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While Objectivists believe that taxation is immoral, it is nonetheless an omnipresent issue in modern America that is here to stay for some time.

If Objectivists should strive for a culture of reason and should generally support steps that move the country and society that direction, how should Objectivists then approach tax reform? Should they advocate a progressive tax system? A flat tax system? Something else?

What is the standard by which one should judge taxation schemes?

asked Jan 02 '13 at 12:09

JK%20Gregg's gravatar image

JK Gregg ♦
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Right now a portion of Americans pay zero or negative federal taxes. If a "flat tax system" means making people who currently pay zero start paying more than zero, I don't think it is moral to sanction it.

With that said, I don't mean to advocate a progressive tax system. The only tax system that one should advocate is a voluntary tax system.

There is a great likelihood that taxes are here to stay for some time. But that doesn't mean Objectivists, or anyone else, should advocate or sanction them. The right thing to do is to always oppose any tax increases on anyone.

(Jan 03 '13 at 17:10) anthony anthony's gravatar image

The question answers itself: "Objectivists believe that taxation is immoral...." What should one do about immorality? First and foremost, don't do it -- and don't willingly help others to do it.

The question, however, seems (mostly implicitly) to regard Objectivist morality as impractical and ineffective in the face of current trends: taxation "is nonetheless an omnipresent issue in modern America that is here to stay for some time."

Ok, so if the moral course can't work in today's world, then the question becomes: what other standard should one use to "judge taxation schemes"? Note the slick way this type of question tries to induce Objectivists to give up their moral perspective.

In case anyone wonders why taxation is immoral, it is an initiation of physical force against those from whom the government forcibly loots the wealth which the government spends. Taxation inherently violates individual rights. One cannot preserve individual rights by participating in (or aiding and abetting) their destruction. The top political priority today is to preserve individual rights, to the best of one's ability and opportunity. The only way to "reform" taxation (i.e., government financing) is to make it voluntary (with "revenue shortfall" serving to limit government spending rather than provide impetus for imposing or raising taxes.

The proponents of tax increases are far from innocent in their "agenda." As Ayn Rand explains in The Voice of Reason Chapter 22 ("To Dream the Non-Commercial Dream"):

In my [article in Philosophy: Who Needs It] on "The Establishing of an Establishment," which discussed government grants to the social sciences, I wrote: "The origin of an aristocracy is the king's power to confer on a chosen individual the privilege of receiving an unearned income from the involuntary servitude of the inhabitants of a given district. Now, the same policy is operating in the United States...."

[The goal of modern intellectuals is] the establishment of a full-fledged aristocracy in perpetuity (with the succession determined not by birth, but by self-perpetuating professional guilds)—an aristocracy which, once established, would no longer be subject to public choice, approval, or control, an aristocracy independent of the government, except for the government's obligation to send out internal revenue agents to collect from the country at large the private tax imposed by the aristocrats.

... No man could face others and declare that he intends to force them to support him for no reason whatever, just because he wants it, for his own "selfish" sake. He needs to justify his intention, not merely in their eyes, but, above all, in his own. There is only one doctrine that can pass for a justification: altruism.

It is the morality of altruism that will need to be challenged, inevitably. Nothing less will suffice, especially nothing as short-range and narrowly concrete as squabbling over taxation rates without a proper moral context. As Ayn Rand pointed out in VOS, Chapter 15 ("Government Financing in a Free Society"):

Any program of voluntary government financing is the last, not the first, step on the road to a free society—the last, not the first, reform to advocate. It would work only when the basic principles and institutions of a free society have been established. It would not work today.

What kind of reform would the first to advocate? Ayn Rand suggested one strong possibility in The Ayn Rand Letter, Volume 1 No. 11:

...abolish all government subsidies in the field of the social sciences and, eventually, in all fields.

She elaborated further in her article, "The Establishing of an Establishment":

The fundamental evil of government grants is the fact that men are forced to pay for the support of ideas diametrically opposed to their own. This is a profound violation of an individual's integrity and conscience.... The Constitution forbids a governmental establishment of religion, properly regarding it as a violation of individual rights. Since a man's beliefs are protected from the intrusion of force, the same principle should protect his reasoned convictions and forbid governmental establishments in the field of thought.

In any case, the continuing rise in U.S. governmental debt seems certain to force some serious cutting of government spending in just a few short weeks, and government subsidies to the social sciences certainly ought to be high on the list for cutting.

