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Tuesday, August 02, 2005
Blogging Update
I haven't been posting a lot lately. My blogging adress apears likely to change soon, as I may be joining a group blog. I will have more details when this is finalized.
Wednesday, July 20, 2005
My response
I have responded to kevin carson's comment in the comments section of the Deontology post.
Thursday, July 14, 2005
My Flag Amendment Protest
So, how can a true freedom-loving American patriot protest the desecration of a symbol of freedom by means of limiting freedom in its name? I have seen several people declare that, although they have never burned the American flag, they will if this amendment passes. I absolutely refuse to do this. I do not endanger my life to protest freedom-restricting adult seat-belt laws, and I love America and the American flag too much too much to burn it just because some assholes tell me I can't. Hell, one of the many things I hate about this amendment is that I know it will just cause FAR more American flag burnings than it has any chance of preventing, and that disgusts me.
So here's my plan: If this evil amendment passes, I will, as publicly as possible, burn the Confederate battle flag. And I will repeat this on every July 4th until the amendment is annulled or I die. The Confederate battle flag is, by its very existence, the antithesis of the American flag, and yet this amendment would never have any chance of passing if the eleven states of the Confederacy had succeeded in seceding. It is the fascist impulses of those stupid enough to revere both the American flag and the flag of violent revolt against America to maintain slavery that is pushing this amendment. The Confederate battle flag ACTUALLY represents everything evil about the United States that some mistakenly think the American flag stands for. The only way bring America back to being the beacon of freedom in the world is to rid it of its Confederate impulse, and I will do that symbolically by burning their flag, which will thank god still be legal even if this amendment passes. Those bullies I grew up with may think they are succeeding in turning the American flag into the Confederate flag, but I plan to demonstrate to them that those who truly love what America stands for hate what the Confederacy stood for.
I told my wife this plan, and she said, "Why don't we start now?"
Tuesday, July 05, 2005
Deontology
A deontological moral theory states that certain actions are right or wrong in themselves, or that the justification for whether an act is right or wrong depends on something other than the consequences of the act. If a deontologist believes it is immoral to tell a lie, they may justify that belief by claiming that lying violates a principle of respect for the person to whom the lie is told, or simply that God commanded them not to lie. What a deontologist will not do is justify the immorality of lying by pointing to all of the bad things that happen when people lie to each other. Lying is always wrong, even if it sometimes makes life easier for everyone. (Note here that I am using lying merely as an example, and an anti-lying provision need not be in any particular deontologist's moral code.)
Deontological libertarians justify their political position as the result of a commitment to a belief in the non-interference principle, or a prohibition against the initiation of force. This principle states that it is immoral to interfere with the actions of other people through the initiation of force. Coercion is wrong. You may comment on the actions of others and try to persuade them to stop what they are doing, but if you threaten the use of force against others in order to get them to comply with your requests, this is coercive and wrong. Deontological libertarians thus believe in a form of "natural rights", that humans, by their nature, have the right to do as they wish without the interference of others.
How is this ethical belief a political belief? Well, all laws are by definition coercive. If you disobey them and get caught, people with guns will do bad things to you, such as forcing you to live in a prison with other people who disobeyed laws. If laws were not coercive, they would be called "suggestions".
A deontological libertarian socialist believes that it is coercive to allow some people to control the property used by others to produce things. Productive work is what most people spend most of their waking hours doing, and to let someone else to own the property they work with is to allow their lives to be controlled by others.
A deontological right libertarian believes that an individual's right to self-ownership mandates individual ownership in external property in order to effectuate the freedom promised by self-ownership. Property rights in external objects can arise by creation or appropriation, and these rights are absolute and eternal.
A deontological left libertarian agrees with the right libertarians that individual property rights are necessary to effectuate freedom and that these rights arise from creation. However, left libertarians believe that there are natural limits to individual property rights. There are many different left libertarian theories and each theory has a different combination of limitations on property rights. Some typical deontological limitations on property rights in left libertarian theories include:
- Property rights do not arise from appropriation.
- Property rights that arise from appropriation must be accompanied by a responsibility to compensate the dispossessed.
- Ideas cannot be owned.
- Property rights arising from creation terminate at the death of the creator.
Problems with deontology:
There are two huge problems that all deontological theories, including non-libertarian ones, share. The first is, do deontological rules actually exist? That is, does a statement such as, "Stealing is wrong," actually describe a fact about the universe in same manner as the statements "This flower is yellow," or "Force equals mass times acceleration"? This problem is best epitomized by Jeremy Benthem's famous remark that talk about natural rights was "nonsense on stilts."
The other problem is that deontology usually leads either to bizarre counter-intuitive results, or justifications and exceptions are made based consequences, making the system one of rule consequentalism rather than actual deontology. For example, suppose we decide that it is deontologically true that lying is wrong. What, than, should a person in 1939 Germany hiding Jews in their house do if Nazi officers ask him if he knows where any Jews are hiding? Sure, we can make an exception for lying to save a life, but then aren't we really modifying right and wrong based on consequences?
Each specific form of libertarianism has its own problems when justified by deontology. Libertarian socialism, in preventing excess wealth from being invested as capital, has to try to explain how it is consistent with freedom to prevent people from mutually agreeing to exchange their claims on certain property. Why are they interfering with what Robert Nozick rightly referred to as "capitalist acts between consenting adults"?
Deontological right-libertarians have to explain how the positive right to exclude others from "your" property is consistent with formal negative liberty. How does that piece of paper you have called a "title deed" give you the right to prevent me from swimming in this lake that existed when both of our ancestors still lived in trees? How am I at all interfering with George Lucas's freedom by downloading "Revenge of the Sith" from the internet?
Many deontological left-libertarians think they have solved the problems mentioned in the above paragraph by requiring payment of the market value of rent to the community in exchange for exclusive rights to use certain resources, but they have not. They have merely instituted a system of forced sales. This is certainly more fair than forced taking, but it is no less involuntary. What if I did not want to sell my right to walk across the mountain? Is it alright for you to walk into my house and take my stereo if you leave behind its fair market value in cash?
The most logically consistent form of deontological libertarianism is that of the "individualist anarchists" who stated that ownership of property was established by "occupancy and use". These are the rules that govern how children play with toys at pre-school. You can play with any toy that no one else is playing with. You can not take a toy away from anyone who is playing with it. When you are done playing with a toy, you let someone else have a turn. You can exchange your toy with another child who would rather play with yours. Children who wish to play together can share their toys in a way that they all agree to. There are really no logical flaws in the individualist anarchist system, but it leads to many counter-intuitive results and practical difficulties. What do you do with your house if you want to be away for a while? Benjamin Tucker, perhaps the most prominent individualist anarchist, is reported to have answered that the last user and occupier would not only lose his land, but his personal property as well. How free would you feel in a society where you could never go on an extended vacation if you wanted to keep your house? (Assuming it was even possible to travel. I am not sure how to compensate anyone for building roads in such a system.)
Wednesday, June 22, 2005
How bad is U.S. Inequality?
During her lifetime, Ayn Rand approved writings from only two other people to be included in the "cannon" of works that made up her egoist philosophy, Objectivism. One of them was Alan Greenspan, current Federal Reserve Chairman. Greenspan opposes helping the poor on principle. His inegalitarian credentials are second to no one else alive.
So, when Alan Greenspan tells Congress that the income gap between the rich and the rest of the U.S. population has become so wide, and is growing so fast, that it threatens the stability of democratic capitalism, perhaps it is time they admitted there is a problem, no?
Of course, his proposed solution is exactly what I described in my article for The Free Liberal as the conservative solution: Better education. As I stated in my article, the problem with that is that better education just provides more increased value from the labor-capital exchange that capital can take for itself. (Which is why conservatives, who represent the capitalists, like it.) Want proof of my claim? Consider the Flynn effect on IQs. Political scientist James Flynn did a survey of IQ scores all around the world over the last hundred years and discovered that they are increasing steadily everywhere for every type of intelligence. Rates vary, but some scores are increasing by as much as one standard deviation per generation. For one type of test, he concluded that someone who scored among the best 10% a hundred years ago, would nowadays be categorized among the 5% weakest.
Now, apparently there are reasons to be suspicious that education is the cause of this increase, and I certainly agree that our education system fails many children - particualrly the poor - miserably. But despite this, the population is apparently getting smarter anyway. But the average person in the lowest 5% of IQ today is probably still much poorer than the average person in the top 10% of IQ a century ago, despite their equal intelligences. And when given modern equipment and production methods, the modern "moron" is probably MUCH more productive than his equally intelligent "bright" counterpart a century ago. So if he is equally intelligent and more productive, why is he poorer? Who is getting all of that excess wealth that he is producing?
Friday, June 17, 2005
Kevin Carson at Mutualist Blog: Free Market Anti-Capitalism has written a post incorporating and in part responding to my article for Free Liberal. Instead of a basic income, he suggests reform of money and credit monopolies, an issue that I have yet to wrap my head around. The colusion between government and banks may be another way in wich the government enforces rules designed to futher enrich the already wealthy. So far I am hip to the need to socialize land rents, inherentences and the market value of corporate advantages. I need to study more to determine if socializing - or is that "freeing"? - money and credit should be on my list of left-libertarian priorities.
At any rate, as I explained in his comments, I do not see a basic income as being at odds with his proposed solution, and it addresses some of the theorical points he raised.
Thursday, June 16, 2005
Goldwater Liberals?
Part 3 of Elizabeth Anderson's series on free societies is up. It's a freedom-based defense of private property. The important issue is that she points out that private property is a coersive measure that interfers with formal freedom, but it enhances the formal freedom of those who use it. She analogizes to traffic regulations, which violate formal, non-interference freedom, but which make real freedom on the road - the ability to drive to places you want to go - possible. I discussed this analogy in an earlier post.
Also at Left2Right, Don Herzog reviews a pro-liberty statement of principles from the past that eriely predicts the beliefs of 21st century progressive liberals. "It's the 1964 Republican Party platform. Right, the one Barry Goldwater ran on."
Tuesday, June 14, 2005
Basic Income has No Effects on Marriage
Blimpish wrote a long post opposing a Basic Income from a conservative point of view. Overall, I was suprised how good it was: Very few of his factual assertions about a basic income were misleading, he rather argued that what is known about the effects of a basic income are likely to be bad according to the type of society conservatives want. For example, he pointed out that results of negative income tax experiments show that they encourage single mothers and mothers with working husbands to stay home with their children rather than enter the workforce. Apparently, this is something conservatives do not want. Growing up in the seventies listening to debates among adults about feminism, I got the opposite impression of what conservatives wanted women to do, but apparently I was mistaken.
At any rate, Blimpish make one factually incorrect assertion about the effects of a basic income that I want to correct. But let me emphasize, this is not his fault. He takes his information about the effects of a basic income from the final U.S. government report on the findings of the Seattle-Denver Income Maintenance Experiment (SIME/DIME), and links to the report. Blimpish states:
SIME/DIME seemed to have a major negative impact on 'marital' (the couples didn't have to be married) stability. Amongst both black and white (less so Hispanic) families in the sample, the rate of 'marital' dissolution increased by over 40%, with the rate only reducing where there were high (and therefore labour-reducing) basic payments.
chris dillow responded to several of Blimpish's points. As to the marriage instability issue, dillow wrote:
4. CBI would increase marital break-ups.
The SIME/DIME, cited by Blimpish, seems to have done this.
And this is one of its many advantages. In giving women a guaranteed income, it increases their ability to leave abusive relationships.
As it happens, I was on a panel for a roundtable discussion on the economics of a basic income at The Fourth Congress of the U.S. Basic Income Guarantee Network, where one of the presenters was Robinson Hollister, a professor of economics at Swathmore College, who discussed the findings of various negative income tax experiments. His presentation was essentially the same as his remarks chronicled here from a similar, earlier roundtable. As to marriage stability, he states:
The most commonly mentioned of the non-labor supply results was an erroneous finding by some sociologists from the initial analysis of the Seattle-Denver Income Maintenance Experiments that the marriage-dissolution rate for black families in the experimental groups was 57% greater than the control group and 53% greater for white families. When these results came out in congressional hearings, Senator Moynihan, who had been a backer of Nixon's Family Assistance Plan, and who had written a very controversial report about instability in the black family, recanted his support for the guaranteed income. Those particular findings greatly contributed to killing the Carter administration's effort for a guaranteed income scheme. In the 1980s, Glen Cain carefully reanalyzed the data from Seattle-Denver experiment. The results were quite technically quite complicated, but there was basically no family dissolution effect. Some of the results were suspect from the beginning, because the effect seemed to occur in the sector of people with the lowest guarantee rate, the lowest incentive to strike out on their own; the recipients who had the least to gain from breaking up showed the largest amount of marital breakup. Cain's study appeared in the American Journal of Sociology in 1990, with a rebuttal by the authors of the original findings, but subsequent studies (and those from the other NIT experiments) also found no effects on marital stability.
He also states:
The Minnesota experiment found positive effects for marital stability and reduced domestic abuse. In the Canadian experiment, we found an increase in marital stability in New Brunswick and a decrease in marital stability in British Columbia.
