Monday, August 22, 2011

Fair Share: the real meaning may be found in the words of a certain German philosopher

When they say the rich should pay their "fair share" of taxes, what do they really mean by this deliberately vague phrase? Two assumptions underlie it. The first is that making money is inherently evil, or, in other words, that capitalism is a scourge and egalitarianism, regardless of personal accomplishment, is an ideal that will usher in a paradise on Earth. In this sense, "fair share" does not mean the rich should pay their fair share of taxes, whatever fair means in that context, but that by being rich the wealthy have accumulated more than their fair share of wealth and property, as if there is some sort of objective scale for determining such things, and society has the obligation to relieve them of this excess and unnecessary accumulation.

The second assumption in the term "fair share" concerns the purpose of income tax. Many of us believe income tax is a revenue generating device enabling the government to fund itself so it can undertake various public projects, such as road building, police and fire departments, national defense, etc. But experience has shown that raising taxes actually tends to lower government revenue because the wealthy respond to higher taxes by moving away or sheltering their income from tax or refusing to start businesses, leading to more unemployment and fewer people paying taxes. It seems obvious that getting the wealthy to pay their fair share in taxes actually gives government less money. So why do progressives insist on it.

Progressives see income tax as a means of redistributing wealth, not principally as a revenue raising device, taking from those who have more than their fair share, and, through government, giving to those who don't, thereby leveling the playing field. Or as Karl Marx wrote, "from each according to his ability, to each according to his need." This is the real meaning of "fair share." Any American who wants to prevent the country from becoming Zimbabwe should challenge not just the assumptions of this phrase, but its very legitimacy.

When they say the rich should pay their "fair share" of taxes, what are they really saying withthis vague phrase. For one thing, "fair share" is incredibly vague and it has a basic underlying assumption, that making money is inherently evil, that capitalism is a scourge and that egalitarianism regardless of accomplishment will usher in paradise on Earth. What they really mean is not that the rich should pay their fair share of taxes, whatever fair means anyway, but that by being rich they have accumulated more than their fair share of wealth and property. So another underlying assumption of the phrase "fair share" is that

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