That's not strictly true, either. You have to have capital (wealth) to start a business.
There is not exactly a lack of capital. US banks are literally sitting on trillions of dollars, thats not the problem. The problem is the majority of consumers are broke.
The US government survived just fine without an income tax all the way up until 1913 and since then it's just been one excuse or another to keep raising taxes. Taking a third of a working person's income seems much much too high in my perspective, especially with the sorts of things I see it spent on (undeclared wars overseas, corporate subsidies, fat wasteful defense contracts, inefficient welfare programs, etc.).
Whether a third is too much or not you can debate, what really matters is what you get for your tax dollars. I actually dont mind paying over a third (in fact I pay about 50%) since I get a lot back for it. Decent infrastructure and public transport, excellent and virtually free healthcare, top notch and virtually free education and a social security system thats good enough to give me peace of mind even in difficult times. If I were to pay all that out of my own pocket Id likely end up paying more for less.
But if people want less of that for less taxes, thats fine. As I see it the major problem in the US is the political system that legalizes corporate bribery. As a result you have a government thats not working in the people's interest, but for special interests and your tax dollars are wasted and further enrich the rich. I can understand that breeds hate for government, but IMO the solution to that is not so much shrinking the government as fixing campaign financing and "lobbying". If one day you again have a government that is by and for the people, perhaps you may be less inclined to want to abolish it and end up with a Somalia style government-"free" country.