In my comments, I got a laugh from the crowd by stating that I was disappointed to learn that the NIT experiments showed no decrease in marital stability, because one of the reasons I supported a basic income is because I thought it would make it easier for poor women to leave abusive relationships. But regardless of what dillow and I desire and Blimpish fears, it apparently did not happen. There is no effect on mariage stability from an NIT.
As to the negative effect on work by husbands shown by the NIT experiments, the way Blimpish descibes the form of the disincentive is very different from the way Hollister describes them, but the overall effect of the disincentive is about 10%, as he states. One response I would give is to point out that most basic income proposals suggest giving the basic income to everyone, regardless of income, while the the SIME/DIME was an NIT experiment with a 50% take-back rate. It should be unnecessary to explain to conservatives how a 50% income tax rate can create work disincentives.
The last two substantive paragraphs of Blimpish's posts:
My point is this: as much as the public do, rightly, care about social justice (however you define that), equalising economic outcomes for all isn't what they're driving at. There are big social problems in this country, and in many cases a lack of income and assets is one part of it - but the lack often isn't the problem, but a symptom of it. Giving the Left CBI opens the door to egalitarian solutions that we oppose not only because we object to the idea of an unconditional right to share the wealth, but because it's a cop-out to actually dealing with those social problems.
Rather than passing a family a bit of cash in the hope that they'll feel included in our 'community', while the child's mum can't stay off heroin and their dad flits between their house and those of his other children, and prison because he keeps getting into fights down the pub... maybe we should try to do something to help these people sort their lives out? Not to sound like a Leftie, but wouldn't it be nice to try to get to the 'root causes' here, rather than hoping a few quid might fix it?
Some further findings of the NIT experiments, as reported by Hollister:
The rural experiment in North Carolina and Iowa collected data on educational attainment. In North Carolina there were significant positive influences in grades 2-8 in attendance rates, teacher rating, and directly on test scores. The literature on education shows that it is nearly impossible to raise test scores through direct intervention. Yet, BIG had large desirable effects for the test scores of children in the worst-off families in the rural South. The New Jersey experiment didn't collect data on test scores, but there was a very significant effect on school continuation; that is, BIG was an effective anti-drop out program. And again, if you look at programs that are trying to reduce dropouts directly, it's a pretty dismal scene. In Gary, there were positive test score effects for males in grades 4-6. In Seattle-Denver, there was a positive effect on adults going on in continuing education.
Some of the experiments collected data on low birth weight, nutrition, and other quality-of-life effects. Low birth weight is associated with very serious deficits later on in life, and programs that try to reduce the incidents of low birth weight have been largely ineffective, but the Gary experiment found that the NIT reduced the low birth rate in the most at-risk categories. The rural experiment showed significant effects in various categories of nutritional adequacy. Homeownership showed significant effects in New Jersey, in the rural experiment, and in the first year of the Gary Experiment.
Score more points for giving people, even the poor, freedom instead of trying to micro-manage their lives.
Wednesday, June 08, 2005
Hey, Wow, I've been book tagged by Redneck Feminist. I will do my best, but some of these answers are difficult or embarrassing.
How many books do you own? Not a friggin' clue. Not even sure how to count or estimate them. I have been an avid but inconsistent reader all of my life, often reading one book after another in quick succession, and often going long periods without reading any books. Also, I have ADD, Inattentive Type, which means that I can not remember most books I have bought or where I put them, and any place I have control over is a total mess. I currently have books scattered all over my office, in my mother-in-law's house, in my house, at my parent's house, and in storage in a couple of different locations.
Last book you bought? The World's Worst: A Guide To The Most Disgusting Hideous; Inept, And Dangerous People, Places, And Things On Earth by Mark Frauenfelder of boingboing. A lot of fun.
Last book you read? Taking this to mean the last book I finished, that would be Bone, by Jeff Smith, the one volume edition. A truly amazing work. Originally published serially over the course of twelve years, I could not believe how tight the end work is. It really is one epic story, every chapter advances and is important to the main story, and there are less than a half dozen extraneous characters. The setting is a fantasy world with a rich history and mythology, the story is action packed and compelling, and the characters are well rounded and funny, and three of the most important characters - for non-relationship reasons - are women. And I especially enjoyed how the Bone cousins looked appropriately incongruent with how the rest of the characters and background were drawn, as if they had wandered in out of another comic book. Oh, did I mention Bone is a comic book?
Five books that are important to you?
1. Atlas Shrugged by Ayn Rand. Embarrassing to admit, especially for publicly funded attorney who represents welfare recipients for a living, but reading this book really was a life-changing experience. In my defense, I was a socially awkward white male in high school when I discovered it. Still, the passionate defense of relying on reason and living one's life for oneself and being proud of your accomplishments is something that was impossible to resist and has never left me. As a philosopher, I have ironically come to think of her as many defend Karl Marx: The positive philosophy she advocates is flawed beyond redemption, but as a critic of her enemies, she is as devastating as a nuclear bomb.
2. Progress & Poverty by Henry George. God, how I wish when I was an evangelical libertarian in college, unsuccessfully trying to convince those around me of the soundness of (right) libertarian philosophy, someone would have said, "Actually, you're half right. Here, read this," and handed me this book. Now, I have gone far beyond the narrow "geolibertarian" reading that many have (wrongly, in my opinion) ascribed to George. But the approach of recognizing that there can be a shared community commons that is logically consistent with and even supportive of individual liberty is how I attack all political questions now.
3. The Hitchhiker's Guide to the Galaxy and The Restaurant at the End of the Universe by Douglas Adams. I included them both in one numeral because they really are one book, separated by the author's inability to meet publishing deadlines. A hilarious introduction to thinking philosophically about life.
4. Informal Logic: A Handbook for Critical Argument by Douglas Walton. The best guide to critical thinking I have ever seen. Walton dispenses with the "fallacies" approach to critical thinking and discusses the importance and limits of abductive reasoning along with the "traditional" inductive and deductive models of reasoning. It turns out that most "fallacies" are actually arguments that are not inductively convincing or deductively valid, but have various degrees of abductive plausibility.
5. The Player's Handbook by Gary Gygax. I have not played Dungeons & Dragons for over a decade, but the ways in which my time spent in this hobby have affected me are too numerous to count. Yes, I am a geek.
Who do I tag? Unfortunately, other than Redneck Feminist, I do not know who regularly reads my blog who has their own blog. So, if you are reading this, have your own blog, have not been book tagged in the past, and there are less than five response in comments to this post, please consider yourself tagged and leave a comment letting me know where you are on the web.
Tuesday, June 07, 2005
Will a BIG Lead to Freedom?
Thinking further about chris dillow's post that I blogged below, I realize how badly I wimped out responding to Robert Capozzi's skepticism about a BIG. Capozzi agreed that a BIG would be superior to the hodgepodge of welfare programs and labor regulations that currently exist. However, he doubted that anyone in government would propose a "Install a sufficitarian BIG and remove all welfare programs and labor regulations" bill. Instead, what will happen is that a BIG will just be added onto the existing welfare and regulatory state, and there is no reason to hope from experience that the government will remove programs and regulations that are no longer needed. I conceded the point. I suggested that a BIG would de facto reduce or eliminate the welfare state by reducing the number of people who qualify for welfare programs, but I offered no empirical hope for the regulatory state being eliminated after the institution of a BIG.
dillow's post lays out the real answer to Capozzi's question: A BIG may not be sufficient to automatically cause the state to wither, but it is likely necessary. While it is empirically true that government programs rarely or never go away just because they are no longer needed, it is also empirically true that libertarians have totally failed to sell their economic agenda to the public, despite the takeover of this democratic republic by a party that professes to be fanatically committed to economic freedom. This is because whenever a libertarian is asked, "What about all of the people who would starve under a libertarian regime and the multiple more who would be exploited by their employers?", libertarians usually try to deny that this would happen or claim private charity could take of it. And the questioner then shakes their head and walks away convinced that the libertarian is either a deluded utopian or simply does not care if poor people starve. Introducing a basic income into the agenda up front on both humanitarian and power-inducing grounds addresses these concerns convincingly. And if a BIG were introduced, fears of what could happen if we allowed economic freedom would diminish. It would allow us to begin making the case for economic liberty.
So, the short answer to Capozzi is: No, I cannot guarantee that freedom will arrive with a BIG. But I can guarantee that freedom will not arrive without a BIG.
What Justifies Libertarianism?
The three basic approaches to justifying libertarianism are the same as the three basic approaches to justifying any ethical or political system. They are:
1. Deontology
2. Utilitariansim
3. The Social Contract
I will briefly describe each of these approaches and how they have been used to justify libertarianism in future posts, and then link to each of those posts through the list above.
Liberals for Freedom
Elizabeth Anderson at Left2Right has recently written a bunch of posts attacking the (right-) libertarian moral case against taxation. I have not read enough of these to respond properly, but I have read her latest post, and it is truly fascinating. Having blasted away the case for a right-libertarian conception of freedom, her new task is build up a new case and plan for a free society. Most of her post discusses Hayek's ideas about the need for distributed power and decision making, the informational functions of markets, the advantages of a procedural conception of justice, and, most surprisingly, his admiration for and agreements with Rawl's Theory of Justice. It is compelling and she promises that it is just a beginning and further posts are forthcoming. She sets herself up to make the case that procedural constraints on both the floor and ceiling of wealth are not only consistent with but necessary for a conception of justice that emphasizes individual freedom without concern for individual outcomes. I am of course a HUGE fan of income floors through such mechanisms as a NIT or a BIG, but I am extremely skeptical of ceilings on either incomes or wealth. However, as impressed as I am about this post, I will be interested to see if she can overcome my skepticism.
Also, Part 2 is here.
Friday, June 03, 2005
Libertarian Views of Government
There are three different "levels" of possible government compatible with libertarianism. Libertarians will usually be discovered arguing for one of these as "the" appropriate libertarian view, but all are compatible with self-ownership.
1. Anarchy. Zero. Government is evil. If less is better, none is best. Government commands are not voluntary suggestions; all government is the use of coercion, and all coercion is morally wrong or ineffective (zero or negative sum games as opposed to positive sum games in voluntary cooperation).
2. Minarchy. Government is a necessary evil. A monopoly on force is needed to protect individuals from violations of their rights by other individuals. In minarchy, the purpose of government is to prevent government.
3. A Rights-Respecting Government. Government can be good. There is no imposed limit on the size or functions of government, but it must respect the self-ownership rights of individuals just as any other entity. If I am forbidden from using a piece of property, it does not matter whether that property is owned by Bob Smith, Intel, or the government. Likewise, I cannot be abused, killed, enslaved, or deprived of my rightful property by either Bob Smith, Intel, or the government.
Who noticed me?
I have discovered that several people have reached this site starting with the "Three Libertarianisms" post. This indicates someone has linked directly to that post, but I do not know who. If you do, please email me or leave a comment with a link to the page that links to my post. Thanks.
Free Markets and Labor, er Labour, Exploitation, Take 2
chris dillow has a post on the same topic as my article for The Free Liberal - and comes to the same conclusion. His reasons are very similar to mine, and his discussion of Hayek's views is informative and interesting. dillow's conclusion:
I suspect that a basic income is not only consistent with reasonable libertarianism, but actually necessary for it. In increasing people's bargaining power, such an income can replace minimum wage laws, working time directives and other regulations.
In this sense, equality doesn't undermine a free market - it actively promotes it.
Thursday, June 02, 2005
Private Roads?
Apropos of my post below about Government & Freedom, Robert Capozzi has a post on the (current) "blog" of The Free Liberal responding to an article they posted online by Jonathan David Morris . Morris is explaining the libertarian Non-Aggression Principle, and writes that libertarians believe that for "every single public policy issue - from speed limits and seatbelt laws to national IDs and steroids - there exists the barrel of a gun." Capozzi is skeptical about including speed limits:
The states, operating as stewards in the public trust, establish rules of the road. They are effectively the owners. It's not entirely different than Disney telling its patrons how they must line up to go on a ride. Speed limits help to make the streets reasonably safe places to drive, and it seems to me a perfectly appropriate rule. Maybe they should be higher in some rural places, I don't know. But I certainly don't feel coerced in any way when I see a speed-limit sign.
Test this back against common sense: Can we really imagine no speed limits on Broadway in Manhattan? Or even downtown in Anytown, USA? Anyone, at any time, can drive as fast as he or she wants?
With all due respect, I find this notion ludicrous.
Now, in a technical sense, Morris is the correct one here: In point of fact, Capozzi *is* coerced by the speed limit sign, regardless how he feels, because the speed limit sign *is* enforced at the barrel of a gun. If you doubt this, try driving 90 mph down Broadway in Manhattan and then ignor any cops that try to pull you over. (Or try it on the freeway instead, if it turns out that traffic makes it physically impossible to reach 90 mph in Manhattan.) As Morris states in his article, "You may think it's a rational use of force, and that's fine. You're entitled to your opinion. But the fact that it's force cannot be denied." Morris would say, correctly, that Capozzi is just arguing that speed limits are a rational use of force.
The practically correct person here, however, is Capozzi. Opposing speed limits everywhere in the name of freedom is ludicrous. Further, speed limits are a freedom-enchancing use of coercion. Without them, most people would feel too unsafe on the roads to use them, and a greater number who did use the roads would end up dead. And note here that I not refering just to a "positive" freedom to have free use of a service called the roads, altough that is true, but I am also refering to the libertarian "negative" freedom to have practical access to the land the roads are built on.
