Why Progressive Taxation Makes Sense (and Anti-Estate Tax Arguments are Unpatriotic)
George Lakoff and Bruce Budner of The Rockridge Institute elaborate here on some of the hidden truths and necessary social positives of a progressive taxation system…
Progressive taxation - taxing the wealthy at higher rates than the poor - is a moral issue. Like many moral issues, it sparks heated debate. The debate is borne of conflicting worldviews, values and understandings of values.
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America’s government has at least two fundamental functions: protection and empowerment. Protection includes the police, firefighters, emergency services, public health, the military and so on. Empowerment includes the infrastructure needed for business and everyday life: roads, communications systems, water supplies, public education, the banking system for loans and economic stability, the SEC for the stock market, the courts for enforcing contracts, air traffic control, support for basic science, our national parks and public buildings, and more. We are usually aware of protection. But the empowerment infrastructure, provided by taxes, is usually taken for granted, hidden or ignored. Yet it is absolutely crucial, a fundamental truth about America and why America provides opportunity.
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As Warren Buffet famously observed, he likely couldn’t have achieved his financial success had he been born in Bangladesh instead of the United States, because Bangladesh had no banking system and no stock market.
Ordinary people just drive on the highways; corporations send fleets of trucks. Ordinary people may get a bank loan for their mortgage; corporations borrow money to buy whole companies. Ordinary people rarely use the courts; most of the courts are used for corporate law and contract disputes. Corporations and their investors - those who have accumulated enough money beyond basic needs so they can invest - make much more use, compound use, of the empowering infrastructure provided by everybody’s tax money.
The wealthy have made greater use of the common good - they have been empowered by it in creating their wealth - and thus they have a greater moral obligation to sustain it. They are merely paying their debt to society in arrears and investing in future empowerment.
This is the fundamental truth that motivates progressive taxation.
It is a truth that undercuts conservative arguments about taxation. Taxes provide and maintain the protecting and empowering infrastructure that makes our income possible.
Our tax forms hide this truth. They do not indicate the extent to which taxes have created and sustained the common wealth so you could earn what you have. They make it look like the empowering infrastructure was just put there by magic and that the government is taking money out of your pocket. The most likely truth is that, through the common wealth, America put more money in your pocket than it took out - by far.
