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When Can Taxation Be Justified?

  • Robert W. McGee

Abstract

But you might say, if government didn’t do all that it’s doing we wouldn’t have a just society. What’s just has been debated for centuries but let me offer my definition of social justice: I keep what I earn and you keep what you earn. Do you disagree? Well then tell me how much of what I earn belongs to you — and why? (Walter Williams)1

Keywords

Moral Obligation Moral Duty Eminent Domain Toll Booth Commutative Justice 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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NOTES

  1. 1.
    Walter Williams, All It Takes Is Guts: A Minority View, Washington, DC: Regnery Books, 1987, p. 62.Google Scholar
  2. 2.
    Rev. Martini. Crowe. 1944. The Moral Obligation of Paying Just Taxes, The Catholic University of America Studies in Sacred Theology No. 84. For a more recent comprehensive discussion of this topic that does not limit itself to the Catholic perspective, see Robert W. McGee, editor. 1998. The Ethics of Tax Evasion. Dumont, Nj: The Dumont Institute for Public Policy Research.Google Scholar
  3. 3.
    Some authors have disagreed with this position. Writers writing from the Jewish and Baha’i positions have argued that tax evasion is always unethical. For examples, see Meir Tamari, “Ethical Issues in Tax Evasion: A Jewish Perspective,” in Robert W. McGee, editor, The Ethics of Tax Evasion (Dumont Institute, 1998), 168–179; Gordon Conn, “The Ethics of Tax Evasion: A Jewish Perspective,” in Robert W. McGee, editor, The Ethics of Tax Evasion (Dumont Institute, 1998), 180-189; Wig DeMoville, “The Ethics of Tax Evasion: A Baha’i Perspective,” in Robert W. McGee, editor, The Ethics of Tax Evasion (Dumont Institute, 1998), 230-241. Other writers have failed to find justification for taxation in the relevant literature. See Walter Block, “The Justification for Taxation in the Economics Literature,” in Robert W. McGee, editor, The Ethics of Tax Evasion (Dumont Institute, 1998), 36-88.Google Scholar
  4. 4.
    Id., at 6-12.Google Scholar
  5. 5.
    E.R. Seligman, Essays in Taxation 406 (1931).Google Scholar
  6. 6.
    One might argue that one has the right to drive (or to walk, or to speak) without first obtaining a government license. But we will not go into that here.Google Scholar
  7. 7.
    One might argue that individuals have a right to operate a business with or without the government’s permission, and that a government that interferes with the conduct of personal affairs such as operating a business violates the owner’s rights, since reguiating private conduct is not a legitimate function of government. We will not go into that issue here, either.Google Scholar
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    Crowe, supra, at 11.Google Scholar
  9. 9.
    Id., at 14-15.Google Scholar
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    For more on this point, see James Bovard, The Fair Trade Fraud (1991), especially 35-64; Robert W. McGee, “The Trade Policy of a Free Society,” 19 Capital University Law Review 301–41 (1990); Robert W. McGee, A Trade Policy for Free Societies: The Case Against Protectionism. Westport, CT and London: Quorum Books, 1994; Robert W. McGee, The Case to Repeal the Antidumping Laws. Northwestern Journal of International Law & Business 13(3): 491-562 (1993).Google Scholar
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    For a comprehensive discussion of the Fifth Amendment takings clause and the concept of governmental takings, see Richard A. Epstein, Takings: Private Property and the Power of Eminent Domain (1985).Google Scholar
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    The cost of regulation is not insubstantial. Various estimates have placed the annual cost of regulation in the UA at hundreds of billions of dollars. Robert Genetski, The True Cost of Government, Wall Street Journal, February 19, 1992, at A14, col. 3; Thomas D. Hopkins, Cost of Regulation, A Rochester Institute of Technology Public Policy Working Paper, December, 1991; Ronald Utt, The Growing Regulatory Burden: At What Cost To America, The Institute for Policy Innovation, Policy Report No. 114, November, 1991; George F. Will, Purring Along the Potomac, Newsweek, November 30, 1992, at 96; William G. Laffer, III, George Bush’s Hidden Tax: The Explosion in Regulation, Backgrounder No. 90S, The Heritage Foundation, July 10, 1992. The Cato Institute [www.cato.org], the Heritage Foundation [www.heritage.org] and several other organizations have published a number of studies that estimate the cost of various regulations. The U.S. International Trade Commission publishes studies estimating how much its regulations cost the general public. One such study is The Economic Effects of Significant U.S. Import Restraints, Third Update 2002, USITC Pub. 3519 (June 2002), available at [www.usitc.gov]. Also see James Rolph Edwards, Regulation, the Constitution, and the Economy. Lanham, MD, New York and London: University Press of America, especially pp. 166–191 (1998). A good reference on the economic costs of regulation is Alfred E. Kahn, The Economics of Regulation: Principles and Institutions, 2 volumes, Cambridge, MA and London: MIT Press, 1989.Another good question to ask is whether it is sinful or unethical to evade a regulation. But we will save discussion of this point for another time.Google Scholar
