17 April 2012

Neither taxation nor property is theft

I do not believe, as many do, that the wealth of the world is unambiguously divided into the product of individuals' efforts.

The economy of the world is a great machine in which we all participate. The iPhone in my pocket is a product of the effort of countless thousands, even millions, of people. There are the engineers who designed it, the factory workers who built it, the managers who organized the effort, the miners who produced the materials, the truckers and salespeople who moved all that around until it wound up in my hands. Pennies from the price I paid for it were distributed to all those folks, in a vast accounting scheme, but there is no essential, natural order to that accounting scheme; in principle, it could have been organized differently.

Note also that the most important people who birthed my iPad did not get paid. Countless people, most of them long dead, built the tools used to build the tools to build the tools to make it, from Alan Turing back through the first person to smelt iron and before. Without them, the efforts of the people who did get paid would have been almost worthless. Without them, we would all be impoverished paleolithic savages whatever our wit and effort. None of us have any claim on that wealth by virtue of our own efforts. It belongs to all of us, or none of us, depending on how you look at it.

I paid money for that iPhone, and that money passed from me to Apple, and from there to countless others, trickling back to many of the contributors who helped make that phone, as well as to many others who had no hand in my phone at all. The system of accounting by which that wealth was distributed as little slices of private property is a vast, sophisticated fiction. I don't say “fiction” to dismiss it. Private property is a powerful, valuable fiction, stunningly effective in enabling us to create wealth. In comparison with other accounting fictions human beings have tried — feudalism and Sovietism and so on — it has profound advantages that I hesitate to sacrifice. But I reject the idea that individual productivity understood this way reflects some essential truth prior to our social arrangements. We invented private property. We divided the world into things owned by different people. We could choose to organize things differently if we decided it served us better.

Government creates, sustains, and enforces this fiction. That's not to say that government owns everything and then distributes it; government only asserts that ownership is structured in a certain way, with most wealth owned by entities other than government. In service of making the mechanism of government possible we empower government to levy taxes, which we can see as yet another useful fiction.

The wealth of the world belongs to humanity. Government animates the system by which we organize that wealth. I believe in liberal democracy: that our collective will should define government (democracy), but that there are some things that government should not be empowered to do even if we will it (liberal).

I originally wrote this in response to a libertarian who told me that in advocating taxation, I implicitly favored a totalitarian government which “owned everything”. That libertarian was wrong.


sharon knight said...

There often appears to be a goodly dose of black and white thinking in the Libertarian mindset, I find.

henry said...

I don't know if i would characterize those ideas as fiction unless one is prepared to characterize all social ideas that have been proccessed into some sort of manifestation as fictions as well.
I can see where you're working from though.

Jonathan Korman said...

I am entirely prepared to do that, Henry.

Henry said...

Cool. I can view things in terms of that as well.
what I'm wondering is what are you getting at. Are we discussing the useful fiction of "commonweath"?

Jonathan Korman said...

Just so, Henry.

My point is to combat a weird assumption that underlies many arguments of taxation-is-theft libertarians and pseudolibertarians. Those folks often speak from a framework in which private property is natural but government is an invented imposition: “the wealth that I made is mine, and then we invent government which comes and steals what is mine".

But government and private properties are both social inventions. Indeed, they are interconnected social inventions; one cannot have the one without the other. As inventions, their value comes only from the degree that they serve our purposes.