Monday, February 25, 2008

Taxation and Democracy 101 (on Lucky Duckies and Other Never-Ending Debates)

The back-and-forth debate between Megan McArdle (plus here) and Henry Farrell over taxation--specifically, over whether or not the fact that even people who proclaim their support for government programs and other high tax projects do not generally contribute to the government very much (if anything) beyond what is required by tax laws should be taken as evidence that what people really want is merely "higher taxes on other people"--has spilled over into Laura McKenna's blog, and sucked me in. Actually, Megan and Henry's original argument--which is really more a methodological one than anything, pertaining to how one discerns and attributes normative weight to various collective actions and presumably revealed preferences--isn't what has drawn me in (interesting as it is) so much as what seems to me to be the constant, vague disconnect between the libertarian-minded and those of us who have internalized the basics of Democracy 101. To wit: at some point in the evolution of the social contract towards democracy, the conceptual distance between, say, "slavery" or "extortion" or other conditions or methods which a given government may exercise directly or have the power to force you into on the one hand, and "taxation" on the other, has grown so great as to render (to most citizens in liberal democracies) the bare, conceptual relationship between the two so tenuous as to make conversations conducted in the light of that understanding mutually incomprehensible. Or in other words...

Laura says that she's willing to pay more in taxes for better schools. Seems pretty straightforward--she values her childrens' schools enough that she's willing to pay more in taxes to see them improve. But Megan says: you don't actually mean that; you're either saying something so banal it's pointless (as in "Of course I happily accept America's system of taxation; I'll take even more of it, if the alternative is living as a desperate, non-tax paying refugee in some lawless state somewhere"), or you're saying you're willing the state to coerce even more money about of really rich people (as in "This public good which I love is, in my mind, so important to all of us that we need to make certain it is suitably funded by the wealthy, and I'll even pay a little more in taxes to make sure the state does just that"). As Laura comments, that kind of makes sense--"in some sort of a crazy-assed world." (The zero-sum anarchist utopia, perhaps.) Whereas in actual liberal democracies, which most of us acquiesce to because we desire collective goods that are beyond our individual capabilities and purse strings, and within which we've more or less come to the conclusion that, so long as basic rights are acknowledged and defended, the blunt tools of taxation are to be accepted as the most equitable and efficient way to get most collective things done, it becomes a component of our membership as citizens to speak and act so as to build coalitions and compromises--in other words, to participate in the democratic machinery of the state--and thereby adjust taxes accordingly. In short: we're part of the same democratic collective that's doing it, to varying degrees in accordance with our general beliefs, to ourselves and everyone. It's not a competition over who can get the government to point its gun at whose head, no matter what P.J. O'Rourke may say. (Megan tries to complicate this point by suggesting that, if you're not making an extra-tax individual contribution to the government in line with your willingness to pay higher taxes just because you figure your personal addition won't make a difference, then that must mean you're mixed-up, and "morally justified in cheating on your taxes" to boot. Uh, right. So respect for the rule of law and/or your contentment with all the other things the government does with our money--like, pay cops--just goes out the window?)

This all reminds me of nothing so much as a blog-argument I had with Jacob T. Levy nearly five years ago. It was an outgrowth of the "lucky duckies" debate, if anyone remembers that. Jacob took the argument the Wall Street Journal made about how progressive taxation, by allowing poor and some lower-income people to avoid paying any at all, is undermining the "tax rage" needed to seriously shrink government, and used it in a TNR piece to explore the larger issue of commonality and equality in democracies. It was a great essay (which unfortunately I can no longer find online), but in its undercurrents, the basic (mis)understandings are the same ones lurking around Megan and her defenders: on the one hand, we have people who take the paying of taxes to be some sort of marauding enormity coming from outside ourselves, one which we wish to avoid or just have to reluctantly deal with as we get on with the business of living (which, if such business includes wanting better schools, consists of...I don't know, buying my oldest daughter's home room teacher some nice shoes?); and other hand, people who understand that, very broadly, paying taxes (according to whatever schemes we come up with) is part of us all being in this together. Is that a sappy communitarian justification of old-fashioned, gun-to-the-head exploitation? No, I don't think it is. Let me just clip one bit from my old post (with a couple of additions):

[Jacob writes:] "The 18-year-old conscript killed in a war he opposed in order to discourage politicians from starting wars, the child kept in a failing school in order to persuade her parents to support a better public school system, and the professional coerced into a low- or negative-return Social Security system in order to keep the entire system politically viable...the working-class parent whose taxes are kept high in order to expand support for tax cuts. As individuals, each would be better off if allowed to opt out. But, in each case, that individual's welfare is subordinated to the collective goal. 'We're all in the same boat,' runs the political message of shared citizenship. But the policy imperative is to keep us all there, chained to our oars if necessary."

But Jacob is wrong in thinking that all of these individuals are similarly being "used." He is treating huge differences in kind--differences that can be well-elaborated philosophically and sociologically--as mere variations on a single, collectivist impulse. His use of "exploitation" as a way to communicate the commonality between all these collective enterprises masks the legitimate communitarian difference between enlisting individuals in program where both means and ends can be expressed in terms of wholes, and enlisting individuals in schemes which, by their nature, cannot be (and should not be) wholly equalized....[T]o address his specific examples: so long as one's community is anything besides an Amish-style agrarian one, there will be economic differences and inequities which will divide the community, and thus require certain levels of "picking" in order to achieve certain collective goals (equal opportunity, economic justice, etc.). A strategy to equalize burdens which, from the standpoint of such goals, should not be strictly equalized, simply for the sake of engendering rage against the system as a whole, can certainly be called "exploitive," [whereas, a democratic process that reaches some sort of rough consensus about the appropriateness of differing types and levels of individual obligation needed to achieve something truly collective wouldn't be]....That we should always be aware of how politics can go wrong in communities is certainly true. I doubt, however, that it follows that every form of boundary-drawing and identity-building necessarily implicates us in a sense that we are violating someone's essential interests. There is the possibility that (some) wholes are actually greater than (some) parts, after all.

