His idea is that in this way tax slaves would be able to reward government agencies for doing what they want done, and de-fund those they don't like. (Yes, this is a simplified synopsis.) In his view, this way, if the market is really better than government, government would fade away due to lack of funds.
Unless you are free to choose to send your "taxes" to a private enterprise instead of an "equivalent" government office, all the "tax" money will still end up going to government, and will be unavailable in the market. Unless I can fund the local militia instead of the Pentagon, how will my choice be honored?
Sure, I could send my "tax" money to the EPA instead of the Pentagon, but I can't choose an actual alternative to the Pentagon.
Considering this deeper: I don't want or need cops or the military. So, would any money I spend on guns, ammo, and training be subtracted from my coerced "tax" burden? After all, I am choosing to spend the protection money on the only one who really has any incentive to protect me and my family. Any money "taxed" from me is money I can't spend on my more personal defense.
If some government agencies end up completely unfunded and evaporate, that means the surviving agencies will be getting larger budgets. Agencies will always spend whatever is available. How will the total "tax" burden ever shrink? The pie will stay the same size (no, that is a lie. It will grow), but it will have fewer, larger, slices.
I'm sorry. I keep going back to this idea with the intention of finding some way to agree with it. I seriously want to like it. It seems so reasonable at first glance.
But the more I think about it the less I actually agree with it.
It's funny because this is the exact same idea I had when I was a teenager. I figured if I could pretend that every cent of the "taxes" I paid were sent to NASA (for example) I wouldn't feel so violated when paying. I could fund something I thought was doing a useful thing. (Yeah, I was terribly naive and didn't see what was really happening because of the government space monopoly.) I grew out of that notion fairly quickly as I learned and observed more.
I still can't make myself believe that theft is "better"- "less wrong"- when you can choose which thief gets the money, or that rape is "nicer" if you can choose your rapist.
I could, conditionally, support "pragmatarianism" as long as there were the option to opt out if you agree to use no government "services" [sic] unless you pay for them up front. But I would still consider those who funded government aggression and theft to be my enemy- guilty of violating the ZAP by sending others to use, or threaten, force against me.
*All government agencies named above are for illustrative purposes only. I have no intention of ever voluntarily sending any of them a cent.