And anyway, what would the right-libertarian solution be? To actually let people careen down Broadway in Manhattan at any speed they are able to reach?
Well, no. As any theory-knowledgeable right-libertarian will tell you, the roads should be privately owned. That is, the roads should be owned by actual people, instead of "The People". Well, proabably corporations, actually, but despite what lestist anti-capitalists want you to believe, corporations are not evil, faceless entities, but instead are actual people, unlike the evil, faceless government. Being owned by private entities, the roads will be run in a much more efficient manner. Instead of paying high taxes to a wasteful government to use Broadway, the users would only have to pay for the more efficient costs of the private operator, plus a monopoly premium profit for being the only way to get to the Ed Sullivan Theater to see a taping of Letterman. And don't worry about safety: In order to have reasonable insurance rates to pay out to people injured due to pot holes that the oporator failed to fix, you will be required to drive less than 10 mph in the city and 25 mph on the freeway and always wear protective gear currently used for NASCAR drivers.
And are private roads free of coersion? Morris might think so, I don't know, but the answer is no. Careen down "Private Broadway" without the owner's permission, and they will call the same government to enforce their "right" to eject you from the land on which the road is built. The options are to allow some drivers to coerce others not to use the roads with their reckless fast-moving metal smashing machines, or use guns to coerce everyone to obey certain rules of the road. Whether the decision between the two is made by the government or a private entity that can call the government for enforcement, those are the options.
Personally, I will stick with "The People".
Capozzi ends his post stating:
"Maybe I need a new label..."
I am using "left-libertarian", but I am open to suggestions.
Thursday, May 26, 2005
Freedom - It's Good for Women, Too!
chris dillow wrote a post endorsing compulsory abortions for young women who cannot prove they have the means, both economically and socially, to bring the children up right. He cited a famous study by Steve Levitt that showed that legalizing abortions in the U.S. in 1970 lead to a sharp decrease in crime in the 1990's. He then quoted a long exert from John Stuart Mill's On Liberty that said, in part, "To undertake this responsibility - to bestow a life which may be either a curse or a blessing - unless the being on whom it is to be bestowed will have at least the ordinary chances of a desirable existence, is a crime against that being." I wrote the following in the comments:
The above said, I still disagree with this post. The quote from Mill is in a sense technically correct - restrictions on reproduction are not violations of individual liberty because there are other individuals directly (the children) and indirectly (the society that must share the earth with the new person) affected.
However, Mill is here forgetting everything else in On Liberty about the benefits of diversity of lifestyles and distributing decision-making to the individuals with most direct knowledge of the particular situation.
Levitt's work makes no argument at all for compulsory abortions. Levitt's work shows that the abortion policy of the U.S. in the 70's and on lead to less crime than the abotion policy of the U.S. prior to the seventies. What was the old policy? Restrictions on abortion by most states. What is the new policy? Individual choice about abortion by the woman having the abortion. Levitt's work shows that when women are given a choice about abortion, they make better choices than when abortion is restricted.
AT MOST, this would support experimenting with compulsory abortions in limited jurisdictions as an emprical study to determin if compulsory abortions produce better outcomes than individual choice. But for someone who regularly complains (usually correctly) about "managerialism" in economic policy to describe a study showing individual choice produces better outcomes than government regulation as "a respectable utilitarian case" for government regulation in the opposite direction is bizzare. Maybe, just maybe, what the study indicates is that the belief that individuals tend, as a general rule, to make better decisions than central planners applies to the social realm as well as the economic.
Update: chris write in comments that he opposes utilitariansim and agrees with me about compulsory abortion. He goes on to state, "If we had a sensible welfare state - a basic income with no extra support for parents - the problem of teen mothers would diminish, as I suspect would the numbers of them." Well, I support a basic income, and the parent thing I will not go into for now, so good for him. Presumably then, his post was meant, in part, to impune utilitarianism. I am not a utilitarian, so that's okay by me, but I think even the utilitarian case for compulsory abortion is weaker than he suggests.
Tuesday, May 24, 2005
Government vs. Freedom?
I wrote the folloeing in the comments section to this post by Matt Welch:
Everybody here who can not see how the Democrats could ever be moved in a libertarian direction is clinging to a traditional (right) libertarian assumption that is emperically untrue. Braodly speaking, the libertarian project in America has been about aiming toward three over-arching goals:
1. Greater economic freedom
2. Greater social freedom
3. Less government
How is it going? In my lifetime:
1. Economic freedom has increased dramaticly. Lots of deregulation, no more wage & price controls, much greater free trade.
2. Social freedom has increased dramaticly. Women and minorities make gradual gains every year, there is more sex in every media each year, and gays can marry in one state.
3. The government has increased dramaticly, both in real terms and as a percentage of the national economy.
I have seen optomistic libetarians point to the first two accomplishments and predict the eventual whithering away of the government. And I have seen pessimistic libertarians point to the last "failure" and predict we will soon be living in a totalitarian theocracy.
Now, I do not necessarily believe that bigger government caused the gains in freedoms, but the emperical evidence proves one fact beyond a doubt: Big government is not necessarily incompatible with freedom.
And I would definately argue that some forms of big government could certainly cuase greater freedom. Matt can lecture the rest of you about how national health insurance can promote freedom. I argue that a basic income would promote freedom when compared to the current Nanny Welfare State. Heck, the highway system, people? Don't you like being able to drive to anyplace you want?
Are some government programs EVIL? Of course. (Poster child - The Drug War) Can some goverment programs be administered in a more pro-freedom fashion? Again, yes. (My basic income vs. welfare state example) But a vision of libertarianism that recognizes that government is not always the emeny - and can even, on occasion, be an ally - is a vision of libertarianism that can gain power in the Democratic Party.
Ego Post
Cool! Ampersand "elevated" one of my comments to the introduction of another post.
I should probably write more about this from a left-libertarian POV, but I am really am confused about this at the moment. I am fat, I support government health research, I am skeptical of the current anti-fat research, I want to lose weight, I need to eat healthier and exercise more regardless of my weight, I think health and safety issues offer the best argument for overcoming libertarian presumptions, and I do not want the government regulating what people eat.
So I really am confused about this. Worse, I really was eating Pop Tarts.
Friday, May 20, 2005
Homophobia used to be a good idea
I wrote the following in the comments to this post at Alas, a Blog:
This is a good post, but there is a word I was surprised not to find in it - rape.
I did an independent study in law school on this subject, writing what amounted to a master's thesis. I was specifically looking for the origins of legal repression of homosexuality. It turns out there was very little repression of lesbianism prior to the 20th century, and all of the repression of male homosexuality had to do with sodomy. At one point in my research, I read Dowrkin's Intercourse and got the epiphany. My understanding of Intercourse was that Dworkin thought that sex was natually rape, but more importantly, that this was not radical, but the TRADITIONAL view of sex. Consider the famous statement of the California state Senator to the feminists lobbying to criminalize marital rape: "But if you can't rape your wife, who can you rape?" Was this traditionalist's view of sex any different from the view conservatives "smear" Dworkin for having?
Foucault's History of Sex Part I revealed that while male homosexuality was common in the Greco-Roman culture, it always involved a man of superior status "using" a young man of inferior status, and writers of the time considered this a big problem for someone who would eventually be a citizen to be used this way for sex. The Greco-Roman view of sex was also very violent, with rape being Zues's favorite hobby.
Essentially, the development of homophobia in the West was a cultural advancement: Its purpose was to protect men from rape.
Feminism is therefore a necessary precusor to gay rights. We have to accept that no one deserves to be raped before there is no longer a cultural need for homophobia. Otherwise, we risk going back to the Greco-Roman view of sex, which was worse than what the American tradtionalists are defending.
Would reporters have treated Clinton this badly?
Shorter David "Not Rush" Limbaugh: Waahhh!! Reporters are asking question of the Presidential Spokesman that are not properly differential to our magnanimous overlord!
At least Republicans are not hypocrits
Shorter Rich Lowry: It is okay for Republicans to promote conservative women and minorities for political advantage, because they admit to being racist and sexist. But when Democrats target conservative women and minorities for the exact same reasons, they are being hypocrits because they are betraying their ideals.
Thursday, May 19, 2005
The Creative Commons
I have added a Creative Commons license to this blog. I doubt it will have any effect at all on anyone publishing my stuff, but I want to add my "vote" to the millions who have supported the concept. Plus, Larry Lessig's wife is an attorney in my firm. I believe the version I picked, attribution, non-comercial, share alike, will eventually become a standard for digital media, and will be where artists and writers start off, with the most famous then perculating up into for-profit commercial venues.
We can also pause here and consider the problem that all intelectual property poses for deontological right-libertarianism. One of two positions are logically possible.
The first is that intellectual property should not exist. There is no "thing" that can be owned, and the government creation of a monopoly on the use of an idea is close to mind control. But than how do you compensate creators for the good that they add to the world? And how to you provide for economic support for the creation of arts and inventions? Sure, eliminating intellectual property would have little effect on the creation of new music, short stories, and political commentary. But how could you fund the next Hollywood blockbuster or the next treatment for cancer?
The second possibility is the other extreme. Unlike objects made from material that existed in the universe befor humans arrived, intellectual property represents a pure creation of the labor of a sentient being. Therefor, intelectual property rights should be absolute and last forever. We have a moral duty not to publish or perform the works of Sophocles unless we track down his decendants and pay them royalties for the use of his works. (Unless some intermediate decendant voluntarily transfered those rights to others, and then we must track down the decendants in interest of Sophocles' intellectual property rights.)
Some deontological left-libertarians may have such problems as well, but most would say that your labor gives you only a life estate in the property you create and therefore declare that intellectual property terminates when the creator does. (A corporation being a creation of laws, if the left-libertarian believes they should exist, she can just state that there is no problem in legislating the length of corporate copywrite, if she also believes copywrites should exist.)
I am not a deontologist, I am a consequentialist social contractarian, so I have none of those problems.
Wednesday, May 18, 2005
Bruce Bartlett took a hit of LSD
That's the only explanation I can think of. Bruce Barlett is one of the more lucid conservative commentators out there. But the following is the opening paragraph of his new column:
I don't believe in coincidences in politics. When I see the Wall Street Journal and New York Times both running big front-page stories within two days of each other on a subject that isn't remotely time sensitive, I know that something is going on. More than likely, it signals the beginning of an organized campaign by the liberal media to gin up an issue for the Democrats.
Okay, he is entitled to the general conservative belief that the mainstream media is the "liberal media", a fading-but-still-slightly-true characterization. And he is certainly entitle to call the New York Times "liberal". In any other industrialized country it would be "centrist", but here, okay, "liberal". And he is also entitled to present his (probably wrong) case against the thesis that there is little class mobility in America.
But the Wall Street Journal is part of "an organized campaign by the liberal media to gin up an issue for the Democrats"?!?!?
He took a hit of LSD. Or some other hallucinogenic drug. It is the only possible explanation.
Tuesday, May 17, 2005
Ginivan promises further response
Matt Ginivan has taken note of my reply to his commentary. Predictably, he responds to my taunting him about his Ivy-League education rather than any substance, although he promises more to come.
My real take on Ginivan's motives and mistakes: Ginivan is a passionate young idealist with a dangerous amount of knowledge in political economy. (Ref: "A little knowledge is a dangerous thing.") Some political economy text assigned in one of his classes presented the (entirely reasonable) price-setting and wage-setting fomulas he used in his response to me. Then in the middle of some discussion, in a certain context, the text stated that "x", which refered to the manufacturer's mark-up percentage based on their market power, the text stated that x is a constant. Matt misinterprets this to mean that x is a constant in all circumstances. Then he read my article, which offended his right-libertarian ideals. Energized by his idealism and misunderstandings, he does some calcuations which seem to prove that my plan will not help wages rise His blindness to his ideology makes him miss that he is begging the question and the absurdity of claiming that a manufacturer can continue to charge the same markup percentage in the face of rising costs. Being someone who is smart enough to get into an Ivy-League school, he is good at writing convincing-sounding B.S. - especially when he believes it. So he does, and it sounds good enough for The Free Liberal to post it.
My prediction for his response: His best stategy, I think is to track down whatever text states that x is a constant, then cite that statement out of context, noting the eminence of the author. He can also accuse me of being jealous of his education, or maybe of harboring egalitarian hatred of meritocratic institutions. I will probably just ignor such charges or make fun of them, but I am somewhat perplexed about what I would do about a citation. I am not sure I have the resources necessary to track down his source to view the context. But I am sure I will think of something. Capozzi's comments lead to conceessions on my part because he was being thoughtful and reasonable. Ginivan, whether he knows it or not, is just spouting bullshit, and I have never had any trouble exposing bullshit.
Friday, May 13, 2005
Left Libertarianism
Left-libertarianism agrees with right-libertariansim that strong property rights and economic freedoms are esential to individual liberty. However, left-libertarians seek to create mechanism that will empower all individuals with their own property or income. This is usually accomplished through either direct redistribution or a recognition of certain forms of property as held in common ("Predistribution"). The forms of property held in common depend on the particular left-libertarian theory, but the form of property included in the largest number of left-libertarian theories as held in common is land. Property held in common refers to equal rights of access, and is distinquised from collective rights, where everyone must agree on uses. Use of property held in common can be tansfered by the community to individual entities, but the community must be compensated. Direct redistribution theories rely on recognition of the marginal utility of money.
