I asked an avowedly apolitical friend, who lives and works in a circle of leftists, whether any of the friends I met through her expressed disapproval of my politics to the extent of trying to avoid my company. She said no, but one of the friends told her that he would rather avoid talking to me about taxation in particular because he finds the immorality of the libertarian position on taxation very upsetting and worries that he cannot keep his cool and civility talking about it.
On the other hand, my posts on taxation (linked to at the end) elicited comment from the other end of the morality question:
“If we are to come up with a solution to a problem, then, first, we must both agree that there is a problem to be solved. That implies that we both see the problem. If only one of us sees the problem and comes up with a way to fix it, regardless of how perfect the fix is and how attractive the benefits are, the person that does not have a problem in the first place will not care about the fix at all and their own time would be better spent shooting holes in your solution. By having the agreement that there is a problem that needs to be fixed, you’re getting them to put away their guns, the guns that they would otherwise use to kill your solution in the bud.
If people don’t see taxes for the evil that they are, they will not be compelled to change the status quo in any way. And seeing “spending” as the evil is much harder to convey because “spending” doesn’t have any direct negative effects (except for the robbery committed in the name of funding it).”
I mostly agree with Valentin’s highlighted statement, but the point here is not to defend my previous posts on the subject. The point in questions is this apparently unresolvable conflict hidden in the agreement: morality.
Both the left and libertarians formulate their position on taxation in terms of morality.
These moral positions are mutually exclusive and may prove to be very difficult to resolve. Not impossible, but requiring a somewhat more involved exploration of the subject. My aim is low; all I will try to show is that there is a vast field of practical moral questions between the ideological extremes.
But let’s start with the various moral justifications.
The socialist claims
A couple I have discussed the matter with a while back, gave me perfect examples of the two most prevalent arguments for the kind of social arrangement we have.
The social contract
She, a government employee for all her life, sees taxes and government services in general as part of the social contract. Being born in a society makes you a party to an implicit contract. For socialists of all colors, taxation is an inevitable part of coexistence. The explanation is simple: living in a society means that we have to take care of our shared expenses, we have a moral obligation to be our brothers’ keeper and we have to share this burden ‘fairly’. She considers tax avoidance and the underground economy the gravest moral problem of the society she lives in.
Her husband sees the state as a provider of services. His attitude could be summed up like this:
“My time is precious to me, there are certain things I do not want to be bothered with. I pay my taxes gladly to have someone to take care of those things. The more things are taken care of for us, the better off we all are.” He is even willing to live with the acknowledged inefficiencies of government services, which he considers a small price to pay for our care free existence. Allowing anybody to desert the system will make it fall apart. Coercing deserters is a moral act in the name of the greater good.
Taxes as the social peacemaker
Another acquaintance, a starving artist/semipro shoplifter/welfare bum was the bluntest about it.
“I should be happy for the welfare state”, he explained to me, because that is the only thing that keeps people like him from coming at me with the baseball bats to take what they need by force. While only a few would be so blunt about it, the idea that taxes and governmental income redistribution is the price we pay for our standard of living is fairly common, especially among the middle-class. For well meaning people, paying taxes is penance for the sin of having more than some others.
“Taxation is the price which civilized communities pay for the opportunity of remaining civilized” – Albert Bushnell Hart
“I like to pay taxes. It is purchasing civilization” — Oliver Wendell Holmes”
People are stupid
Nobody puts it so bluntly at first, but it is very easy to pry this most commonly held belief out of socialists in any argument. People in general cannot be trusted with making decisions about important things even (and especially) if it involves their own lives, because their judgment is clouded by short term self interest. Taxation is necessary to save people from the consequences of their selfish and stupid decisions. The more complicated our world is becoming, the more we need to rely on experts, the more we need to make decisions at an ever higher level, by ever more knowledgeable experts whose only interest is to make the best possible decisions for everybody. Coercing people for their own good is a moral act.
The morality of social cohesion
Socialists believe that the system itself cannot and should not be questioned as it threatens the very existence of civilization. Once we, meaning a democratic majority, decided that something – anything – is a ‘public good’, questioning that decision or refusing to financially supporting it should not be allowed.
Good socialists think that you are immoral and selfish if you pay your taxes grudgingly and they consider any opposition to government run services as a hostile act, an attempt to destroy the very fabric of society. Taxes, the government and the state are the things that hold our world together.
Opposing and questioning them is an immoral act.
All of the above arguments are fundamentally flawed, but let’s discuss them later. They are all based on an idealized vision of society that can only be maintained through enforced social cohesion. They see submission to the will of the majority as the ultimate civic virtue.
