Seems like a good template, to me.
One thing that could be done is to make a "Basic" and "Advanced" version of your system, there.
With regards to random events: covered in OA.
With regards to spying: covered in the DMG.
With regards to taxation: covered in Dragon #125.
I like the philosophy of a simple system, though, for game play.
The key might be to link everything to (A)D&D rules, in theory.
Prespos
Ps.
Some notes from "Armies from the Ground Up" (DRAGON #125) follow:
There are 4 types of domestic & foreign policy:
* Belligerent aggressiveness
* Passive complacency
* Active complacency
* Progressive consolidation
There are 4 types of tax policy:
* Oppressive: .45 gp / inhabitant / month
* Burdensome: .4 gp / inhabitant / month
* Conservative: .35 gp / inhabitant / month
* Liberal: .3 gp / inhabitant / month
* Progressive: .25 gp / inhabitant / month
There are 4 basic types of auxiliary forces a lord can have:
* fyrd
* militia
* yeomanry
* mercenaries.
The population of a realm increases/decreases with the passage of time.
Ps2.
An example: Helvetia has a population of 1,250,000.
A progressive tax rate (I've heard that Switzerland has low taxes) would result in 1,250,000 x .25 = 312,500 gp per month.
(3,750,000 per year).
Remember that this has to be divided among federal / canton / municipal coffers.
It's the division of taxes that interests me, here.
Ps3.
Note that there is another article in the same issue, that gives an alternate method for taxation, etc.