Resourses for left-libertarianism on the web include Progress.org, The Free Liberal, Mutualist.org, and Left-libertarianism: A Primer. Classic left-libertarian theorists include Thomas Paine, John Stuart Mill, and Henry George. Modern left-libertarian theorists include Hillel Steiner, Peter Vallentyne, Philippe Van Parijs and arguably Amartya Sen. The most successful politician who was relatively left-libertarian was probably Thomas Jefferson, although obviously many of his social veiws would be considered worse than fascist by today's left-libertarians.
Wednesday, May 11, 2005
More on the Basic Income Guarantee
The Free Liberal has posted my reply to the Princeton punk, and Robert Capozzi has posted another response. In his response, Capozzi hits the best left-libertarian objection to the basic income, "My real fear is that the basic income would be additive, not a substitute. That tends to be the way of Washington. Realpolitick and history indicate that strong tendency. Until I see that the basic income could be a substitute, I'm not saluting."
This fear is justified, and I do not have a great answer, except to say that I stongly believe that the masses desrve compensation for the goodies passed out to the rich by the current system. The mixed-economy neo-liberals / neo-conservatives are in charge, and getting them to accept a basic income would be a matter of evolution, not revolution. So, the basic income would need to be phased in first, and proven to work, before we could discuss dismantling the old welfare state. This offers no assurances to Capozzi, who is right to point out that the history of government programs does not suggest that it is easy to get rid of those that have outlived their original purpose. The best compromise that is practically achievable would be to have the basic income, as it is phased in, considered to be "earned income" for purposes of welfare payments, and thereby slowly eliminate welfare programs by slowly eliminating the number of people who qualify for them. This still does not address issues like the minimum wage, and Capozzi is right to be skeptical about eventual repeal.
Note: The article includes a reference to "Figure 1", but the Free Liberal does not seem to have posted the graph. Unfortunately, I can not post graphs on this blog to compensate.
Tuesday, May 10, 2005
Contest: What Radical will Conservatives Steal Next?
Okay, Thus far we have seen conservatives claim:
Martin Luther King Jr. would oppose Affirmative Action.
Ceasar Chavez would support the Minutemen Project.
And my personal favorite:
Jesus Christ opposed Estate Taxes.
So what's next? Today, in a column by Brian McNicoll, a Senior Writer for The Heritage Foundation, the most prestigious conservative think tank in America, McNicoll complains that scientists need to learn a humility, and accept that the uninformed opinions of people who have never studied biology beyond high school might be just as valid as the consensus view of every biologist with a Ph.D. Such closed minded scientists believe, according to McNicoll, that "all issues regarding the origin of life are settled."
How does McNicoll respond to this?
When I hear such talk, I can't help but think of the distinguished members of the scientific community who killed George Washington by using leeches to cure him of what amounted to a bad case of the flu. Or the study that came out just this week saying that a procedure performed a million times a year in this country on women during childbirth not only doesn't help them but makes things worse. Or the sad treatment of Galileo, a distinguished scientist who spent the last years of his life under what amounted to house arrest because he'd been convicted of heresy for asserting that the earth orbited the sun, rather than the other way around.
That's right folks. The fate of Galileo, who was sentenced to life imprisonment by the Catholic Church for reporting his scientific findings about the sun and the earth, demonstrates that we need to teach religious theories of biology as being equally valid to those offered by empirical scientists.
Proposed contest: What radical thinker will next be used to support the conservative agenda? I will start with my own prediction:
We must invade Iran (or Syria, or where ever)! It's what Gandhi would have done.
Remember, given the above examples, this isn't satire, it's merely speculation.
Right - Libertarianism
Right-Libertarianism is the philosophy that in the United States is usually just refered to as "libertarianism". The idea is that self-ownership is best expressed in the world though strong property rights held by individuals or voluntary associations of individuals. Capital should be owned and controlled privately, just as all (or virtually all) other property should be owned and controlled privately. Right-libertarian theorists disagree as to the full extent of ways which property rights can arrise, but all agree that they will arrise when an individual "mixes" her labor with unowned property. The property rights gained this way (and possibly other ways) are eternal, even though the individual is not. Strong or absolute property rights include the right to transfer these property rights to other individuals for whatever reason the transferor wishes, including the receipt or promise of labor or other property in exchange. Thus, distribution must be allowed through free markets.
Right-libertarian theorists include Ayn Rand, Murray Rothbard, Robert Nosick, Milton Friedman, David Friedman, and Frederick Hayek. Excelent Web Resources include reasononline, The Cato Institute, and LewRockwell.com. Dispite many more recent pretenders, the only famous political leader who could reasonably be described as a right-libertarian was Barry Goldwater, although his foreign policy views were too agressive for most libertarians.
Friday, May 06, 2005
Libertarian Socialism
This is the form of libertarianism I know the least about. Two great indroductions on the web are this one from flag.blackened.net and this one from Wikipedia. Libertarian Socialism was what was first meant by the term "libertarian" when the term arose in the later part of the 19th century. Libertarian socialists want to free individuals from both the state and the boses. They believe that property is theft, and see the state as the agent of the bosses, the coersive muscle who enforce the boss's "right" to extort labor and profits from the masses. They want to liberate the masses through socialism, which is defined, according to the blackened flag site as "the workers democratic ownership and/or control of the means of production". Some go beyond production, and advocate democratic control of distribution, such as Michael Albert in Paracon: Life After Capitalism. (Albert actually rejects the term "socialism", but his beliefs fall squarely within the libertarian socialist tradition.) The blackened flag site states of libertarian socialist theorists, "Aside from the significant number of anarchist theorists such as Pierre-Joseph Proudhon, Mikhail Bakunin, Peter Kropotkin and Alexander Berkman, some important contributors to libertarian socialist theory and philosophy would be Noam Chomsky, Daniel Guerin, and Murray Bookchin. " The most successful political leader who could reasonably be described as a libertarian socialist was probably Mahatma Gandhi.
Thursday, May 05, 2005
Democrats vs. Republicans
Via Democratic Freedom we find a study from CATO on the massive spending of the Republicans. Bottom line: "Even after excluding spending on defense and homeland security, Bush is still the biggest-spending president in 30 years."
Meanwhile, a week and a half ago, Matthew Yglesias wrote a post that began by quoting Andrew Sullivan quoting Barry Goldwater complaining about the Religious Right trying to legislate morality. Then Matthew writes:
He then goes on to "wonder if Goldwater could even exist within today's Republican establishment." Well, of course he could. In Maine or Rhode Island or New York or California. But as a national leader? No way. Indeed, probably most Democrats would hesitate to speak so disrespectfully of the people in question, though they might privately agree. The way in which the rhetorical center of gravity has shifted to dramatically to the right freaks a lot of people -- certainly Andrew Sullivan -- out a great deal. But what about the policy substance? Well, abortion has moved slightly to the right since '81, mostly as a result of things done during the Reagan years. School prayer has moved somewhat to the left, and the GOP platform has moved left on the subject as well. Gay rights have moved way to the left in the past 25 years. And there's every reason to think that the next Democratic administration will push the gays-in-the-military issue further left (note that Bush hasn't tried to roll Clinton's steps on this back), offer federal funding to stem cell research, and make Plan B contraception much more widely available. I don't really understand how it is that the rhetoric and policy have moved in such different directions, but that's the reality of the situation.
Okay, I am left-libertarian, and so I have less of a problem with many types of government spending than right-libertarians. But at this point I really cannot see how a right-libertarian could possibly prefer the Republicans to the Democrats. In fact, I fail to see how a right-libertarian would not possibly prefer the Democrats by a large margin. The Republicans spend more money than the Democrats, AND they are worse on social issues. Even a Democrat who is lousy on social issues (Lieberman, or any Dem from the Confederacy) is not going to do any real damage in that area since, as described by Matthew, the government's efforts to legislate morality are impotent. But the government is quite competent at writing checks, and the Republicans write more than the Dems. Is it because of the tax "cuts"?!? Is merely shifting taxes to children and the poor really what right-libertarianism is all about?
Friday, April 29, 2005
Self-Ownership
Self-Ownership is a definitional issue for libertarians. It is what unites the three libertarianisms and makes each libertarian. The idea behind self-ownership is that each individual human owns herself. She owns her mind, her thoughts and her physical body, and has final veto power over what is to be done with her mind and body. This is what makes the individual free. This is liberty.
I defined self-ownership here in an EXTREMELY negative fashion on purpose. "Negative liberty" is usually described as the "the right to be left alone", but my description here is even more narrowly negative - "veto power". This is because the inherent problem of what to do with external objects that multiple persons may want to use results in restrictions on positive freedoms. Who makes these restrictions, how they are made, and the content of these restrictions are what separates the three libertarianisms. It is impossible to define liberty as more than veto power over you body because any of the three broad theories can develop restrictions on the use of external objects logically consistent with self-ownership that can effectively prohibit an individual from doing anything. A libertarian socialist system can be set up that prohibits all private use of external objects for production of goods or services, and forbids the acceptance of money, goods, or services in exchange for performing any labor. A right-libertarian system can be set up such that all external objects are already owned by other individuals when you are born, and none of the owners ever chooses to sell anything other than immediate consumables (such as food and entertainment), and instead leases all land, transportation, furniture, and clothing with severe contractual limitations on their use. A left-libertarian system could declare all atoms external to live humans to be owned in common, and require a democratic consensus for any proposed use. Almost nobody actually supports any of these extreme and unfree versions of the three libertarianisms - they are usually conjured up in the heads of libertarians of the other two stripes (and sometimes by non-libertarians) as a way of claiming that form of libertarianism to be UN-libertarian. But they work as criticisms because each is a logical possibility under that libertarianism's premises.
However, while each form of libertarianism can be stretched to restrict actions to a very unfree degree, what NONE of them allow is to COERCE an individual to do anything. Slavery, forced labor, rape, assault, and military conscription are forbidden under ALL forms of libertarianism. Libertarianism does not require society saying "Yes" to everything an individual wants to do. But libertarianism does require that the individual be allowed to say "No" to anything.
Wednesday, April 27, 2005
Three Libertarianisms
Over the next week or so, I plan to write posts/essays defining the three broadest forms of libertarianism, in order to provide a basic description of the goals of the emerging left-libertarian political movement. For a good background on left-libertarian political philosophy, see Left-Libertarianism: A Primer by Peter Vallentyne. My definitions will be briefer and broader, attempting to describe the goals of the practical activist side of each movement. I will focus on how each movement relates to self-ownership, property rights, economic production, and economic distribution. I plan to write them in the following order:
1. Description of self-ownership, common to all forms of libertarianism.
2. Libertarian Socialism
3. Right-Libertarianism
4. Left-Libertarianism
Update: I have completed the planned posts, and they can be reached by clicking on them.
Update 2: What do libertarians think of government? Click here for three possibilities.
Wednesday, April 20, 2005
My Corporate Tax Rant to Libertarians
I just posted the following in the comments section to this post at MaxSpeak, in response to an earlier post by Jane Galt suggesting the elimination of the corporate tax:
God**** it, Jane, why do corporations exist?!?
Please, please, please, get this through your libertarian head: Corporations DO NOT exist in nature. They are created by the GOVERNMENT. They are given rights and powers in the ecconomy far beyond what individuals or partnerships are capable of - including, but a lot more than, limited liability.
These extra rights granted by the government to these government-created legal fictions have vast amounts of ecconomic value. This is obviously true, or no one would bother to create them, and they would not have come to dominate the ecconomy.Thus, the EXISTENCE of corporations is a MASSIVE GOVERNMENT HANDOUT. Why the f**k should we allow this?
There are only two legitimate libertarian reactions:
1. We should not allow this, and all corporate codes and corporate charters should be repealed.
2. Corporations should exist only to as a means of maximizing their net positive externalities, which include being a voluntary way of raising revenue for the government - remember, no one put a gun to anyone's head and forced them to form or invest in these government handouts. Therefor, they should only exist if we tax them at whatever rate will compensate for their negative externalities and generate a maximum amount of revenue for the government.
As far as why we should tax the revenue in the corporation instead of when received by the investor:
1. Morality: The corporate tax is a voluntary fee for taking advantage of a government creation, while taxes on individuals are theft from natural people.
2. Practical: Any time the corporate tax is lower than the individual investment taxes, the corporation is a tax avoidance scheme by its very existence, since it allows for tax-deffered reinvestement.
/rant
Update: I reworded the second legitimate libertarian reaction in response to futher comments to Max's post.
Tuesday, April 19, 2005
Yum! Ivy League Punk Steaks for Dinner!
So, in addition to the fairly reasonable cautious response from one of its editors, The Free Liberal has now posted a second response to my article from the captain of the Princeton University rugby team. Basically, it's bullshit with formulas. Strip away his bullshit formulas, and the criticism is nothing but question-begging: One of his premises directly contradicts my argument without explaining WHY I am wrong, so of course his conclusion contradicts my conclusion. Computer programers call this "GIGO" (Garbage In, Garbage Out).
Therefore, I am now working on a reply which will explain exactly why his argument is bullshit, hopefully with graphs. Writing replies is one of my most enjoyable tasks as an attorney. It is usually fairly satisfying to feast on the meat of a stupid critic, but Ivy League meat tastes the sweetest.