  13. 13.
    It should not be overlooked that the landlord might also have to pay a tax on the $400 received, if the expenses incurred in operating the apartment are less than the revenue received.Google Scholar
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    Robert_E. Podolsky, Titania: The Practical Alternative to Government, Boca Raton, FL: The Titania Group, Inc., 2002, pp. 129–130.Google Scholar
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    Id., at 22-23.Google Scholar
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    Id., at 24-26.Google Scholar
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    Id., at 23.Google Scholar
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    Id. One wonders whether Crowe, who is a Catholic, would mind being taxed to support a Protestant spiritual or cultural event, or a showing at an art museum that includes artworks of crucifixes or photos of Christ that are soaked in urine, as was done at one art exhibition, with the support of government funds. And one might question whether it is just to impose taxes on Georgia residents to help pay for a monument to General Sherman, who helped to destroy their state during the American Civil War (more properly called the War for Southern Independence).Google Scholar
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    George_F. Will, California, Ugly: Recall war headed downhill, New York Post, September 4, 2003, p. 27.Google Scholar
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    Crowe, supra, at 24.Google Scholar
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    1411–1495.Google Scholar
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    Crowe, supra, at 29, is quoting from the 1494 Lyons edition of Angelus’ Pedagium section of Summa Angelica.Google Scholar
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    Of course there is another possibility — that lying is never a sin because there is no such thing as a sin. To hold this view, one must define sin as an offense against God and the person arguing the point must be an atheist. If sin can include unethical conduct against an individual, then sin can exist, since sin, in this case, is an example of immoral conduct.Google Scholar
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    Crowe, supra, at 35, quoting Berardi, praxis confessariorum II(1898).Google Scholar
  27. 27.
    Crowe, supra, at 37, discussing the view of Genicot-Salsmans, as espoused in Institutiones Theologiae Moralis 1(1927). The exact pages are not given, but it is likely that his views appear around page 572.Google Scholar
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    Crowe, supra at 38, referring to Croily’s Disputationes Theologicae de Justitia et Jure III (1877), at 1001 ff.Google Scholar
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    Crowe, supra, at 39, citing Frassinetti, Compendio della Teologia Morale I (1866), at 304.Google Scholar
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    Crowe, supra, at 53, is quoting Lugo’s citation of Molina’s De Justitia et Iure, III, disp. 674, n. 9, concl. 5 (1611), which is in Gabriel Vasquez, De Restitutione, cap. 6, para. 3, dub. 2, n. 43 (1631).Google Scholar
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    Crowe, supra, at 6-7 and elsewhere throughout the text. Castro defines a purely penal law as one that does not prescribe or forbid the doing of anything but merely imposes a penalty on someone who does something or omits to do something. A mixed penal law, for Castro, is one that prescribes or forbids doing something and prescribes a penalty for violators. A purely moral law prescribes or forbids something but does not provide a penalty. Castro, De Potestate Legis Poenalis I, c. IX, col. 1613 (1571), as cited in Crowe, supra, at 88.Google Scholar
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    Crowe, supra, at 17 and elsewhere in the text.Google Scholar
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    Springer v. U.S., 102 U.S. 586 (1881).Google Scholar
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    Pollock v. Farmers Loan v Trust Co., 157 U.S., 429; 158 U.S. 601.Google Scholar
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    Crowe, supra, points this out at 139.Google Scholar
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    Crowe, supra, at 97.Google Scholar
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    Concina, Theologia Christiana Dogmatico-moralis, VI, 309 (1774), as cited in Crowe, supra, at 55. Patuzzi (1700–1769) also takes this position in his Ethica Christiana sive Theologia Moralis 1, 90 (1770), who is cited by Crowe at 57.Google Scholar
  38. 38.
    For those unfamiliar with the distinction between mortal and venial sin, Catholic doctrine holds that someone who commits a mortal sin must spend eternity in hell, whereas someone who commits a venial sin must spend some time in a place called purgatory, where punishment is imposed for some temporary period, after which the sinner is transferred to heaven.Google Scholar
