Thursday, December 15, 2011

Elizabeth Warren and the Infinitude of Taxation…

Originally written: October 20, 2011

Elizabeth Warren, Harvard law professor currently seeking the U. S. Senate seat held by Scott Brown (R-Ma.), recently made an argument for taxing the rich. She said in a stump speech: “There is nobody in this country that got rich on their own. Nobody. You build a factory out there—good for you. But I want to be clear. You moved your goods to market on roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of the police forces and fire forces that the rest of us paid for…” Thus, factory owners—CEOs, industry titans, the “rich”—should pay more.
It turns out this line of reasoning also makes a great case for a national consumption, or sales, tax: “There is nobody in this country that consumes on their own. Nobody. You purchase food, clothing, a car—good for you. But I want to be clear. You moved to the grocery, clothing stores, and auto dealerships on roads the rest of us paid for. You were served by workers the rest of us paid to educate. You were safe with the goods you purchased because of the police forces and fire forces that the rest of us paid for…” Thus, consumers should pay more.
If Warren seriously believes her first argument justifies progressive income taxation, how can she not believe her modified argument justifies a regressive national consumption tax?
But why stop there?
“There is nobody in this country that got poor on their own. Nobody. You failed to develop or mismanaged your human capital—good for you. But I want to be clear. Your food stamps and Medicaid payments were delivered on roads the rest of us paid for. The safety net that protects you is run and supervised by workers the rest of us paid to educate. You were safe in your government-subsidized housing because of the police forces and fire forces that the rest of us paid for…” Ms. Warren thus justifies heaping taxes on the poor.
The upcoming Senate race in Massachusetts bears watching. It portends to be more philosophical than most, offering Massachusetts voters two different visions of government. People can compare the kind of State envisioned by Scott Brown with the kind of State envisioned by Elizabeth Warren. I don’t know much about the kind of State Warren envisions. But it is clear it will be extremely well funded…

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