Friday, April 15, 2005
Abstinence Education
For those interested in learning about abstinence, check out the Abstinence Only site for proper abstinence education.
(P.S. I am participating in googlebombing, for whatever a link from my site is worth.)
Republicans On Drugs
Via Hit & Run, we learn:
Rep. James Sensenbrenner (R-Wis.), chairman of the House Judiciary Committee, has rewritten his Defending America's Most Vulnerable: Safe Access to Drug Treatment and Child Protection Act (known by the catchy acronym DAMV:SADTCPA), which he introduced before the Supreme Court's decision in U.S. v. Booker. Apparently Sensenbrenner decided DAMV:SADTCPA wasn't draconian enough. The bill, which has been passed by a subcommittee and will soon be considered by the full House Judiciary Committee, retains the 10-year mandatory minimum sentence for anyone over 21 who supplies any quantity of any drug to someone under 18, with a life sentence for a second such offense. In addition, according to an analysis by Families Against Mandatory Minimums, the bill would:
* make the sentencing guidelines mandatory again, forbidding downward departures in almost all cases;
* virtually eliminate the "safety valve" provision for low-level, nonviolent drug offenders;
* create a three-year mandatory minimum for parents who see or hear about drug dealing targeting or near their children and fail to report it;
* create a 10-year mandatory minimum for parents who sell drugs when their children are nearby; and
* increase the mandatory minimum for selling drugs in "drug-free zones," which in practice cover almost anywhere within many cities, to five years.
Umm, what was that middle one again?
Okay, so I take my four-year-old to the park, let him run on the playground while I read the paper. I look up, and see a local gang member sell pot to someone while leaning on the poles holding up swings my son is swinging on.
My choices are now:
1) Do not report this to the cops, and risk a mandatory 3 year minimum sentence in Federal prison, or;
2) Report this to the cops, and risk a gang member blowing me full of holes.
I suppose we should be lucky that they only limit this dilemma to people who are responsible for the care of children...
Libertarians for Socialized Medicine
The Democratic Freedom blog has a post arguing that libertarians in the Democratic Party might consider compromising on socialized medicine.
We left-libertarians who believe in the right to a basic income will almost all agree that health insurance is an item that can be provided as part of the in-kind basic income. If EVERYBODY needs it, and the government can provide it cheaper than the market with at least the same effectiveness - as can be shown by comparisons with the many countries that have socialized health insurance, why not?
The first comment there, by Kevin Carson, is also excellent: Essentially we do not have a free market now, we have a crony corporate socialism system. Generally, it is best if the government does not screw around with markets. Either the government should just provide the service itself in an extra-market fashion, or it should just give the people the money to buy the stuff on the market theirselves.
Great Achievements of the Suffragists
I responded to a somewhat tangential statement in a post by Amanda at Pandagon in the comments with the following:
Suffrage for women is a prime example of this. Feminism got hung up on one issue--the vote--but once that goal was achieved, it blew the doors wide open and women finally had the social status to start achieving all sorts of change.
No, no, no! Why does EVERYONE, liberal, conservative, sexist, or feminist, forget the other great success of the suffragist movement - equal property rights. The suffragists got married women the right to own property and had inheritence laws changed to treat all children equally without regard to sex. In a democratic capitalist society, equal property rights are just as - if not more - important as voting rights to achieving other forms of change.
The difference between the late 20th century black civil rights movement and the feminist movement was that the blacks, having been freed a century earlier, were finally trying to seise equal power in society. The feminist movement was not about seising power, it was about trying to convinence women to exercise the power that the suffragists had seised a generation before.
Really, with over half the votes and probably over half the money, if feminists only succeeded in bringing all women around to their cause, it really wouldn't matter what we men think at all.
Does the Estate Tax force Small Business closurers?
No. To know why, read this response from Stuart Levine to a post by Matt Yglesias. Short Version: The IRC already allows business passed at death to pay the tax as a loan, and the interest rates are awsome.
Edwards on Tax Fairness
From John Edwards' mass email:
Yesterday, at the New School in New York, I am joining a group of leaders from around the country to discuss the issues of fairness in America. To me, there is no place where fairness is more at risk today than in America's tax code. The reason I started talking about two Americas is that this administration wants our great country to run off two sets of books: one for those at the top who get all the breaks, and one for the rest of you who do all the work. That's wrong. If we're going to be one America, not two, we must have one tax code, not two. Not only is the current system already stacked against working Americans, but our opponents want to make it even worse. Our opponents want to shift the tax burden from unearned income straight on to the backs of working people. They want to give the wealthy more favors and call it reform, and they want working people to foot the bill. This radical notion turns on its head the very values that built America - rewarding hard work. This is the time to stand up for the great American value: work. This is the time to say that a stockbroker should never pay a lower tax rate on wealth than a secretary pays on work. This is the time to say that the wealthy and powerful shouldn't have access to special shelters and loopholes that regular people can't use. And this is the time to say that we want a tax code that rewards everyone's work to build everyone's wealth. We must take away the biggest shelter in the current tax code: the fact that the very wealthiest are able to shelter capital gains and dividends from the Alternative Minimum Tax. The very purpose of the AMT is to make sure the very wealthy pay their fair share and leave the middle class alone. But thanks to this administration, the AMT is doing exactly the opposite. It is increasingly hitting middle class families all over the country. President Bush likes to talk about himself as a tax-cutter, but the truth is that the AMT is a big tax-raiser on many middle-class families. At the same time, the AMT is not taxing many of the multimillionaires it was meant to tax. Why? Because the wealthy have the sweetest shelter in the business: their capital gains and dividends get special breaks from the regular rate in the AMT. Doing away with tax shelters for multimillionaires is just the beginning. We have to also make it easier for working middle class families to pay their taxes, and I present some ideas for making filing your taxes and saving for the future easier to do in the full the text of my speech, which you can read here. I hope you will read it, and let me know what you think by visiting my blog to continue the conversation. Your friend, John
Thursday, April 14, 2005
From Rule of Law to Mob Rule
Via Atrios, I actually clicked through and read the real quote because I figgured that Atrios was changing it to make an exagerated point, but no, here is our actual House Majority Leader:
Mr. DeLay: Not zealous. I blame Congress over the last 50 to 100 years for not standing up and taking its responsibility given to it by the Constitution. The reason the judiciary has been able to impose a separation of church and state that's nowhere in the Constitution is that Congress didn't stop them. The reason we had judicial review is because Congress didn't stop them. The reason we had a right to privacy is because Congress didn't stop them.
Wow. Just, wow.
Wednesday, April 13, 2005
Response from Free Liberal
Robert Capozzi, one of the editors of the Free Liberal, responded to the article I wrote for them.
Tuesday, April 12, 2005
Would a Free Market periodical publish an article that claims that Capital exploits Labor?
Check out this article at Free Liberal by Timothy Roscoe Carter.
Wednesday, April 06, 2005
The Coming Bush Tax Shift
The following article by me apeared in the San Francisco Daily Journal a couple of weeks before the last presidental election:
Recent federal tax laws have continued a quarter-century trend of shifting taxes from wealth to work, primarily benefitting the top 1% income bracket. Even among the top 1%, the tax burden is heavier on those who work for their money than on those whose money works for them.
Last month, the Congressional Budget Office (CBO) calculated the change in the share of total federal taxes due to the Bush tax laws. The CBO, a nonpartisan government agency headed by a former senior economist from the Bush administration, clearly shows who benefits.
The highest quintile is the only income bracket that has a reduced share of total federal taxes in every year up to 2010, when the Bush cuts sunset. The reduction in share of the federal tax burden due solely to the change in laws for those in the top 1% is three times the average reduction for those in the top 20%.
The tax burden has been shifted to wage earners. From 2001 to 2010, the change in the share of the tax burden for those in the lowest 20% income group is 0.0%. If your income is between the bottom 20% and the top 20%, the tax burden has been shifted to you.
Citizens for Tax Justice (CTJ) calculates that without sunsets, the top 5% income bracket would see a reduction in their share of the tax burden, with the reduction greatest for the top 1%. Without sunsets, the bottom 95% income bracket would see an increase in their share of the tax burden in 2010.
Why this disparity? CTJ released a paper in May 2004 showing that total federal personal taxes paid on wages and other earnings now average 23.4%, while federal personal taxes on investment income average only 9.6%. Taxes on earnings are almost two and half times taxes on investment income. Plus, taxes on investment income are only 11% of total personal taxes, while investment income makes up 22% of total income.
Does the tax shift to working people matter if taxes have gone down for everyone?
First, it is simply not true that the Bush tax shift has reduced everyone's total federal tax rates for more than a few years. According to the CBO, the total effective federal tax rates for every quintile are lower in 2004 than they were in 2001, when Bush's tax shift was enacted. But beginning in 2005 and continuing through 2010, the total effective federal tax rates for every quintile in the bottom 80% will be higher than in 2001. And in 2009 and 2010, the total effective federal tax rate for even the average person in the top quintile will be higher than it was in 2001. For those in the top 5%, their total effective federal tax rate will still be lower.
This is current law. Reality may be worse. Bruce Bartlett wrote in National Review Online that taxes will likely increase beginning next year, regardless of who is elected President. The reason is that the heavy spending enacted while tax revenues were reduced has resulted in a huge public debt that will have to be paid. Bartlett writes, "Since fiscal year 2000, the federal budget has gone from a surplus of $87 billion to an estimated deficit of $675 billion. In the last four years, the national debt has increased by almost $2 trillion and will continue to increase for many more years even under the most optimistic scenario, absent legislative changes."
The CBO reported this month that under current law the national debt will increase by $2.3 trillion over the next decade, and that could double if Bush's cuts become permanent. Federal Reserve Chairman Alan Greenspan testified that without legislative changes, government borrowing will eventually crowd out private borrowing and drive interest rates higher. The government would have to pay higher interest, increasing the debt even more, creating a downward fiscal spiral.
Could the necessary legislative changes include reductions in federal spending? Only in theory. John Kerry wants to maintain the occupation in Iraq, increase troop levels by 40,000, protect Social Security entitlements, and expand healthcare to more of our nation's 44 million uninsured. Any spending he may want to reduce must be minuscule in comparison to these commitments.
Those who want to vote for someone who talks a lot about restraining government spending can vote for Bush. Bush claims that Kerry is someone who has been in federal government for 20 years and has decided that it is not big enough.
However, in his first four years in federal government, Bush himself has increased non-defense federal spending more than the five Presidents before him. According to the Cato Institute, Ronald Reagan was the only President of the past eight (including Bush II) to serve a full term and reduce nondefense federal spending in his first four years in office.
In ascending order of free spending, Clinton increased nondefense federal spending 0.7% in his first four years, Carter increased it by 7.6%, Bush I by 13.9%, Nixon by 22.5%, and Bush II by 25.3%. Only Johnson, pursuing a War on Poverty, beat Bush II, increasing nondefense federal spending by 34.2% in his first four years in office. Bush II's achievement here does not even count the War on Terror or the Wars on Iraq or Afghanistan.
Bush II is not alone in his party. According to Reuters, on November 30, 2003, over a year after the Republicans won the midterm election for both houses of Congress, Republican Senator John McCain stated, "Congress is now spending money like a drunken sailor." The Republican Party Platform adopted at their convention this year only states, "...our leaders must make sure that the growth of the federal government remains [sic] in check." Actually reducing federal spending is not a stated goal.
If taxes do rise next year, who will pay? John Kerry has proposed repealing the tax cuts for those making over $200,000 per year, and his running mate consistently condemns the current administration for shifting taxes from wealth to work. But Kerry also wants to lower corporate income taxes by 5%.
Bush and the Republicans seem convinced that it is bad for the economy to tax investment income at the same rates (or higher) as wage income. And they seem committed to ending the estate tax. Currently the estate tax is levied only on those who leave multimillion dollar estates. If eliminated, and the revenue is replaced, it will be difficult to find a new tax that does not fall on people poorer than those who currently pay the estate tax.The challenger this election has called for tax increases on those making over $200,000 and campaigns against shifting taxes from wealth to work, but admits he will increase spending and wants to reduce corporate taxes by 5%. The incumbent talks about restraining spending while fighting two wars and increasing nondefense spending more than three times faster than Jimmy Carter, and talks about reducing taxes while merely shifting them into the future and onto workers. Bartlett ended his article for National Review Online stating, "Therefore, taxes will be on the table. Voters need to ask themselves which party they prefer to manage this process when the time comes."
Friday, April 01, 2005
Smash the Nanny Welfare State!
The following article by me was first published in the San Francisco Daily Journal on August 13, 2004:
A review of the various federal programs designed to provide assistance to the poor in the United States reveals a definite pattern with regards to who should be and who should not be recipients of public generosity. The term "Nanny State" is often used to describe paternalistic government actions that control citizens for their "own good", making decisions for individuals that adults should make for themselves, such as whether to use seatbelts or eat junk food. We are running a nanny welfare state, not designed to free or empower the poor, but rather to use cash and services as rewards for those deemed worthy, and depravation of necessities as the punishment for those who are not.