5 comments:

Rob said...

I get concerned, though I still take the money, over the Federal Supplemental Child Tax Credit, which in my case rebates back to me more than I have withheld in income taxes. (I'm in the high five figures for gross income.)

That is to say, nothing is withheld, and the Feds deposit a couple grand in my account each tax season. Ostensibly this is to offset the FICA withholdings.

Of course, I take the money. Largely, it pays off incidental big-ticket items, like dental sealants for the kids. Or an oral retainer. Replacement eyeglasses for me.

In other words, health care. That's an interesting anecdotal wrinkle on a national debate, isn't it?

Regarding schools, I know I'm firmly in the taxed-public-common-schools camp. The benefit I draw now, and drew in spades as a growing child and teen, I pay later as an empty nester in a very valuable home on valuable property, "Lord willin' and the creek don't rise."

Pardon faults and all, but *that seems fair to me*. Pay extra voluntarily? I don't think so, because I can target my extra far more effectively through PTO's and such, for schools, or food banks and humanitarian aid funds, for other causes. There are verifiably more hands out for that extra than I can fill, even with a negative income tax!

Raise my taxes through the legislative process or according to law-based formula, byzantine or not. (The Washington State laws regarding computing a county's property tax are positively byzantine.)

Jacob T. Levy said...

I also wrote there:

"To sometimes be yoked together under a shared institution in order to preserve its viability is the universal price of political life. To try to redraw the class boundaries, to keep people linked to one sense of shared belonging rather than another, or to argue that this or that shared institution really isn't necessary or desirable--this is the basic stuff of politics. It should always be done with a bit of bad conscience, and without denying the element of exploitation. But no one should pretend to be surprised that it's being done at all."

Now, obviously I still differ from Russell; I want to to keep one eye on the person who in my view is being exploited, whereas Russell wants that person just to celebrate his or her new Rousseauian freedom, and wants to be able to describe the person as just morally mistaken if he or she thinks anything bad has happened at all. (Sorry, but I think this 'democracy 101' stuff is a little unnecessarily dismissive, so I'll suggest that Russell hasn't picked on 'negative liberty 101.') But I wasn't saying that the cases didn't differ. Nor did I say that all of the interests implicated were "essential" ones. I said some cases would be justified and others not-- albeit with some justificatory burden.

Again, I think the heart of our disagreement isn't the tax case but is conscription. And I see no problem in saying:
1) some wars need to be fought;
2) maybe even, in certain kinds of emergencies, conscription is ultimately needed; but also
3) the conscript is exploited by the society he's risking life and limb for that won't even pay him a competitive wage for the task, and that this is a moral cost; the conscript has not been gifted by his society with some new morally elevated privilege of contributing to a whole that is greater than the sum of its parts. He should continue to get to count at least as a part; his loss of liberty and potential loss of life is a cost, not a benefit.

Russell Arben Fox said...

Rob,

I get concerned, though I still take the money, over the Federal Supplemental Child Tax Credit, which in my case rebates back to me more than I have withheld in income taxes....Largely, it pays off incidental big-ticket items, like dental sealants for the kids. Or an oral retainer. Replacement eyeglasses for me. In other words, health care. That's an interesting anecdotal wrinkle on a national debate, isn't it?

Never thought about it that way, but you're right: the sort of people who rake it in through the Child Tax Credit are the sort of people who generally have large and uncovered health and dental expenses. That's what we have to look forward to! Right now, we're using our tax refund to try to finally pay off last year's summer vacation and the attendant damage to the car.

Jacob,

I want to to keep one eye on the person who in my view is being exploited, whereas Russell wants that person just to celebrate his or her new Rousseauian freedom, and wants to be able to describe the person as just morally mistaken if he or she thinks anything bad has happened at all. (Sorry, but I think this 'democracy 101' stuff is a little unnecessarily dismissive, so I'll suggest that Russell hasn't picked on 'negative liberty 101.')

Fair enough, Jacob; as I said (I think?) in my original post, you make a strong point about the importance of keeping one's eyes on the many various forms of exploitation present in our society, and how even supposedly innocuous collective goods like public schools can potentially fall into that trap. So you keep your Isaiah Berlin and Judith Shklar handy, while I'm batting around my Benjamin Barber and Charles Taylor.

I still maintain that there's some important overlap between the question of taxes for schools and the matter of other forms of exploitation we explored back them, but perhaps I was a little aggressive in my drawing of the parallels. Do you still have a copy of your TNR piece? You should repost it; I'd love to be able to find it and cite it online.

Jacob T. Levy said...

sadly, it's disappeared into the Great TNR Online Archive Loss of 2007. We keep hearing that everything missing will get back online eventually, but it's taking a while. I must have my originals of all of them in an old e-mail account and on an old hard drive, but I keep not looking for them out pending the TNR fix.

Anonymous said...

"Actually, Megan and Henry's original argument--which is really more a methodological one than anything, pertaining to how one discerns and attributes normative weight to various collective actions and presumably ..."

Actually, no. It was Megan not understanding the term 'collective action problem', even after her right-wing commenters schooled her on it.

-Barry