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    St. Antoninus, Summa Sacrae Theologiae II (1571), at about page 63, as quoted by Crowe, supra, at 42.Google Scholar
  40. 40.
    Here I am falling prey to the same line of philosophical reasoning I warned against. Whether a majority of theologians say this or mat really has nothing to do with the fact of the matter. Something is either a mortal sin or not, regardless of what a majority of theologians say. Molina (1536–1600) makes the following statement in this regard: “When a tax is imposed … those who do not pay, sin mortally provided the amount is sufficient for a mortal sin of theft, and they are bound in the forum of conscience to make restitution ….The common opinion of the doctors affirms this.” De lustitia et Iure, tr. II. disp. 674, n. 3 (1611), III, col. 555 ff., as quoted in Crowe, supra, at 43.Google Scholar
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    E. Voit, Theologia Moraiis I, 855 (1833), p. 372, as cited in Crowe, supra, at 57.Google Scholar
  42. 42.
    Murder, for example, is always a mortal sin, regardless of whether the person murdered is rich or poor, pious or sinful, young or old, Christian or not. But some sins can be mortal or venial, depending on the facts or circumstances, such as the amount of the theft and the nature of the victim.Google Scholar
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    Bonaema, De Morali Theologia, Tractatus de Restitutione, disp. II, q. K, n. 5 (1687), II, p. 449, as quoted in Crowe, supra, at 48.Google Scholar
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    Crows, supra, at 48.Google Scholar
  45. 45.
    This is an important question for people who believe that God wrote the Bible, in spite of overwhelming evidence to the contrary. For discussions by persons who dispute the divine authorship of the Bible, see William Henry Burr, Self-Contradictions of the Bible, New York: A.J. Davis & Company, 1860, reprinted by Prometheus Books, Buffalo, 1987; C. Dennis McKinsey, The Encyclopedia of Biblical Errancy, Amherst, NY: Prometheus Books, 1995; Joseph Wheless, Is It God’s Word: An Exposition of the Fables and Mythology of the Bible and the Fallacies of Theology, Montana: Kessinger Publishing Co., 1997; Ruth Hurmence Green, The Born Again Skeptic’s Guide to the Bible, Freedom from Religion Foundation, 1999; Michael Martin, The Case against Christianity, Philadelphia: Temple University Press, 1993; Joseph Wheless, Forgery in Christianity: A Documented Record of the Foundations of the Christian Religion, Montana: Kessinger Publishing Co., 1997; Robert G. Ingersoll, Some Mistakes of Moses, Buffalo: Prometheus Books, 1986; Charles Templeton, Farewell to God: My reasons for rejecting the Christian faith. Toronto: McClelland & Stewart, 1996; Joseph Lewis, The Bible Unmasked, New York: The Freethought Press Association, 1926; Dan Barker, Losing Faith in Faith: From Preacher to Atheist, Madison, WI: Freedom from Religion Foundation, 1992. Additional books of this genre can be found on the Prometheus Books website [www.prometheusbooks.com] and the Freedom From Religion Foundation website [www.infidels.org/org/ffrf/].. For an author who takes an opposite view, that God really did write the Bible, see John W. Haley, Alleged Discrepancies of the Bibie, Grand Rapids, MI: Baker Book House, 1977.Google Scholar
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    2 Kings 23:35.Google Scholar
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    Matthew 22:21.Google Scholar
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    Romans 13:7.Google Scholar
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    Crowe, supra, at 32, citing Beia’s Responsiones Casuum Conscientiae, cas. 13, 53ff. (1591).Google Scholar
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    Leo Jung, Business Ethics in Jewish Law 112 (1987). Italics in the original.Google Scholar
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    Lehmkuhl, Theologia Moralis I, n. 981 (1902), as cited in Crowe, supra, at 76.Google Scholar
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    Crowe, supra, at 37, citing the views of Genicot-Salsmans as expressed in Institutiones Theologiae Moralis (1927).Google Scholar
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    H. Davis, Moral and Pastoral Theology 339 (1938), as quoted by Crowe, supra, at 40.Google Scholar
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    The Social Security system is a bad investment for the vast majority of people. Individuals are forced to pay thousands of dollars into the system over their working lives, yet have no right to claim any benefits before age 62 or later. If they die before they collect, their heirs get nothing. And even if they do collect a monthly check, the amount they receive is generally less than what they would receive if they had made equal contributions to a private pension fund. For more on this point, see Peter J. Ferrara, Social Security: The Inherent Contradiction (1980); Social Security: Prospects for Real Reform (Peter J. Ferrara ed. 1985). Volume 3, No. 2 (Fall, 1983) of The Cato Journal is also devoted to this topic. The Cato Institute is conducting a major study of Social Security. Many of these papers may be found at the Cato Institute website, http://www.cato.org.Google Scholar