That is what libertarians have problems with.
Libertarian claims to morality
The non-aggression principle (NAP)
The non-aggression principle is the foundation of libertarian morality and taxation is the most obvious violation of the principle. Taxation is an expression of power, NOT an act of cooperation. Individual charity, social cooperation, mutual aid, commerce, the free exchange of everything is what makes freedom moral. Taxation is coercive, it violates the non-aggression principle and therefore we cannot even talk about ‘fair’ level of taxation without acknowledging its fundamental immorality.
The state, its services and enterprises have a corrupting effect on both society and the individual. The bigger the state, the stronger the effect.
What enables this corrupting effect is taxation, which is therefore immoral by extension.
Just about everybody knows that government services and government run enterprises are less efficient than their private equivalents. The bigger the state, the more poverty it creates. Creating poverty is immoral, enabling the creation of poverty is immoral.
Socialism is immoral in many ways and taxation is not the worst. When libertarians confront socialists on taxation using the NAP argument, they are setting themselves up for failure as socialists have absolutely no problem with violence if it happens in the name of the “greater good”, which, of course, is always defined by them. My questions therefore are practical.
My questions to socialists
How much is enough?
Either in absolute terms or in percentages. The government’s share of the GDP was less than 10% a hundred years ago. Today it is over 40% in most developed countries and over 50% in some. How much is enough? The more the state gets, the louder the demands for more become.
A few years ago, talking about some present day American tax debate, arguing for another tax hike, the speaker quoted the democrat congressman William Jennings Bryan, who said in the course of the debate of the 16th amendment in 1913 that:
“Of all the mean men I have known, I have never known one so mean that I would be willing to say to him that his patriotism was less than 2 per cent deep. If ‘some of our best people’ prefer to leave the country rather than pay a tax of 2 per cent, God pity the worst.”
When the income tax was introduced, the less than 2% tax affected less than 1% of the population. In 1916, only three years after its introduction, the top rate was raised to 77%. I don’t know what Representative Bryan said about that, but apparently, the expectations of patriotism can have a pretty wide range. I am very much of a patriot at 2%, but at a certain point my patriotic fervor may start to diminish. The socialist speaker in the nineties, who introduced me to the quote, did not seem to notice the irony in arguing for a 70%+ deep patriotism with a 2% deep patriotism quote. Whatever the depth is, socialists will keep using this virtue signaling argument.
I would like to know at what point can a socialist find it morally acceptable joining the movement Taxed Enough Already?
Socialism is like a parasite: it is doing well as long as the host is strong and healthy, but since it does not know how to stop sucking the life out of its host, eventually it kills it and itself with it. The story is the same everywhere: Detroit, Greece, Venezuela, all of the officially communist countries in history. Socialism always ends in misery. Where is the morality in that?
What is a FAIR share?
I could also ask about the nature of fairness when socialists like Hillary Clinton or Bernie Sanders ask the rich to pay their fair share. But how much is fair?
The top 1% pays 43.6% of all income taxes meaning that they pay 43.6 times their fair share.
The top 0.1% pays over 200 times their fair share.
What is the multiplier a socialist can consider fair? Why is it that shortly after a new level of “fairness” is reached, it is deemed to be the new not fair enough?
Why no choice?
There is no government service that works more efficiently than its private equivalent would.
There is no government program that can produce better results than its private equivalent would.
I could go on with questions about every government service and program to demonstrate the points above, but the problem is not the left’s inability or unwillingness to accept the facts.
The problem is that leftists force their decisions on the rest of us. No school choice, no health care alternatives, no private pension. All of these things are paid from our taxes and there is no way to opt out. The left understands clearly that anything they have to offer is inferior to free-market alternatives, that is why they insist on taxpayers funded monopolies. Where is the morality in that?
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Objections against taxation should not be primarily conceptual. Disagreements over concepts (NAP vs. majority rule) are more difficult to resolve than the relative merits of options (private vs public schools).
Yes, the very concept of taxation is immoral, but there are more arguments against the ways the money is spent than the ways it was raised. Such arguments also have a better chance of finding agreements with those who vehemently disagree with the foundational concepts.
Yes, leftists are immoral, but they are also ill informed, full of contradictions and hypocrisy.
Why not focus on that?
Origins of the Modern Income Tax in Tax Lawyer Winter 2013.pdf
Taxation history of the United States – Wikipedia
Government spending – Wikipedia
US Government 20th Century Spending History with Charts – a www.usgovernmentspending.com briefing
Analysis of the 1916 income tax returns