Reacting to my previous post analyzing the President’s statements Friday last, Burt Likko could not “reasonably understand Obama to be arguing for a proposition to the effect of ‘Everything belongs to society ab initio, so the government should be able to take, that is keep, what it wishes from anyone.’” Mr. Likko asks if we couldn’t avoid coming to such a radical conclusion by instead positing that the President was simply offering an argument in favor of progressive taxation. As I explain below, we cannot.
First, I again note that the President has omitted from his case any compelling need for the increased taxation. If the President believed that individuals had a right in their earnings, he could only deprive that right by offering a justification. He offers none. Were we talking about a different kind of moral case, e.g., that a certain form of human suffering will occur but for higher rates of taxation on a group of people, that would be very different. But he does not point to anything amounting to a moral justification. His campaign thus far has not even been about taxing for the purpose of spending. It’s been about taxing, period. This alone proves the President does not believe that individuals have a right in their earnings. If he did, he’d be forced to offer a justification before taking them other than via a progressive tax. I will explain further below.
To head off an objection, it is true that the President frequently appeals to “fairness.” This is unavailing. Indeed, the standards of fairness and justice are what compel the giving of justifications in the first place. That “justice demands it” is question-begging that does not amount to a justification. If the President is truly concerned about fairness, he would offer a justification for his proposed deprivation of property out of proportion with similarly-situated Americans. Again, the fact that he has not underscores the fact that he does not believe he is contending with a right, which would compel him to do otherwise.
Thus, the President’s implicit contention must be that people do not have a right in their earnings to begin with, or at least to some portion thereof. Following this logic and the President’s other statements, such a right does not vest until individuals first “pay theirfairshare.” His presumption is that the market does not legitimately or correctly apportion earnings and dividends to individuals, because, for example, it fails to adequately account for government’s investments through infrastructure and subsidies and a healthy demography, and so on. For most Americans, a paycheck reflects the real net value derived from your labor. You then pay taxes out of your property to the government, perhaps begrudgingly, as part of your civic duty, as part of the civil compact, as a wholly separate and independent obligation from the particulars of your economic life. For the President, in contrast, part of your paycheck—a quite substantial part, possibly—reflects value that you could not have derived, could never have derived, but for the infrastructure the government provides. That portion was never yours to begin with. You simply hold it in trust for the benefit of your co-investor, the collective, the government, the owner of the means of production, with whom you “do things together.” The government provided that infrastructure as an investment in the enterprise, the economy, in which you toil—not as a passive, disinterested agent, but as an active partner, your joint venturer, whether you knew it or not. You may not be interested in infrastructure, but infrastructure is interested in you.
Paying taxes, then, is nothing to begrudge as far as the President is concerned. It’s simply the way we “fairly” distribute the part of our collective revenue that happened to be paid in your name. But it is only nominally yours. It equitably belongs to us all, each of us as shareholders in our joint venture, our grand corporation, U.S.A., Inc.
That is the only moral logic that comports with the President’s own statements. It’s radical, yes, but not so out of line with what the far left believes. And, I might add, not totally absurd from the standpoint of internal consistency. (It is totally absurd, of course, from the standpoint of political viability.)
Accordingly, I disagree that the desire for more “progressive taxation” explains the President’s statements. Progressive taxation is indeed more familiar and less radical, and so if it fit, we might be compelled to conclude that’s what he meant. But it logically inconsistent with the President’s statements, not to mention incompatible with moral reasoning, which the President time and again has invoked with calls to “fairness.”
Let’s start with what the President’s premises would be under Mr. Likko’s suggested rubric: (1) You have a right in what you earn; and (2) if you earn a lot, you owe more to the government because you got a lot of value from the government. The first problem is that we are right back to the same moral reasoning as above—that is, the second premise has already forced us to concede that in fact we do not have a right to our earnings, and that, instead, to the extent they are derived from government infrastructure. If you “owe” those earnings to the government in this way, they were never equitably “yours” to begin with. Contrast this with taxes traditionally understood, which are not based on some economic investment the government has made, but instead on a wholly separate and independent obligation derived from the very nature of republican government. The obligations are fundamentally different in nature.
The second problem is that premise (2) contains an implied premise (3): that the government is a moral agent who is owed a moral duty of payment on its investment. This is because, as we saw above, the notion that taxes are owed because of government investment is based in the notion as government as an active investor, partner, joint venturer in the individual’s economic life, and thus, like the individual, a moral agent. This is problematic since it forces us into one of the first two scenarios that Jason presented in his post today (scenarios (a) or (b), in which the government has a rightful claim to everything we produce that we could not have produced without it). Only where the government is not a moral agent to which we owe our earnings, and only where the government is an agent of the people rather than an interested party, can we have a rightful claim to what we earn.
The third problem is that, even ignoring the first to problems and assuming we can still somehow have a right in our earnings, conceding that we have less right in earnings beyond a certain threshold is indistinguishable from conceding that we have no right at all in such earnings. Rights are binary: we have them or we don’t. Progressive taxation was ushered in along with social welfare spending with remarkably little effort made to explain its moral foundation. We should not be surprised to find that it has none. The issue has been avoided thus far, however, since, aside from a period of dizzyingly high progressive taxes, economic theory has forced lawmakers to refrain from approaching 100% marginal tax rates. Per Laffer, a 100% tax rate begets $0 revenues.
Despite its salvation by economic theory, progressive taxes are morally illogical unless you reject the premise that the individual has a right in his earnings.
Again, there is no way to parse the President’s moral claims in any intelligible way other than to conclude that he believes an individual has no right to his earnings to the extent of the government’s lien for the infrastructure it provides.