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    In many cases, individuals do not have a choice. They do not have the option of either paying or evading the Social Security tax because it is taken from their paychecks before they receive them. But self-employed individuals can evade the Social Security (selfemployment) tax by not declaring all of their self-employment income.Google Scholar
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    This point is discussed in most public finance texts, and in the public finance chapters of general economics texts.Google Scholar
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    Of course, people who pay property taxes to educate other people’s children get no return for their payments, and may even be adversely affected, since these recently educated students — who are computer literate — will soon compete with them for jobs that may require computer literacy.Google Scholar
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    These percentages are used only for illustrative purposes. The actual percentages will differ depending on a number of factors. For example, senators and representatives in some states are more skillful in obtaining federal money for their constituents than are others. And some taxpayers derive very little benefit for the taxes they pay, whereas others get a great deal back in the form of services. And those who pay little or no taxes can receive much more in services at all levels of government than what they pay, since they pay so little.Google Scholar
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    I would like to thank Marshall Fritz for introducing me to this example.Google Scholar
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    A number of commentators over the years have speculated as to why the best individuals do not ran for political office or gravitate to positions of authority in government. For one of the better expositions on this point, see Why the Worst Get on Top, which is chapter 10 of Friedrich A. Hayek, The Road To Serfdom 134–52 (1944). 31Google Scholar
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    Another point might also be made here. The Public Choice School of Economics, founded by James Buchanan and Gordon Tullock, has been pointing out for several decades that government officials are motivated by the same things that motivate the rest of us — self-interest. They act in their own interest, not the public interest.Google Scholar
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    Kant’s categorica! imperative permeates his works. For some discussions and examples of it, see Immanuel Kant, The Metaphysics of Morals (1797); Immanuel Kant, Ethical Philosophy (1983); W.L. Reese, Dictionary of Philosophy and Religion 278-79 (1980); Ernst Cassirer, Kant’s Life and Thought 245–54 (1981); 4 The Encyclopedia of Philosophy 317 (1967).Google Scholar
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    It could still support some activities through voluntary revenue raising means, such as lotteries and user fees.Google Scholar
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    It may be difficult, as a practical matter, to avoid paying a toll if there is someone at the booth who is ready to take either your money or your license plate number if you do not pay. But some toll booths allow users to pay by throwing in coins or tokens, which provides a greater opportunity for beating the fare. However, the more sophisticated toll booths now have cameras that take photographs of the license plates of cars that pass through the toll booth without paying the toll.Google Scholar
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    There are a few exceptions. A few roads are privately owned. A number of studies take the position that at least some roads should be privatized — turned over to private owners — because privately owned roads are better maintained at a much lower cost. Thus, government ownership of roads results in the squandering of resources, relatively speaking. For more on this point, see Steve Steckler and Lavinia Payson, Infrastructure, in Privatization For New York: Competing For A Better Future, A Report of the New York State Senate Advisory Commission on Privatization (1992), at 186–214; Randall Fitzgerald, When Government Goes Private: Successful Alternatives to Public Services 47-8, 163-74 (1988); Robert W. Poole, Jr., Cutting Back City Hall 148-49Google Scholar
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    The Yellowstone Primer (John A. Baden and Donald Leal eds. 1990); Randall Fitzgerald, When Government Goes Private: Successful Alternatives to Public Services 68-71, 193-207(1988); Robert W. Poole, Jr., Cutting Back City Hall 99-107 (1980).Google Scholar

Copyright information

© Springer Science+Business Media New York 2004

Authors and Affiliations

  • Robert W. McGee
    • 1
  1. 1.Andreas School of BusinessBarry UniversityMiami ShoresUSA

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