Fairness and Theft
Posted by Brooklyn Young Republican Club
The most basic question is not what is best, but who shall decide what is best.
This apothegm, like many nuggets of wisdom you might have stumbled across whilst skimming your conservative friend’s Facebook page or Twitter feed, is a quote from Dr. Thomas Sowell, historian, economist, professor, and one of the shrewdest observers of human nature of the late 20th and early 21st Century. It popped into my head a few weeks ago while listening to This American Life, an extremely popular radio program broadcast on NPR, which usually devotes an hour to examining a topic of either topical or broad philosophical importance.
In this case, the subject matter was a fusion of the two, as Ira Glass introduced three segments that purported to explore the question of what happens when the public’s demand for services from the state outstripped the state’s ability to bankroll such programs. In other words, What Happens When You Run Out Of Other People’s Money, to paraphrase Baroness Streep.
This episode was bookended by segments about the parlous economic straits of two very different American cities. In Trenton, New Jersey the overwhelming debt burden-somewhere on the order of thirty million dollars, the last time I checked-as well as our prolonged recession has compelled the municipality to make deep cuts to local law enforcement. Consequently, the number of home invasions, robberies, rapes, and homicides has skyrocketed. Leaving aside the question of whether some of these crimes might have been prevented through defensive firearms ownership-perhaps the only thing urban politicos hate more than fiscal restraint is the Second Amendment-the producers of This American Life decided to explore how raising taxes could have prevented this calamitous situation from developing. The hero of this segment was a working class Trentonian who courageously volunteered to pay higher taxes if that meant that some services, such as sanitation and police patrols, would have their funding maintained or increased.
Another story critically examined the free market philosophy of Grover Norquist, president of Americans for Tax Reform, who believes that the problem how much wealth is being redistributed, but how much spending-or, in the case of the Federal Reserve, how much printing-is occurring in order to finance public expenditures. Of course, this being NPR-which is partially financed by taxpayers, irrespective of consent-the program was largely skeptical of this point of view. But the reason why Ira Glass & Co. were critical of Norquist’s anti-tax, anti-regulatory ideology was what really grabbed my attention. To wit, Norquist is wrong because progressive taxation in this country is no longer truly progressive. Due to the 2001 Bush tax cuts, which reduced the top marginal tax rate-it should be noted that these cuts also eliminated millions of lower income Americans from paying taxes altogether-affluent citizens, or the 1% if you prefer, were handing less of their income over to the federal government than at any comparable point in American history.
The story’s narrator contrasted this unfavorably with the 1950s, when the wealthiest Americans were forced to give in excess of three-quarters of their annual income to the IRS. Putting aside the fact that the wealthiest ten percent of the population pays over seventy percent of federal income taxes-according to the Congressional Budget Office-I take issue with the underlying conceit, shared unfortunately by a great many Americans, of the people who wrote this story. When asserting that the top twenty percent of the population owns over half of the nation’s wealth, there is the implicit assumption that this wealth is parceled out-and is therefore a creation of-the state. Yes, they “own” that wealth, but merely in a technical sense. In reality it is the nation’s, i.e. the government’s, wealth, and therefore its ultimate disposition should not be left in the hands of the people who generated it.
Unlike the redistributionists-which I don’t think is an unfair characterization of the people who work within public radio, especially this program-I don’t believe that the wealth you earned or created-or is voluntarily bequeathed to you by the person who has-is an extension of the state. There is no “fair” share that the wealthy-or the middle class, or even the poor-should pay if they came by it legitimately, i.e. by not forcibly extracting it from other citizens, because it is their wealth. Yet, even if you don’t share my perspective, and believe that the government must confiscate at least a portion of an individual’s earnings in order to bankroll “essential” services, is our current system truly “fair?”
Per Adam Carolla-whose insights might not be shared by the organic coffee and arugula set, but which are often more perspicacious than anything heard on NPR or or seen on PBS-wouldn’t a fair system of taxation require each American to pay the same rate? After all, the rich-such as Adam Carolla, Mitt Romney, and Barack Obama-would still forfeit an exorbitant portion of their income to the government-much more than someone in the bottom 10 percent. Unfortunately, this would not fulfill the main function of our current tax system, which is punitive in nature. See, the problem isn’t that taxes aren’t distributed equitably, but that a certain group retains too much of its own income, purportedly at the expense of other, less fortunate groups. I find it hard to believe that This American Life would devote a program to attacking the amount that was paid by the wealthiest Americans if they shared ninety percent of the tax burden, even though this would be manifestly unfair. The goal of state-sponsored egalitarianism is to punish those people whose wealth is ostensibly earned at the expense of the poor, while creating an artificial sense of equality, even if this means leveling rather than allowing those seeking to advance their fortunes to achieve wealth through their own initiative.
Much like Obamacare-which provides less health care at a higher cost and more inefficiently than any free market alternatives, all the while carving out exceptions for influential and wealthy rent seekers-the goal of our tax system is not to be fair, or to allocate resources more productively. Rather, the goal is to redistribute misery, particularly that experienced by the wealthiest Americans-although, as the Alternative Minimum Tax demonstrates, this is easier said than done. The next time a liberal pundit such as E.J. Dionne laments our “revenue problem,” remind him that the United States does not have a revenue problem. It has a government not respecting property rights problem. A subject that I doubt Ira Glass will be exploring for This American Life during next year’s tax season.
-Gerard J. Perry, Editor-in-Chief of American Rattlesnake.