The program that in the popular mind is most closely associated with the term "welfare" is the Temporary Assistance to Needy Families (TANF), the famous federal welfare reform act passed in 1996. TANF is a cash benefit program designed primarily to help families whose parent(s) is/are out of work. Employable recipients are required to participate in vocational programs intended to help them become employed or transition back to work. There is a 60-month lifetime time limit on the receipt of benefits for most parents.
Another program popularly associated with the term "welfare" is Food Stamps. Broadly available to people who meet the income and asset requirements, this program does not provide cash, but it provides vouchers that can only be redeemed for specified food.
A larger welfare program is the one usually referred to in common usage as being "on disability": Supplemental Security Income (SSI). SSI provides an income for people who meet the income and asset requirements and are either over 65 or are incapable of working due to permanent disability.
The largest welfare program run by the U.S. federal government, in terms of both money distributed and number of recipients, is usually not thought of as "welfare", primarily because it is administered by the Internal Revenue Service. The Earned Income Tax Credit (EITC) provides a supplemental benefit for low-wage workers with little income. There are minor benefits available under the program for the poorest of poor workers who have no children, but the lion’s share of the benefits go to low-wage workers with minor children. The EITC is a "refundable" credit on a person’s individual income tax, and is administered through the process of filing tax returns. When the EITC is referred to as "welfare program" in the popular media, it is usually by a critic of the program who intends the statement as an insult.
What all of these programs, and the many other smaller ones that make up our federal government’s welfare state, have in common is the attempt to distinguish the "deserving" poor from the "undeserving" poor. A table inside the recent book, Fighting Poverty in the US and Europe: A World of Difference, by Alberto Alesina and Edward Glaeser, reveals that 60% of Americans believe that the poor are lazy. Our welfare state is meticulously crafted to prevent any of these "lazy" people from getting a dime of our tax money.
The nanny welfare state forces the poor to prove they deserve our charity. They have to prove their income is low. They have to prove they have little or no assets. If they can also prove that they are old or too disabled to work, we will give them SSI. If they are working and have children, we will help them with EITC. If they are not working and have children to take care of, we will reluctantly help them with TANF, but only if they can prove that they are trying to go back to work, and only for a short time. If they are starving, we will pay for their food, but only with strict limitations (we aren’t giving them cash to go out and buy just whatever they want). We make the poor fit into little boxes. Those poor outside of these little boxes are deemed unworthy.
But snug boxes can be difficult to escape. Means-testing encourages dependency. Needs based assistance programs provide incentives for poverty, and punish attempts to rise out of it. Disabled persons with savings and investments must spend themselves into poverty to obtain an income. Those receiving SSI who have a big windfall ask their representatives for advice on "spending down" the money to the maximum asset level. Even the attempts to push those who receive TANF to go to work can create generational cycles of poverty. Cutting a mother off of TANF and forcing her to work two minimum wages jobs to feed her children who spend all of their waking hours in overcrowded daycare, if available, may be good for the employment numbers, but children who rarely see their parents do not grow up to be productive and well adjusted citizens. They usually end up stuck in poverty, just like their parents. And after the 60 month limit is up, if the now forever disqualified from welfare parent becomes unemployed, the consequences to the children will be even more dire.
But the Nanny Welfare state is flawed not only because of counter-productive results. Nor is it flawed simply because the belief that the poor are lazy is factually inaccurate. The philosophy upon which it rests is unjust. The idea that welfare is a form of charity is predicated on the belief that some people have no natural right to an income. Some people, due to laziness or bad luck, do not have any rightful claims to any property in the world. The rest of us, who do have rightful claims to property, are therefor justified in choosing to voluntarily share our wealth only with those folks who can prove to us that their poverty is due to bad luck, not their laziness. We deserve our wealth, and can therefor share it or not with the poor as we see fit.
This view has merit. The traditional justification for property ownership in Western thought is the labor theory of property. Those who earned their wealth through their own efforts deserve to keep what they earned. People who have worked and received wages, or self-employment income, or who receive investment return on their savings from their wages or self-employment income, rightfully deserve every penny of their money.
But much of the wealth of our society was not earned by living people. Much of the wealth of our society is due to people claiming rights to the products of nature, such as land, water, air, and minerals, that no one produced through their efforts. Much of the wealth of our society is based on the luck of inheritance. And much of the wealth of our society is the creation of society itself, through laws that create wholly fictional forms of property such as corporations. There is no justification for the private control of any of these forms of property without full compensation to the public. Created by none, land and natural resources should be the equal property of all. A society is not free if the living must obey the commands of the dead through instruments such as wills and trusts. And when society creates corporations for private benefit, like any rational entity it should charge as much for the service as it can get. The private appropriation of these forms of wealth is not earned or deserved, it is theft from society.
Which brings us back to those "on welfare". Welfare recipients are not receiving charity from the more deserving members of society. Rather, what they are receiving is part of the dividend that all citizens should receive as equal members of a wealthy society. Society has no right to wag its finger at them and tell them to conform to certain rules if they want their income. A basic income is their right as a citizen, as it the right of all of us as citizens. Part of the reason that means-tested welfare programs breed resentment among the working and middle classes is a rational feeling of being left out: We are all citizens, and we all deserve our equal share of society’s bounty.
A basic income for all, as a right of each citizen, would eliminate the humiliating derogation of the poor as they apply for aid, it would shrink the bureaucracies that manage their lives, it would eliminate the disincentives to individuals raising themselves out of poverty, it would allow mothers to stay home with nursing children, it would eliminate the resentment of the working and middle classes, and it would give the poor a stake in society and a stake in the future. A just society would not scrutinize the poor to determine which are deserving of the alms they receive. A just society would ensure that all citizens receive their equal share of the wealth created by society.
Tuesday, June 15, 2004
What Good is the Estate Tax?
Via Matt, Jane Galt states:
I attended a demographically similar institution somewhat to the north, and while my girlhood memories include recollections of some really repulsive conspicuous consumption, I'm afraid that my classmates offer one of the best cases I've seen for repealing the estate tax. To wit: none of their families seem to have paid any. Since the parents of children in New York City private schools are, without a doubt, the group upon which such a tax should fall, if it falls on anyone, this rather begs the question of which less tax-worthy groups are actually shouldering the burden.
There's also the fact that the estate tax may actually cost the treasury money, by giving parents such a strong incentive to transfer assets to children (who often get taxed at lower rates); and quite certainly costs the economy a great deal of money by a) spawning an entire tax-planning industry, full of people who would otherwise be productively employed b) causing people to shift resources to less valuable (but tax-preferred) uses and c) reducing the incentive of older, experienced workers to work beyond the point where they have accumulated enough assets to live out the remainder of their lives comfortably. (No, I'm sure Warren Buffet wouldn't stop working even if they took it all away. But what about the guy who owns your local convenience store?)
But really, the best argument is the rich, because they don't pay the damn thing. Only half the estate tax revenues come from that 1/10th of 1% who are really fabulously wealthy. The rest comes from schmoes who were careful--and too stupid to pay a planner, or keep their wealth in liquid assets. Is that really the sort of thing we want to tax at 55%?
A major hole in Jane Galt's claims here is that she is failing to acknowledge the ability of the estate tax to achieve public goals without raising much government revenue. Specifically, the primary legal method for the rich to avoid estate tax liability is through the formation of charitable trusts.
Many on the Right claim that welfare spending is not needed so much because America's rich are the most generous in the world in terms of charitable donations. This may be true, I do not have figures, but it does not acknowledge that much, if not most , of this generosity is coerced through the tax code.
An example my Estates and Gift Taxation professor shared with us in a lecture was how Jackie O passed about 100 million to her kids using an upside-down charitable remainder trust. The trust was designed so that the trustees (John Jr. and Caroline) would designate each year which 501(c)3 charities received the income of the trust for 30 years. After that, the principle was to be returned to the kids. The tax the estate owed was for the present value of 100 million in 30 years, which was determined to be about 3 million. So Jackie O passed 100 million to her heirs by only paying about 1.5 million in taxes.
But if the estate tax were repealed, is 1.5 million all that the public would lose? No. More important, with no estate tax, the public would lose the income on 100 million for 30 years going to public charities. Public charities in the U.S. do a LOT of work for the poor that is taken care of in other rich countries by the government. When those funds dry up, the need for government spending will increase dramatically.
Now, yes, I want to close the loopholes and collect virtually a 100% estate tax. But that is because I think that public spending should be directed by living voters, not dead rich people. Still, I acknowledge that charitable foundations do a lot of good work, and to suggest that the only thing the public loses by repealing the estate is the few funds the government receives under the current system is wrong.
Tuesday, June 01, 2004
Accusations of Anti-Semitism Prove Accuser is Anti-Semite
So, Mike S. Adams literally phones in this weeks column for TownHall.Com, printing a transcript of an interview he gave to David Horowitz about his new book condemning politically correct speech repression on American college campuses. Lots of fun adventures in logic ensue, such as when Adams sandwiches a call to use free speech to expose leftist professors in between an endorsement of Horowitz's "academic Bill of Rights" and the need for litigation. I will leave it to real right libertarians such as Jesse Walker to dissect this intriguing defense of free speech.
Then, after Adams accuses Cornel West of anti-Semitism in a guilt-by-association argument (The questions he wishes to ask West are "Are you an anti-Semite? If not, why do so many of your friends seem to hate Jews?"), we get this exchange:
FP: Indeed, and why do so many leftists hate Jews? Anti-Semitism has clearly become the new call of the Left and it explains why leftists and Islamists now have so much in common. Why do you think anti-Semitism is so chic now amongst leftists - especially on campus?
Adams: That is the toughest question you could have possibly asked. I know that anti-Semitism is more chic than ever among academics but I will never be able to explain its persistence throughout time, not just in academia but in the world at large.
The surest sign that anti-Semitism is on the rise is the recent increase in accusations of anti-Semitism by the university Left. The week that Mel Gibson's "Passion" debuted, our university hosted a talk via satellite by Minister Louis Farrakhan. Local members of the Nation of Islam were on campus raising funds for slavery reparations. That week there was plenty of talk about anti-Semitism on campus. None of it was directed towards Farrakhan. It was all directed towards Gibson.
To repeat: The surest sign that anti-Semitism is on the rise is the recent increase in accusations of anti-Semitism by the university Left.
Obviously. Why would someone even make an accusation of anti-Semitism unless he was one himself? Adams needs to investigate those anti-Semites at the Anti-Defamation league. Those Nazis are ALWAYS accusing people of anti-Semitism!
Wait a minute, Mr. Adams! Haven't YOU been accusing people of anti-Semitism? Shave your head, I know there's a swastika tattooed under there.
As for why people fighting anti-Semitism would direct more energy at Gibson then Farrakhan, here's some homework: Go to your nearest mall and ask ten random people to identify: A. Mel Gibson, and B. Luis Farrakhan. Return with your answer, and then we will discuss how to allocate our resources in the fight against racism.
You know, whenever I attend conferences of academic leftists, I am struck by the disproportionate absence of Jews. Next conservative talking point: Anti-Semitic gay-bashers have taken over Hollywood!
Friday, February 06, 2004
Corporate tax debate
The following is an editted version of a debate in the comments to this post at Crooked Timber:
Can we use this to discuss the morality of corporate taxes as well? Many on the right claim corporate taxes unjustly put a second tax on income that would otherwise only be taxed once, and we are therefore ““punishing”” a choice of business entity. But things like limited liability show that the corporate is not a tax on income, but a fee for a government-granted priviledge - and the fact that you can conduct business without the corporate form, but people choose to do so, shows that the benefits of corporate existence are worth the price.
-Decnavda
When ““corporate taxes”” are levied, what is not understood is that they are in fact taxes on individuals. The taxes are paid for by the owners of the company through lost profits, the workers of the company through decreases wages, and the consumers of said companies’’ products and services through price increases. Taxes are always levied on individuals. There is no way to be taxes and have that tax not affect each of us in the form of lost assets or increased cost of living. The complaint is that the corporation has no soul to damn or pants to kick, but it also has no individuality to tax, any and all added costs (taxes included) trickle down to we the people.
-limberwulf
As for your response to the tax issue, you are committing serious zero-sum thinking. Corporations are created by government and individuals because the individuals can produce more ecconomically with the corp than they can without it. The question then arrises, how is this extra sum to be split among the creators? I am simply suggesting that the community/government act like any other self-interested participant and get as much of the extra as it can. If you really believe that the government contributes no extra benefit by passing laws that create corporations, then please explain why people choose to do business in the corporate form when it costs them money to do so in the form of corporate taxes, and it is possible to conduct all of the same business activities without the corporate shell.
-decnavda
To clarify my point:
Limberwulf wrote: ““When ““corporate taxes”” are levied, what is not understood is that they are in fact taxes on individuals.””
What I am suggesting is that corporate taxes are not paid for by individuals, but they are paid out of the extra wealth created by the existence of the corporation. I suggest this is obviously true, for otherwise no one would bother doing business in the form of a corporation. Is there a flaw in this argument?
-decnavda
decnavda,
I see two issues in your argument. One is the assumption that the corporate model is being chosen only for the sake of increased profit. I have seen many corporate models (worked for some of them) that could have made more money as a sole proprietership, but chose the corporate model as a rick management move. As it turned out, this company was indeed hit with a lawsuit that bankrupted the company, but, fortunately, did not take the personal assets of the founder. He was able to start over and is currently doing well.
