Although most people find racism and sexism intolerable in practice, many of these same people don’t consciously reject racism’s and sexism’s theoretical foundations on principle, which tragically leads them to unwittingly abet the same kind of irrational, collectivist, dehumanizing persecution they believe they have forsworn.
The belief that it is possible to infer the moral worth of a person solely based on skin color or annual income or gender is as irrational as the behavior that it produces is reprehensible. Although our society has made tremendous progress on racism and sexism, income bracket bigotry is the law of the land:
In 2007, the top-earning 25 percent of taxpayers (AGI over $66,532) earned 68.7 percent of the nation’s income, but they paid more than four out of every five dollars collected by the federal income tax (86.6 percent). The top 1 percent of taxpayers (Adjusted Gross Income [AGI] over $410,096) earned approximately 22.8 percent of the nation’s income (as defined by AGI), yet paid 40.4 percent of all federal income taxes. That means the top 1 percent of tax returns paid more in federal individual income taxes than the bottom 95 percent of tax returns.
Income bracket bigotry is the unreasonable assertion that a person increases his moral liability with each additional dollar he earns, and therefore, the more a person earns, the less a person should be permitted to keep. Many people accept the notion that higher tax rates are justified by higher earnings without thinking about it. So widely accepted and deeply seated is this prejudice that it does not strike most people as controversial. People who are otherwise compassionate and reasonable regard annual income as an acceptable basis for legal discrimination.
If you think that a law that targets a minority with higher tax rates is wrong unless that minority has an annual income that you consider too high, then you’re an income bracket bigot. If you’re thinking, “But rich people can afford higher taxes,” well, would you say of a black man working on a plantation, “He’s young and strong, quite capable of working as a slave,” or would you say of a woman, “Her capacity to give birth is more important than her freedom to choose to do so?” You have capacities, such as natural talents and learned skills. Would you object to my citing some or all of them as reasons to compel you to act against your will or to pay me a percentage of your income?
The fourteenth amendment to the U.S. Constitution explicitly forbids states from making or enforcing laws that deny any person “equal protection of the laws.” We are all citizens, but the presumption of innocence does not apply to all of us equally; some of us have to pay more of some of the dollars we earn merely to avoid fines and stay out of jail.
Ignorance powers every form of bigotry. Income bracket bigots contend that there is only so much wealth to go around and assert that the high annual incomes of some deprive other people of their fair share. Many people believe that this obsolete, “wealth is a zero-sum game” Marxist demagoguery amounts to sound reasoning. It doesn’t.
Yes, if I drink your milkshake without your consent, then I have increased my wealth by depriving you of yours. But that scenario is more precisely analogous to the effect of an income bracket bigot’s progressive income tax system (ie, robbing Peter to pay Paul) than it is to the way most people earn their annual incomes. Most people trade their labor to people able and willing to compensate them for it. When people trade voluntarily, the party receiving money and the party receiving a good or service both become wealthier. Income bracket bigots don’t understand this. If you accept my bid for your milkshake, at the end of the trade we both end up wealthier. And if you sell one milkshake for $10 or one hundred million milkshakes for $3 each, you are no more or less entitled to the first or last dollar exchanged. There is no rational basis for saying that laws should treat the first dollar differently than the three hundred millionth dollar.
Income bracket bigotry is an article of faith among American Leftists, but even they sense the need to justify themselves, which they do by referring to social justice, the ideal of an egalitarian society achieved by social engineers through mechanisms like a graduated income tax. But this vestigial, magical thinking does not correspond to reality. No societies were ever poorer than those that empowered bureaucrats to redistribute wealth coercively, nor were any crueler, more oppressive, or deadlier.
On the other hand, the greatest wealth accrues to the greatest number of people as a result of voluntary trading, not as a result of coercive redistribution. The incentives that prevail in markets result in more goods and more services becoming more affordable to the greatest possible number of people.
The historical record and empirical evidence in support of the theory of free market capitalism are as irrefutable as the data which support the theory of evolution and the theory of relativity. Why do so many people ignore and resist and demonize a theory which accurately describes how creativity, productivity, and prosperity arise in societies that promote voluntary, peaceful, purposeful, individual human action?
Americans are currently bearing the brunt of their government’s gargantuan involuntary wealth transfers to failed firms in the automotive and financial industries, as well as ongoing massive subsidies to agricultural, health insurance, pharmaceutical, and energy companies. Corporate welfare and laws that grant some companies advantages over others are disgraceful and should all be illegal. Many people mistakenly interpret alliances of government and business as “capitalism,” and insofar as that is the definition they are operating on, they are right to protest it. However, most people still earn money without the benefit of government subsidies or protectionist laws. Most people I know believe people ought to pay higher tax rates on higher incomes. Why?
Because they are consumed by a bigotry against wealth creators, blinded by prejudice.
Bigots are as much strangers to their own humanity as they are to the humanity of others. The determinism inherent in bigotry— trait X leads directly to moral position Y— renders people unthinking, uncaring automatons.
If a person’s annual income does not result from coercion or fraud, that is, if his annual income is derived from peaceful, voluntary exchanges with honest parties based on mutual consent, then what is the nature of the process that leads to the conclusion that such income should be subject to legal discrimination, legal predation, legal extortion?
