In contrast to the latter, states do not finance themselves by selling products and services to customers who voluntarily pay, but by compulsory levies: taxes collected through the threat and use of violence (and through the paper money they literally create out of thin air). Significantly, economists have therefore referred to governments—i.e., the holders of state power—as stationary bandits. Governments and everyone on their payroll live off the loot stolen from other people. They lead a parasitic existence at the expense of a subdued "host population."

A number of further insights emerge from this.

Naturally, stationary bandits prefer larger loot to smaller loot. This means that states will always try to increase their tax revenue and further increase their spending by issuing more paper money. The larger the loot, the more favors they can do for themselves, their employees, and their supporters. But there are natural limits to this activity.

On the one hand, the bandits have to be careful not to burden the "hosts" whose work and performance make their parasitic existence possible so much that the latter stop working. On the other hand, they have to fear that their "hosts"—and especially the most productive among them—will migrate from their dominion (territory) and settle elsewhere.

Against this background, a number of historical tendencies and processes become understandable.

First of all: It becomes understandable why there is a tendency towards territorial expansion and political centralization: with this, states succeed in bringing more and more "hosts" under their control and making it more difficult for them to emigrate to foreign territories. This is expected to result in a larger amount of loot. And it becomes clear why the end point of this process, the establishment of a world state, while certainly desirable from the standpoint of the ruling gang, would by no means be a blessing for all of mankind, as is often claimed. Because one cannot emigrate from a world state, and hence, there exists no possibility of escaping state looting by emigration. It is therefore to be expected that with the establishment of a world state, the scope and extent of state exploitation—indicated, among other things, by the level of state income and expenditure, by monetary inflation, the number and volume of so-called public goods and persons employed in the "public service"—will continue to increase beyond any previously known level. And that is certainly not a blessing for the "host population" that has to fund this state superstructure!