Taxation and Wealth Redistribution as Lowbrow Morality

Peter is a wealthy man and has $1,000 in his wallet. He plans to use it for a variety of things—some groceries, taking his wife out to dinner, and buying some new golf clubs he’s been admiring.

Enter Paul. Paul thinks that Peter’s money could be put to better use, like helping low-income families get healthcare and putting children into preschool, among other things. As a result of his beliefs, Paul threatens Peter. Peter can “voluntarily donate” to these programs, but if he refuses, or doesn’t offer “enough” of his income, Paul will take Peter’s money anyway and hold him in captivity.

Would you consider this to be fair? Probably not. Just because Paul wants Peter to spend his money on certain honorable causes doesn’t mean that Paul has the right to take Peter’s money. Paul is stealing from Peter. He is violating Peter’s rights by stealing his property.

Most people would take issue with the above scenario. However, many people advocate this kind of activity everyday. Instead of just Paul and Peter, however, it’s Peter, Paul, and the government. Paul thinks Peter should spend his money in some particular way and Peter disagrees. Since Paul is not powerful enough to compel Peter to fork over his money for certain causes, he lobbies the government and votes to raise Peter’s tax rate.

“Peter is rich,” Paul says. “He’s in the top 20 percent of income earners! He should do his part to help his fellow man.”

This is frequent rhetoric for those who advocate higher taxes for wealthier people in society. But just because such arguments are used frequently doesn’t make them correct or give them moral traction.

If we agree that the first scenario is theft, then why does the introduction of a middleman, the government, make a difference? Theft is theft. Coercion is coercion. If you wouldn’t steal Peter’s wallet and give its contents to some cause you deem worthy, why is it OK for someone you voted for to steal it on your behalf?

I posed this very question to a friend after she told me she had voted for Obama (in 2008) because “her brother needed healthcare and Obama would create universal healthcare.” I asked her why other people should be forced to pay for her brother’s medical expenses when they are paying for their own and working to support themselves. Why is it their responsibility?

I’m still waiting for an answer to this question that doesn’t invoke emotion as its only authority.

There are two general forms of direct taxation. First, there are taxes based on a person’s ability to pay. Second, there are taxes levied in proportion to the benefits received by an individual from her fellow tax-payers. The vast majority of taxes in the U.S. (and in many countries) are of the first variety. Income taxes, for example, represent nearly 50 percent of tax revenue. These individuals aren’t likely paying for services from which they benefit, but their money is being used all the same.

I fail to see how these types of taxes represent any notion of justice or occupy the  moral high ground. If we accept private property rights, then advocating for increased taxation because “someone should give up more of their money” or they aren’t paying the “fair share” (a totally vacuous concept) is advocating theft.

Taking from someone who has earned a great deal of money to give it to the poor, doesn’t make a robber a moral person. It makes him a thief! Calling on the government to rob Peter on Paul’s behalf doesn’t magically make the situation morally good.

As the late economist Murray Rothbard said,

Just as no one is morally required to answer a robber truthfully when he asks if there are any valuables in one’s house, so no one can be morally required to answer truthfully similar questions asked by the State.

Run, Peter!

Abigail R. Hall is a Research Fellow at the Independent Institute and an Assistant Professor of Economics at the University of Tampa.
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