When a society already morally disapproves of a race or a gender or a sexual preference or a scientific inquiry or an entrepreneur’s success, but is more inclined to wield power over others than commit genocide, its bigotry rises to the surface at the margins. The bigoted rationale that leads to allowing gays in the military as long as they pretend to be straight, the lynching of outspoken people who belong to an ethnic minority, the censorship of scientific knowledge that contradicts religious dogma, and the stoning to death of women who show their faces in public also results in higher tax rates on higher incomes.
There is a great scene in Inherit the Wind that comes to mind. Courtesy of YouTube, here it is:
“There is no way to administer a wicked law impartially.”
Although the play is ostensibly about the responses of a heroic few to a law banning the teaching of evolution, it is also addresses the threat to human civilization of faith-based attitudes, ideals, and laws. By definition, prejudice is a leap of faith, an unreasonable conclusion, an empirically false proposition elevated to authoritative revelation. Societies that tolerate faith-based laws are bound to use people’s peaceful behavior as a basis for brutalizing or plundering or killing them. Though income bracket bigotry most directly penalizes success, depriving people of means to grow their businesses and invest in others, and often leading them to depart for other states (including other countries) whose governments will respect their equality before the law, Truth, Justice and Progress are its most tragic casualties. What kinds of reforms are likely to prevail in a society that tolerates income bracket bigotry?
The U.S. is in the middle of an economic crisis built on decades of faith-based public policy, a situation only exacerbated by the American Left’s income bracket bigotry. President Obama’s response to the status quo? More status quo. Higher taxes on top annual incomes. (For the record, Republicans had six years to undo income bracket bigotry and did nothing.)
What minority wouldn’t do everything within its power to shield itself from its government’s increasingly hostile response to its law-abiding behavior? Why do tax revenues increase when tax rates are lower? What is the fate of a society that discriminates against its most successful entrepreneurs?
Imagine if Obama heeded Dr. King’s wisdom and abolished the ruinous laws prejudiced against wealth creation and economic growth. Wouldn’t that be the morally right thing to do? Wouldn’t that be truly progressive?
{ 2 comments… read them below or add one }
I’m very far from a Marxist (as I’m sure you know since my blog is on your blogroll), and I would like to see a more proportional system of taxation. That said, I think your argument here is flawed. In a progressive tax system, each individual faces the same rate structure, and in that sense everyone is treated equally before the law. Each of us pays the same rate of tax on our first $X of income, the same rate on our next $Y of income, and so forth.
Think of it like climbing a mountain. The foothills have a very low grade, but then it gets steeper and steeper as you get closer to the peak. Now, would we say this mountain somehow discriminates against high climbers? No — all climbers face the very same situation. The climbers who face steeper gradients do so simply because they have reached a higher point on the same mountain.
Thanks for sharing your thoughts, Greg. I’ll try to clarify my point.
I’m not disputing the fact that “each individual faces the same rate structure, and in that sense everyone is treated equally before the law.” Fine… in that sense. But you seem to think that fact renders a progressive tax code impervious to the accusation I’m leveling against it. I obviously disagree. Wealth produced by voluntary human action should be subject to the same treatment by the law. That’s the equality I’m talking about. As I see it, the progressive tax code itself expresses prejudice against wealth creation and against high income earners.
It is no consolation to me that the people in the foothills, were they to ascend to the heights other people have reached, which most of them have neither the ability nor the drive to do, would then face the same obstacles upon arriving there. There are already “steeper grades” associated with the activities required to achieve successful wealth creation without introducing man-made legal interference and obstacles. I’m asking, “what is our moral basis for taking more capital out of the hands of those particularly good at using it?” Because they were particularly good at using it? Because high income earners don’t deserve to keep as much of their profits as low income earners do? That’s not rational. It’s not humane. I contend that it’s motivated by prejudice.
I like real mountains. The progressive tax code has mountainous characteristics, but it is a man-made monstrosity, first and foremost. It would not exist were it not for laws that reflect a diabolical mix of attitudes and ideas and values that morally justify singling out wealth creation for punishment. It exists because of income bracket bigotry, and its existence helps perpetuate the rationale for such prejudice.
A discouragingly enormous number of people believe that peaceful, successful wealth creation is a valid basis for moral disapproval and legal discrimination. This is the prejudice that was not addressed head-on when the Soviet Union collapsed and the Berlin Wall fell. Its survival is among the main reasons why socialist rhetoric still appeals to people. People know totalitarian communist dictatorships are awful, but they also are irrationally certain that there is such a thing as too much profit, even when it proceeds solely from voluntary exchanges.
When politicians like President Obama run on the promise of funding utopia entirely by increasing taxes only on people with the highest incomes, they do so because the political gains of exploiting income bracket bigotry are clear to them. They know that most people will lead lives within a range of income brackets below the income bracket they are targeting for higher fees. And they do not realize that many of the tax increases on high income earners will be borne by them in higher prices and fees in the market. Obama certainly knows that vast numbers of voters appreciate his articulation of a moral ideal that promises more real world benefits for them to be paid for by those whose moral worth is at the very least suspect precisely and only because they earn a lot of money.