis and Soviets.
A paranoid Stalin would not have risked his regime against a united Europe and America. With millions of German soldiers still on Soviet soil, more on the way, and the prospect of having to also face British, French, and perhaps even American troops, Stalin would have accepted peace.
There would have been no Soviet conquest of Eastern Europe, no Iron Curtain, no Warsaw Pact, and probably no Cold War.
What FDR did in real life
We did not get any of the benefits described above. Instead...
FDR placed a moral stain on the United States by allying with Stalin. He then condemned countless numbers of soldiers and civilians to death by unilaterally declaring a policy of unconditional surrender. He did this without consulting Congress or his allies. His action removed all hope of a negotiated settlement with the German generals, who now had little incentive to topple the Nazi regime. The result was more months of unrelenting carnage and the loss of Eastern Europe to communist tyranny.
Roosevelt had the power to pursue his boneheaded strategy because taxation made him largely immune from public opinion. His policies would be funded no matter how bad they were! Voluntary funding would have incentivized creativity and better results.
What would have been true then is also true now. Voluntary funding would give us consumer consumer-controlled government, leading to less tyranny and better outcomes. It's even possible that a regime of voluntary funding could actually make foreign intervention work in some instances. May we someday achieve this. In the meantime...
What can be said against my scenario?
I'm operating with 20/20 hindsight. I know what FDR's policies achieved. He did not know. He could only speculate and hope. I agree. It's also true of my scenario. I cannot be certain my preferred strategy would bring the outcomes I claim. I do not think this means the two strategies are equal.
His strategy had no moral component and made no use of incentives, whereas my approach does both things.
When a tyrant starts murdering millions of people, don't ignore it; condemn it. Do so constantly. Expose the crime to embarrass the perpetrators. Publicize their names, great and small. Describe their actions to the public. Shame their families. Invoke the judgment of history. Forecast future punishments by courts. Drive a wedge between the tyrant and his supporters. Foster resistance from the tyrannized populace and paranoia in the tyrant. Leverage the crime to topple the regime.
When you share an enemy like Hitler with someone like Stalin, do not ally with Stalin. Instead, sell your aid to Stalin in return for concrete concessions. Do not wait for the peace conference after the war; that will be too late. FDR and Churchill were largely impotent at Yalta, and the dispositions of the various armies on V-E Day made the final conference at Potsdam mostly irrelevant. Get what you want before you provide the aid. I describe exactly how FDR should have done that in my article The letter FDR should have written to Stalin.
Finally, do not demand unconditional surrender if conditional surrender could save lives, protect freedom, and foster security. All three things were still possible when FDR made his unilateral commitment to foreclose a negotiated settlement. It would have been far better to tell the German military that peace and amnesty were possible if they ended the genocide and killed the Nazi leadership.
Remember, taxation is both immoral and impractical. It is the modern equivalent of virgin sacrifice and all the other primitive assumptions humanity has overcome. Better results are possible through adherence to sound moral principles and the incentive-driven motivations of human psychology.
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Copyright © Perry Willis 2025
Perry Willis is the co-founder of Downsize DC and the Zero Aggression Project. He co-created, with Jim Babka, the Read the Bills Act, the One Subject at a Time Act, and the Write the Laws Act, all of which have been introduced in Congress. He is a past Executive Director of the national Libertarian Party and was the campaign manager for Harry Browne for President in 2000.