The second issue is that the corporate model actually has CHEAPER taxes than partnerships and sole proprietorships when all monies are not distributed as income. Before I knew this, I had a business of my own. I set aside a portion of business profits to put into capital growth, but had not used all of it for business equipment at the end of the year. The tax rate on that money was equal to my personal income tax, around 25% at that time. Equivalent corporate tax on those funds would have been 15% at the time. Because of the sum of money I had set aside, 15% tax on total profits would have been a savings even though it would have double taxed the profits going to payroll.
So, yes, perhaps a greater capital growth can be had in a corporate model, but the taxation of this money, particularly the sums that end up being double taxed, are still a decrease in the profits of the corporation. Those profits would have otherwise gone to: a) business growth and capital investment, a benefit to the economy. b) employee payroll, a benefit to the economy through job creation and/or increased disposable income. c) increased payout to shareholders, a benefit to the economy through increased disposable income. d) decreased consumer prices, and benefit to the economy by providing a good or service at a lower rate, allowing an effective increase in disposable income. The fact that the corporate model may allow increased profitability does not mean the monies taken by the government could not have been better spent by individuals. All taxes are a tax on individuals, there is no way to escape this. Money doesnt just appear, it is created through the efforts of people.
-limberwulf
limberwulf-
1. Risk managemant IS a profitability issue.
2. The service of risk management through limited liability obviously has value to those who use it. Why should the government not charge for this service in proportion to the amount of investment protected from risk?
3. Limited liability does NOT explain the continued dominance of the ecconomy by corporations in the past decade. Thanks to LLCs (Limited Liability Corporations), which as taxed as parternships, limited liability can now be had for free. Those who chose C corps do so to take advantage of the other benefits of corporate existence, presumeably because these increase profitability.
4. Your point about retained corporate earnings being taxed at a lower rate than parternship profits passed through to rich partners is, I admit, a good theoretical answer to my question about why anyone would choose to pay corporate taxes if the corporate form does not increase profits. This suggests an empirical test of my hypothosis: Would C corporations cease to dominate the ecconomy if the corporate income tax was higher than the individual income tax? I believe tha answer is no, just as giving out limited liability for free did not end corporate dominance, but I am willing to be proved wrong.
5. Your arguments about the social goods that would result from leaving the profits with the corporation rather than taxing them are empirical utilitarian arguments that I simply disagree with for reasons far beyon this thread. At any rate, these are arguments for a LOW corp income tax, but not for NO corp income tax. Presumeably, for example, the government could do many good things with the revenue from a 1% corp income tax without interfering with any of the positive externalities you mention. Beyond that 1%, we are just negotiating.
6. ““Money doesnt just appear, it is created through the efforts of people.””
Oh, please! I’’M the one making the positive sum argument here. Wealth is created through the efforts of individuals AND the community (government). Assume PI is the production of individuals and C is the existence of corporations. I’’m saying:
PI=x.
PI+C>x.
The > is created by the C, which is created by both the government and the individuals, and therefore the both the government and the individuals should split the >.
-decnavda
decnavda,
do you have a formula for determining the quantity of the ““>”” in your formula? If I were to agree with the concept of splitting that between the government and the rest of us (which I dont for reasons that go beyond this post) there would still need to be a quantity defined that could be split. Does 1% split it? How about 10%, or 25%? I understand your point that we are simply negotiating, but to do so we need to know what we are negotiating over.
Risk management is indeed a profitability issue, but it is indefinable in exact terms. It is much like the value of insurance. My insurance does me no good at all if I never have to use it. It becomes a complete waste of money. However, if I do have to use it, its value is enormous. How do you quantify risk management into exact taxable dollars?
LLC’’s do not issue stock for public ownership. The dominance of C corporations as far as I know is directly tied to their ability to raise very large sums of capital from a far broader base of people to accomplish goals of production that require immense startup sums. I currently work for an LLC. We can get investors, but we can not issue stock on public markets. There may be LLC’’s that can, I have not fully researched this.
-limberwulf
limberwulf -
1. ““How do you quantify risk management into exact taxable dollars?””
Beats me, but people in the insurance industry do it all the time. This may sound like a cop-out on my part, but it is not. If you were to ask me how I could possibly build an internal combustion engine, I would say that I would hire one of those people who build those that I see all over the roads. The expersis to do this rather precisely is out there for hire.
2. Personally, I would set the percentage the same way that Scholastic decides how much to charge for a Harry Potter novel. Recognizing that demand goes down as price goes up, charge what ever will bring in the most revenue. Again, assuming my theory that corporate taxes are paid out of increased revenue due to corporate existence is correct, this rate will represent the best ““deal”” the government can get.
A reasonable conservative position would be to set the rate at what will maximize social goods, which means public revenues plus the net of positive externalities over negative externalities. I would still disagree with this though, because I do not think the public should be any more willing ot count the birds in the bushes any more than corporate investors do.
3. ““The dominance of C corporations as far as I know is directly tied to their ability to raise very large sums of capital from a far broader base of people to accomplish goals of production that require immense startup sums.”” Bingo! Now you’’re giving me support for my position. The C corps DO provide economic advantages that are confered by the government granting corporate existence. Thanks.
-decnavda
Friday, January 16, 2004
Fictional Foundations
The three primary means of justifying the foundations of political society each have great attractions. Natural Rights appeal to our intuition that morality should be absolute, and not situational or ad hoc. Utilitarianism seems demanded by the most plausible spiritual doctrines. The Golden Rule is compelling in its simplicity, universality of application, and correspondence with our intuitions.
But they all fail because they are each based on fiction. Natural Rights are based on the fiction that rights exist in nature. Utilitarianism is based on the fiction that all life is interconnected, or that the universe itself has wants or needs. The Social Contract is based on the fiction that society has agreed to a contract.
Rather than fictional foundations for our theories, we want factual, or at least truthful, foundations. To do this, we must first determine what the foundation of political society actually is. Once we know what it is, then we can determine what principles ought to govern it.
The Social Contract
The idea behind the social contract is that all interactions between humans are governed by implicit agreement. The proper moral way to treat other people is the way they would rationally agree to be treated, and the moral way to structure society is the way the members of that society would agree to be ruled. Morality and the good society are based on reciprocation between individuals and between citizens and society. In the realm of personal morality, this takes form as the Golden Rule, expressed by Jesus as, “Do unto others as you would have them do unto you,” by Confucius as, “Treat other people the way you yourself would want to be treated,” and by Immanuel Kant as the Categorical Imperative, “Always treat other persons as ends, and never as means. / Always act in a manner that you would want to be the universal rule in similar circumstances.”
In the realm of political philosophy, this would appear at first, at least to citizens of the 21st century, to require democracy. After all, is not the easiest way to find out how people would want to be governed simply to ask them? But it turns out that doing what people actually want is less important than the concept of reciprocity. The advantages of rulership are justified by the benefits conferred upon the ruled. Thomas Hobbes, credited in the West for originating the concept of the social contract, used it justify an authoritarian state: The conditions of anarchy and chaos are so terrible that rulers need to be given the absolute power necessary to impose order. But the concept of basing society on reciprocal obligations is much older. In addition to the idea of divine (natural) right, feudal society was also justified by oath, obligation, and reciprocity. The lord agreed to fight for the king, and the king granted land to the lord. The serfs agreed to work for the lord, and the lord agreed to protect the serfs. (From, presumably, the lords of other kings who might take the land and make the serfs work for them instead.) The social theories of Confucius also appear based on such reciprocity. Wives were to obey their husbands, and in return husbands were to provide for their wives. Men obeyed the emperor, and in return the emperor protected men and their families.
(Without democracies, it is difficult to tell the difference between the Mafia and a “social contract” government: They both earn their way from a protection racket.)
It should also be noted that democracy can be justified by either natural rights or utilitarianism. Some might argue that citizens have a natural right to have their opinions count equally in the governance of their society. A utilitarian can argue for democracy based on the limited knowledge of the rulers. The goal of the utilitarian is to do the greatest good for the greatest number. An elite ruling class, no matter how well educated, may be too detached from the general population and too biased by their own interests to make decisions that will best increase the happiness of all. If individuals have the most accurate knowledge of what will make them happy, the best way to find out what will make the majority happy is to ask them. Or if all rulers can be counted on to make decisions that favor their own best interests first, then the best way to make sure that the interests of the greatest number will be served is to allow the greatest number to rule.
So the social contract does not lead automatically to democracy, and democracy can be justified without reference to the social contract. Still, the intuitions of 21st century citizens are more logical than cultural. The rise of explicit social contract theory coincided with the rise of democracy, most social contract theorists have been democrats, and the language of democracy is enmeshed with the language of the social contract, such as in, “...governments are instituted among men, deriving their just power from the consent of the governed,” “...of the people, by the people, and for the people,” and the “New Deal.” Democracy and social contract theory may not be necessary for one another, but they are a well-matched pair.
Social contract theorists, beginning with Hobbes, have justified the social contract with reference to the “state of nature”. Roughly, the state of nature is the state of being that humans are in, or would be in, without laws or civilization. Rawls, who rejected the state of nature, called it the “no agreement point”. Hobbes, who originate the concept, thought it would be a war of all against all, and life would be, “nasty, brutish, and short”. Later thinker were more optimistic about how humans would behave without coercive authority. Still, the state of nature was used to explain why citizens were obligated to follow the dictates of their society. Citizens formed civil society in order to avoid the evils of a state of nature, however bad those evils might be.
The latest philosopher to join the cannon of social contract theorists is John Rawls. Unlike many of the earlier theorists, Rawls seems to take the existence of civil society as a given. Although Rawls is dismissive of Hobbes early in his now classic work, A Theory of Justice(ToJ), to the extent that he actually spends time justifying the need for laws and government, he seems to accept Hobbes’ account, as modified by modern game theory. Not only does coercive authority prevent murder, theft, tax evasion, insider trading, and rape, but the lack of coercive authority actually encourages such antisocial behaviors. Without coercive enforcement of prohibitions against antisocial behavior, individuals may assume that their neighbors are not paying their taxes. Suspecting that this probably the case, it seems unfair to be sucker who actually does pay taxes, because the payer is bearing the whole cost of benefits received by all, including the neighbor who refuses to pay. In fact, the payer likely has to pay more to shoulder the burden of those who do not pay. Worse, the reasonableness of this line of thinking means that even neighbors who are not antisocial, but are merely rationally concerned with fairness to themselves, will likely not pay either, leading to an even heavier burden on the few suckers who do pay, and making it even less reasonable to be one of those suckers. The introduction of coercive authority changes this equation. Although their may still be a few people who do not pay and get away with it, the fear of getting caught will deter even most antisocial types from not paying. Since even most antisocial types will pay, those who are not antisocial but merely rationally concerned with fairness to themselves will not think of themselves as suckers for paying and will therefor not be discouraged from paying.
Rawls’ main concern was with providing a method and rules for how draw up blueprints for the institutions of a just society. He called his theory “Justice as Fairness,” and described a moral way to structure the basic institutions of society according to the dictates of fairness. His epistemology of morality was called “reflexive equilibrium.” To summarize, you take a general look at the various things you believe to be morally true. You then develop basic principles that support as many of your intuitions as possible. You then look at situations where the principles you developed lead to conclusions counter to your intuitions. You then make a choice about whether to change your conclusions to fit your principles, or to change your principles to support conclusions you can live with. Changing your conclusions will probably require you to update your principles in light of the new set of conclusions. Changing your principles will probably require you to update your conclusions in light of the new principles. As you move back and forth between your principles and conclusions, each new round of updates should (hopefully) require fewer and more narrow alterations as you move from supporting your deepest convictions and outlining your basic principles to fine-tuning the syllogistic relationship between them. The goal is to eventually reach a point where few or no further alterations are required on either side. It is at this point of logical coherence that your moral philosophy is said to have reached reflexive equilibrium.
Rawls’ own reflexive equilibrium lead him (at the time ToJ was published) to advocate for a society that would fulfill the Immanuel Kant’s Categorical Imperative by way of an elaborate thought experiment. He proposed a new “no agreement point” called the “original position”. A better description might be the “pre-agreement point”. Unlike the state of nature, which is where people end up if they fail to create a social contract, the original position exists for the sole purpose of negotiating the contract. To enter the original position, members of society must step outside of themselves, their society, and their time. They are draped with a veil of ignorance that conceals from them who they are. They not only do not know their names, they do not know their social position, wealth, talents, or interests. They do not even know when they will be born. In fact, they are not even actual people. Rawls does not envision the deliberators to be real people with limited life spans, but rather they are out-of-time representative heads of continuing families. Nor are they allowed, at least at the first stage, specific knowledge about what kind of social positions exist, or can exist, in their society. Rather, they are given general knowledge about human nature, the sorts of things that people desire, what the world is like, and how societies generally tend to develop. The goal at this first stage is not to actually design their society, but to agree on the principles that will guide them when they do create their society. Rawls then proceeds to argue for the principles that he believes would be chosen by the deliberators in the original position. He believes that the deliberators would agree on two principles of justice. Essentially, these are Liberty and Equality, in that order. As is typical for philosophers, what he means by these principles and their order can be fairly complex, and the specifics will be dissected and weighed later in this treatise.
What is most relevant at this stage of the inquiry is not the desirability or workability of particular conceptions of society, but the legitimacy of their foundations. And it can not be denied that the case for the existence of a binding social contract is exceptionally weak.
