Before I get started I would like to say I am an advocate of a virtual, peer to peer currency and bitcoins to an extent. I think some of the worst aspects of capitalism as well as huge amounts of power have manifested themselves in the finance sector and it would take something as radical as bitcoin to take the power back.
I am interested in why anonymity is important in bitcoins. Some of the other "worst aspects of capitalism" are the tax dodging multinationals that lie and cheat and as a result prevent the fair distribution of wealth amongst the population. Surely if bitcoin was adopted widely as a currency this would only worsen matters as there could be no means of taxation and thus projects like public health, education and law would break down.
What is the problem with making transactions traceable. Would this not make a virtual peer to peer currency more likely to succeed?