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Ending the Discussion of "Fair Share"
Dean Zarras
I write about big government's corrosive effects on civil society.
This article is more than 10 years old.
Let's talk about "fair share." President Obama certainly wants to. He's "all in" on the notion that "the rich" don't pay their "fair share" of taxes in this country. Indeed, he's wagering his re-election on the bet that a majority of voters will agree with him. When the tyranny of the majority succeeds, Obama will win, too.
As parents, one of our most important tasks is to know when to say "no" to our children. We all recognize a "brat" when we see one -- a child who's never been told "no", and whines and complains until he or she gets his or her way. "Shame on his parents!", or perhaps that's not politically correct to say anymore. But bratty children grow up to be bratty voters, too.
Unfortunately our political system often rewards the political equivalent of the irresponsible parent. Using Other People's Money, irresponsible politicians promise the world, and the bratty voters like it. Once elected, these politicians do their best to deliver the goods. It's alright, they say, because of their interpretation of the General Welfare and Commerce clauses of the Constitution. Others beg to differ...
Sadly, under such a system, no amount of revenue to the government is ever enough, because human wants are themselves unlimited. Therefore, those with a lot of assets, with "a lot" being defined by the politics of envy, become natural targets for the boundless benevolence of these irresponsible people - voters and politicians alike.
Image by Getty Images via @daylife
At least one prominent media figure is finally on to the correct way to put a lid on this ruinous line of "fair share" reasoning. Most recently, it was Stuart Varney.
On his September 20th show, Mr. Varney put a simple question to a Democratic strategist, Mary Anne Marsh, in the context of discussing Obama's plan to raise taxes on the wealthy. To paraphrase:
"What is the maximum percentage of income that someone should pay in taxes?"
It's an arresting question, for several reasons.
For starters, it was literally arresting to Ms. Marsh. Upon repeated prodding from Varney she steadfastly refused to answer the question, which just tells you how toxic the subject is to believers in ever bigger government. This question is Kryptonite to their cause, pure and simple, and it became easy to see why.
The question hits directly at Man's relationship to The State. With many top taxpayers paying over half of their income in various forms of taxes (yes, combining federal, state, local, property, Social Security, Medicare and so on -- this is the only true measurement of taxation), just who are they laboring for, and why? Clearly at this point they are laboring as much for the State as they are for themselves.
But are there any incentive effects towards a person's motivation to work when they have to give up so much of the fruits of their labor? As Varney asked later in the discussion, "Why not just raise the federal income tax rate to 60%"? Marsh wouldn't answer that either. And of course we're not even yet considering the efficacy of the spending that this tax revenue attempts to fuel.
I'd suggest that the "why" referenced above is the tyranny of the majority. Simply put, it is the legalization of theft. It is a majority of voters knowing full well that it's wrong to break into their neighbor's house and steal their stuff, even if they just intended to give it all away to the poor, but getting government to do it for them instead. Frederic Bastiat saw it coming in 1850:
The law perverted! And the police powers of the state perverted along with it! The law, I say, not only turned from its proper purpose but made to follow an entirely contrary purpose! The law become the weapon of every kind of greed! Instead of checking crime, the law itself guilty of the evils it is supposed to punish!
If this is true, it is a serious fact, and moral duty requires me to call the attention of my fellow-citizens to it.
- Frederic Bastiat, "The Law"
The question is further arresting when one tries to consider what the correct total percentage should be. During his 2008 Presidential campaign, Governor Mike Huckabee made the profound observation that if we all tithed, sent in 10%, to our various religious organizations, we wouldn't need government to try to extract forty or more percent to do the things that our religious organizations could do instead. Clearly, on average, society has a problem in voluntarily complying even with a law from a much Higher Power. The voluntary 10% results in non-compliance, but a forced 60% under some circumstances might just be acceptable -- go figure.
Consider also that the Framers of the Constitution, with their views on the role of government, didn't even include an income tax. The 16th Amendment came 125 years later. What would they say about a system that's capable of taking over half of a citizen's wages? Much is made about the Framers not abolishing slavery from the start, but we finally got it right. How many years will it take to abolish slavery to The State?
But lastly, the maximum percentage of income question is arresting because by capping the "fair share" of someone's income that can be confiscated by The State, we arrest the growth of government, provided that we also cap the spending at the total amount of money raised by such taxation.
What's the correct percentage? I'll take a stab at it: Considering the tithe was to go to the church, keeping government on an equal footing (and a lot of people would argue that's too generous of a philosophy) would say ten percent should work for for them as well. Indeed, considering the vision laid out in the Constitution, ten percent should be generous, ignoring that the Framers would likely consider it treasonous instead.
By ruling out The State's ability to enslave its citizens to the tyranny of the majority, we ensure that proper prioritization of public spending is at least considered. Either that, or government is forced to give ample preference to policies that tend to grow society's total income, and therefore, grow its take. For sure, a 10% cap on income taxes wouldn't come close to funding the government's current obligations, but I'll save that for another column. And if 10% seems shockingly low, all that says is we've moved really, really far away from the funding requirements of the Framers' intent for the Constitution.
Which brings us full circle to Obama's arguments. When people talk about needing to solve our debt and deficit problems through the inclusion of tax increases, it implicitly says that our present level of spending is correct, or nearly so. It says that politicians can continue to act like irresponsible parents, never saying "no", and raising brats in the process.
With the rise of the Tea Party movement, it appears that the voters are increasingly maturing from their brattish ways. They're shutting government-as-usual down, and not everyone's happy about it.
The children are schooling the parents.
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