Any thoughts on Milsted's arguments?
Milsted takes the case of national defense, which is commonly considered an institution that would face the free rider problem if supplied on the market. Argues Milsted: "suppose the majority assesses a tax on everyone to spread the burden of supporting the new defense system. This is theft of the minority. However, suppose that the economies of scale are such that this tax is less than half of what people would have had to pay for defense on their own."
That's the argument, plain and simple. If it is morally permissible to steal when the victim is compensated double, the equation seems to fit.
"Any thoughts on Milsted's arguments?"
I don't see a need to use some arbitrary threshold to decide an issue like this. To me, it is far simpler. The rules, the Constitution, allow for the imposition of taxes to support certain enumerated powers. The rules allow for almost every one to participate in the selection of those who decide the tax levels and the allocation of the taxes. We are all free to debate and vote on this process. As long as the rules are followed, then the process is 'moral'.