It’s almost that time again America
Tax season, the time Americans dread, is just two months away. By now, American companies should be sending out their W2s, and the filing will begin. We have had some discussions on taxation on this blog, from a religious standpoint before. Now we turn to a philosophical and political one.
In my last post Is Taxation Theft and Does that Make it Evil?, I discussed the question of taxation. I believe in the most technical sense that taxation is a form of theft. Many argue that taxation is not theft, but if anything, it is extortion. However, most people regard extortion as a form of theft. In fact, most states include the crime of “theft by extortion” in their criminal codes. Generally, it differs from the crime of robbery in that the threat does not involve immediate harm. Still, theft by extortion can include an array of things. The intent is to take property that by right does not belong to you. The means generally include intimidation and any number of threats.
Using my home state of Pennsylvania as an example, our criminal code lists a number of things that would constitute a threat that would fit the definition of this crime. One of the possible factors included threatening to “accuse someone of a criminal offense.”
In other words, “Give me your money, or I’ll have you charged with a crime.”
How is that any different than what the government technically does?
We can then conclude that taxation is indeed “theft by extortion.”
This kind of violence and intimidation is certainly distasteful at best, but it is evil? Is it the act of a robber baron or of a Robin Hood stealing from the rich and giving to the poor? In exploring this question, I suggest we look at two historical figures.
A Necessary Evil
Winston Churchill, who served as prime minister of the United Kingdom during the Second World War, had a more complex viewpoint on taxes. On one side, he recognized their practical necessity for the funding of vital government functions at the time. On the other, he believed that working people should be allowed to keep the fruits of their labor.
He also spoke in the House of Commons as a fervent advocate of free trade, decrying tariffs when he said,
“Taxes are an evil—a necessary evil, but still an evil, and the fewer we have of them, the better.”
He held a somewhat alternative view on taxation, hoping to enact taxes on land, property, and inheritances rather than on regular income. He seemed to believe that if taxes were to exist, they should be taxed on the accumulation of wealth rather than wages.
Churchill’s plan didn’t pan out in the end, but even to this day, countries struggle with the question of taxation and how to carry it out fairly. If someone must be taxed, then who? How much should they pay, and what should they be expected to fund? At the very least, we should consider the philosophy that extortion by theft is an evil if a necessary one.
A Matter of Life or Death
Is there ever a reason to justify theft? Many would argue “no,” not in any situation. Others would disagree. Some of their names may come as a surprise to you, including one of our founders. I recently had the opportunity to hear a lecture on constitutional history and law by professor Thomas G. West. He is an author and a professor who teaches politics and political science at Hillsdale College.
In one of his lectures, he discussed a writing by Thomas Jefferson in which he presented a hypothetical moral dilemma. While not necessarily related to the issue of taxation, this philosophical thought does provide us with some insight
Let’s say there are two ships passing at sea late at night. Both are fully manned and on their way to the next port. One ship has a full crew but little to no supply. It’s absolutely certain that if they don’t find food soon, some of their crew will die. The other ship is fully stocked with more than enough supplies to make the trip with plenty leftover. With all other options exhausted, the poorly stocked ship decides to board the other vessel and overruns their crew. After finishing the violent assault, they then take off with the ship’s precious cargo and return to the sea.
Were they morally wrong to rob the other ship?
According to Thomas Jefferson, the answer is no because it was a matter of life and death.
Could one argue that mounting a national defense is a matter of life and death? What about providing emergency care for the poorest and most vulnerable members of society? What about the prevention of violent crime?
While we can certainly have a discussion on what government should and shouldn’t do, we should not discuss the morality of taxation on theory alone without also considering the facts. Under the current system, taxation, though no one likes it, would seem to be the “necessary evil” that Churchill described. However, does that mean we can’t have alternative systems?
Alternatives To Consider Ahead
Are there less extortionate and more efficient ways to fund a government?
In his article Taxation is Theft, Andrew Napolitano points out that in the early history of the United States, there were no taxes on income. The federal government, he says, was funded through the sale of public land and the collection of fees for government services.
Some experimented with tariffs, but they often led to trade wars and other disputes with our neighbors and harmed us economically. They also carry the added burden of discouraging foreign investment, which may actually create jobs in America.
While taxation may be here to stay for some time, there are still alternative systems that may work better for society. As it stands now, democrats and republicans have continued to play tug of war on the income tax. It’s getting to the point where we expect our already complex tax code to change every four to eight years. In all this back and forth, our system of taxes and how they affect the economy and how they affect everyday Americans hasn’t changed much.
A Less Unfair Tax
Some believe that if we want an improvement, we have to scrap the current code altogether. Advocates of the Fair Tax, for instance, have proposed a tax on consumption rather than income. They say the system accounts for the needs and struggles of the poor and is carefully tailored to spread out the tax burden fairly. Not only that, but the system works better economically. According to their research, a tax on consumption may be a more stable way to generate revenue. It also carries the added benefit of encouraging investment by eliminating the capital gains tax along with the personal and corporate income taxes. At the same time, it also encourages savings by taxing frivolous spending, more of which would likely be done by the rich.
The Fair Tax would also drastically simplify the tax code for millions of Americans by doing away with the sixteenth amendment, the IRS, and those pesky yearly tax returns. Plus, working Americans would get to keep more of their checks.
There’s no perfect system, but whether you believe taxes are the price we pay for society, theft, or a necessary evil, they won’t be going away anytime soon.
I suggest the question shouldn’t be on whether taxes are evil.