Update: Abolishing all Income Taxes

A comment by Collin begins:

In Atlas Shrugged, when John Galt finally speaks to Dr. Stadler at the end of the novel, he says to cut all income taxes immediately.

I looked up this scene in the novel and found what Collin apparently was thinking of, but Galt was talking to Thompson, not to Stadler:

You want me to be the Economic Dictator?"
"Yes!"

"And you'll obey any order I give?"
"Implicitly!"

"Then start by abolishing all income taxes."
"Oh, no!" screamed Mr. Thompson, leaping to his feet. "We couldn't do that! That's … that's not the field of production. That's the field of distribution. How would we pay government employees?"

"Fire your government employees."
"Oh, no! That's politics! That's not economics! You can't interfere with politics! You can't have everything!"

It's sometime later that Galt meets with Stadler (at Galt's request). Immediately upon the mere sight of Galt, Stadler launches into a frantic, long-winded speech about how he basically "couldn't help it" and how Galt's captors inevitably will have to kill Galt. Galt replies simply: "You have said everything I wanted to say to you." Stadler runs out of the room. No mention of taxes in the Stadler scene. (Remember that Stalder had been a prominent physicist and head of the Physics Department at the Patrick Henry University, where Galt, Francisco and Ragnar had been his students. Thompson was the political "leader," aka "the Head of the State.") Note also that the scene with Thompson is a test of Thompson's true intentions, not a serious discussion of tax reform in a context of consensus on restoring individual rights and freedom.

answered Jan 03 '13 at 03:02

Ideas%20for%20Life's gravatar image

Ideas for Life ♦
467718

edited Jan 04 '13 at 01:34

So, Ideas, you have the same opinion of a progressive tax system as you do a flat tax system? If Rand herself said that instituting a voluntary government financing system was the last step to a free society, what steps before it can Objectivists hope to make? Yes, taxation is immoral, but, like Rand says, we can't just jump into voluntary financing today -- it won’t work. We need to transition to it. My question was, how should Objectivists approach this transition in the United States?

(Jan 03 '13 at 09:28) JK Gregg ♦ JK%20Gregg's gravatar image

Should we advocate lower taxes across the board? If presented the opportunity, should we accept a flat tax system? Should we accept creating more brackets in a progressive tax system? How can Objectivists make a meaningful contribution to the furtherance of a free society when it comes to the tax reform conversation? How do we navigate from here to there, so to speak?

(Jan 03 '13 at 09:31) JK Gregg ♦ JK%20Gregg's gravatar image

In Atlas Shrugged, when John Galt finally speaks to Dr. Stadler at the end of the novel, he says to cut all income taxes immediately. If Ayn Rand wrote that, I guess that would be a jumping-off point for any libertarian/objectivist politician today. The sad part is, no matter how much we talk about the Objectivist utopia on this site, none of us shall live to see the day a pure laissez faire society emerge. It's never gonna happen. You see, the human mind is like concrete on a paved road. Many things get into it, but once it dries, you can't change its shape. People choose not to change.

(Jan 03 '13 at 16:39) Collin1 Collin1's gravatar image

They can change. I can't force them to change--that is wrong. I can only inspire them to think the way I do. I have met some people who have read Atlas and still disagree with the novel's philosophy. (Regardless of their stance, I did have a real conversation with someone, and that feels great.) He misunderstood some points about Objectivism which I am ashamed I did not have the information to reinforce. But no matter how convincing I am to this person, I'm never going to change his mind. What do you think would happen if you locked Ayn in a room with Marx? You'll hear a loud bang.

(Jan 03 '13 at 16:51) Collin1 Collin1's gravatar image

You say that we can't just jump into voluntary financing today. This is true, but the reason it is true is that it's not what many people want to do.

You say we need to "transition to it", and you ask how Objectivists should approach this transition to it. But that isn't how it works. You don't have an Objectivist dictator who gradually changes the law from the current law to Objectivist law. Any shift, if it occurs, will likely come gradually, but it will come gradually because rational individuals will gradually come into power.

There is no excuse for compromise on violating rights.

(Jan 04 '13 at 07:26) anthony anthony's gravatar image
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Asked: Jan 02 '13 at 12:09

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Last updated: Jan 04 '13 at 08:36