Humans never existed in a state of nature. Multi-family tribes with hierarchical chains of authority that violently enforce social norms that vary from tribe to tribe can be found among gorillas, chimpanzees, bonobos, and other simian primates. They likely existed among our ancestors long before our ancestors could reasonably be called “human”. Nor is their any empirical evidence that would support the possibility of humans ever reverting to life in a state in which humans have never before existed.
The original position never existed. Rawls never claimed it did, it was entirely a thought experiment. Nor is it an honest experiment. Rather, through reflexive equilibrium, the parameters of the experiment are intentionally designed to produced the result desired. Consider Rawls viewing the deliberators not as actual people, but as out-of-time representative heads of continuing families. This is because Rawls has deep intuitions shared by most for the need for inter-generational fairness in savings rates. But when he can not figure out why folks in the original position would adopt such a principle of inter-generational fairness, Rawls abandons basing logical argument on empirically verifiable factual assertions, he imagines avatars of immortal spirits of collectives who would reach the conclusion for which he has no other support.
Most importantly, for a contract to be binding, it must have been freely agreed to. No such contract has ever been agreed to by all members of a society. When did you agree to be bound by the rules of society? Was it in writing? Many of the founding documents of the United States are written as if they are binding contracts. But they are not. All of these signers of the documents are now dead. Are we the living bound by the agreements of our ancestors? The male ones? Even if none of these people were not our ancestors specifically, but rather the elected representatives of our ancestors? Even if our specific ancestors could not vote in these elections because he owned no land? Or was held as a slave by the people making agreements with each other?
As a moral system, the Golden Rule has a lot going for it. It suits our intuitions about what is right and what it wrong without being inflexible or overly demanding. We want others to respect our rights, but we can be forgiving in emergency situations that might compel us to violate their rights. We want others to not harm us, and to do us courtesies and small favors from time to time and maybe more if we are in dire circumstances, but we do not expect others to spend all their time helping us, nor do we expect the more industrious to give us everything they do not require for subsidence. As a foundation for a political system, the Social Contract is also very attractive. The language of Social Contract is lift directly out of a market economy and infuses the day to day talk of democracy. Social Contract also seems to intuitively provide a greater basis for peaceful resolution of conflict between adherents. If you believe property rights are naturally communal, and I believe my right to my private property is natural, and we fail to convince each other otherwise, what else can we do but fight to defend our rights? If you are convinced that communism would make the world happiest, and I am convinced capitalism would make the world happiest, and we fail to convince each other otherwise, violent conflict between us seems not only justified, but demanded by utilitarianism. Yet if you believe that communism would be the best way for people to treat each other and agree to live, and I believe the same about capitalism, the Golden Rule and the idea of society as an agreement would seem to compel us to negotiate a compromise.
Yet even if the morality of an action is dependent on its actual or expected consequences, the truth of a belief is independent of its consequences. Skeptics should ask social contract theorists why they should be bound by contracts to which they did not agree. If the social contract theorist claims there was an agreement, but it was not in writing, the skeptics should point out that such contracts are not worth the paper on which they are written.
Utilitarianism
From the skeptical standpoint I am taking in this treatise, the goal of most utilitarians is laudable. They are attempting to deduce (create?) morality from the empirically observable facts of reality, without reference to God or any spiritual realm. The fact of primary importance to utilitarians is that all animals like pleasure and happiness and dislike pain and suffering. Thus, we should act so as to increase pleasure and happiness in the world and decrease pain and suffering.
Simple, no?
Too simple. The problems that arise can be grouped into three broad categories: Counterintuitive consequences, practical difficulties performing the required calculus, and basic theory.
Thinking up counterintuitive consequences of utilitarianism can be fun. Anyone can do it - why don’t you give it a try? Be careful though: Most of the example people come up with on their first few tries are easily dismissed by utilitarians as emergency situations were it makes sense that our genes or society would program us with a different intuitive answer. A terrorist with a hostage is about to throw a powerful bomb into a large crowd. If necessary, should the police shoot through the hostage to stop the terrorist? The utilitarian would say yes. For those bothered by the thought of sacrificing one innocent person to save others, the utilitarian can point out that this is a rare emergency situation. True, the evolution of our species or our society may have drilled into our heads the idea that innocent people may never be killed for any reason. Given the rarity of the need to kill innocent people, this intuition is probably, in general, a good one for our society and our species. This does not, however, change the fact that when the rare situation does arise, our otherwise useful emotional reaction may contradict what a more reasoned analysis of the situation would require us to do.
Contemplating less rare situations can provide even more troubling counterintuitive consequences. Consider the case of Peter Singer, the most prominent living utilitarian philosopher. In order to relieve the suffering of the severely disabled and their parents, he has advocated allowing the parents of severely disabled infants to have their children humanely euthanized. For this he has become public enemy number one to the activist disabled community, many of whom quite literally view him as being as morally depraved as Hitler. However, Singer is a hero to many in the animal rights movement for his brilliant defense of vegetarianism due to the utter cruelty of modern factory farming methods. So here you have the most prominent living utilitarian philosopher’s morality: Be kind to chickens, and kill disabled babies.
The practical, day-to-day consequences of utilitarianism can also be daunting. Thinking about going to see Lord of the Rings this weekend? Well, sure you would probably enjoy that a lot, but would your enjoyment of this movie really be enough to balance out the blindness that could have been prevented had you forgone the movie and sent the $10 it would have cost you to a charity that distributes vitamin A to children in underdeveloped nations to prevent blindness? And don’t think you can just spend those three hours you would have been watching the movie just lying around the house. There is no way the suffering you will endure pulling overtime at your cushy OSHA protected workplace will balance out the blindness you will prevent sending your time-and-a-half wages to the afore-mentioned charity. In fact, just forget ever going to any movie or working less than 70 hour weeks. There is no way your suffering will ever balance out all the suffering that will be prevented by sending all of your wages above what you need to survive to keep working to charities that help famine stricken underdeveloped nations.
Or consider a practical dilemma utilitarianism poses for Singer himself. Some of the disability activists that he has upset have claimed that his ideas contribute to the oppression of the disabled. Advocating the euthanization of severely disabled infants on utilitarian grounds spreads the message that the world would be better if these people never existed. If the able-bodied believe the disabled should not exist, this can legitimize ignoring, discriminating against, or outright hostility toward the disabled. And it is undeniable that his ideas have caused great distress among many disabled people themselves. Further, his ideas about infant euthanization have not been adopted, and I doubt any reasonable person believes they any chance of being adopted in any foreseeable future. Therefore, his promotion of this idea has caused suffering in disabled people, has a realistic possibility of indirectly causing greater suffering among disabled people by legitimizing discrimination against them, and does not stand any realistic chance of ever relieving any suffering through implementation. Logically, none of this bears on the rightness or wrongness of the idea of euthanizing severely disabled infants. But if Singer’s utilitarian philosophy is correct, it would seem the moral thing for him to do would be to relieve suffering by no longer promoting this idea, and in fact issuing an unconditional retraction. (Without disclosing the real, moral, motive for the retraction, as that would imply, correctly, that he still believed his idea was right, and the suffering would continue.)
The difficulties in performing the required calculus for utilitarianism are legion, and in my view insurmountable. Consider two questions. First, it is even possible to compare different people’s pleasure or suffering? And, should we count all types of pleasure or suffering? Now consider the following argument: Seeing homosexuals together and even thinking about homosexuality makes the vast majority of straight people extremely uncomfortable. The suffering of any individual homosexual at having to remain closeted is undoubtably much greater than the suffering experienced by any individual homophobe upon being exposed to out homosexuals. However, if we assume that the most reliable estimates are that at most 5% to 6% of the population is gay or lesbian, then the minor suffering of the great number of straights at being exposed to out homosexuals adds up to more than the great suffering of the tiny number of homosexuals. Therefore, to relieve the greatest amount of suffering, we should pursue policies designed to force gays and lesbians to remain in the closet.
How is a utilitarian to evaluate this argument? Certainly it would difficult to attack the factual premises. Most people would agree that the suffering of a homophobe at being exposed to homosexuality is real, that this suffering is less than the suffering of a homosexual who must remain closeted, and that there are many times more homophobes than there are homosexuals. From a utilitarian standpoint, this argument is structurally and factually sound. It would seem that the only avenue of attack open to a pro-gay rights utilitarian would be to attack the math. The suffering of the homophobes might be less than anti-gay rights utilitarian supposes, or the suffering of homosexuals might be more intense, or there might be greater ratio of gays to homophobes.
While the ratio of gays to homophobes might be subject to reasonable measurement using social science methodology, how can you possibly measure the various suffering? How do you average the suffering of someone uncomfortable around a person he thinks of as a pervert, a person who will be embarrassed fi their friends discover their brother is gay, and a deeply religious mother who cries because her gay son is going to hell? How do you average the suffering of homosexuals who lives in denial, those who live in hiding, and those who are discovered and shunned, ridiculed, or beaten? And how do you weigh these averages, given the ratios of the two groups?
It is simply not possible.
One possible solution is to declare that some pleasures or suffering should not count, because they are “wrong”. But how? The whole point of utilitarianism is to determine what is right or wrong. If these pleasures or pains are real, declaring that they should not count prioritizes some other moral system above utilitarianism, such as natural rights, or some sort of Aristotelian perfectionism. And if you do count “bad” pleasures or pain, where do you stop? Should the morality of a gang rape be determined by comparing the pleasures of the many rapists with pain of the one victim? And even if so, again, how is this comparison to be made?
Another possible solution is “preference” utilitarianism. In preference utilitarianism, what is compared is not pleasures and pain themselves as brain experiences, but rather you try to maximize the aggregate satisfaction of the preferences of every individual. Preference utilitarianism does indeed solve the problem of how to do the “calculus”, because preferences can be precisely measured. Individuals can rank their own preferences in order, and the intensity of desire for fulfillment of preferences between individuals can be measured through the market, by comparing how much they are willing to spend to fulfill their desires. Preference utilitarianism is popular with economists.
But why preferences? The mathematical convenience of preference utilitarianism does not prove whether or not it will make the world a better or more enjoyable place. People will often desire things intensely that are clearly bad for them, as the addict desires his drug. Paranoid schizophrenics have suffering that can be relieved, but satisfying their preferences is indulging in nightmares.
Preference utilitarianism does virtually nothing for those who cannot adequately communicate their preferences. An accident that leaves your mind untouched but makes you a quadriplegic without a voice would place you outside the concern of preference utilitarianism. Damage to the specific area of your brain responsible for language can leave the rest of your mind and body fine, but your preferences still uncountable. Helen Keller may have had a fine mind, suffering, happiness, and desires before learning to sign “water”, but preference utilitarianism would not have counted her. The preferences of babies cannot be counted, only those of their caretakers. Animal rights is out. Koko the Gorilla may be able to adequately indicate her preferences, but how do we take surveys of our primate cousins who have not learned sign language? How do we determine, let alone measure the intensity of, the desires of dogs, cattle, chickens, and frogs?
And the market does not compare the intensity of desires between individuals accurately, because it weighs the desires of the wealthy more than the poor. If a starving homeless man gets into a bidding war for a loaf of bread against Bill Gates, who wants to use it as a seat cushion, Gates is likely to win, and certainly can, even if his desire is far less than that of the starving homeless guy.
But the worst theoretic problem with utilitarianism is the way it conflates individuals. As stated by Rawls, utilitarianism ignores the factual separateness of persons.
Consider Susan Susan is single, believes in utilitarianism and is considered by most people to be very attractive, but she is by nature a loner and would rather spend her time painting landscapes or listening to music than having sex, which she has always found to be pleasant enough, but not what she would rather be spending her time doing. The thought occurs to her: Should I spend my nights and weekends offering myself sexually to many different men?
How should Susan evaluate this? Reasonably, she could schedule three men a night after work for an hour each, and at least ten for an hour each on Saturdays and Sundays. This could provide potentially seventy men with biweekly sex. Since she finds sex pleasant enough, and does not desire a significant other who might be upset by the activity, the primary cost to general happiness will be her opportunity cost in time she could have spent painting landscapes and listening to music. On the plus side, the men will not only enjoy the sex a lot, but the biweekly sex might improve their general happiness with life, especially if Susan confines herself to single, working class loners who might not have other sexual outlets available. Confining herself to these men would also prevent unhappiness to potentially jealous partners of the men who might discover the biweekly sessions.
To prevent the possibility these men might view her as more than a sex object and get jealous of the other men, she could charge a nominal fee, enough so that they do not think of her as anything other than a sex object for hire, but not so much as to take away any of the men’s enjoyment from the encounters. Best of all, Susan could then pay any expenses related to the sex and send all of the profits to a charity that distributes vitamin A to children in underdeveloped nations.
Of course, once we throw the charity back into the mix, then it is likely that Susan should abandon this plan and spend her time doing whatever will raise the most money for charity. But again, this could turn out to be prostituting herself to wealthy men for the highest possible price.
The reasons that Susan’s dilemma are counterintuitive are good. This treatise assumes an atheistic, materialist universe in which Susan is a separate, autonomous decision maker whose decision making organ, her brain, is physically connected to a body that provides her brain with sense information and over which her brain has sole voluntary control. Why should the potential sexual satisfaction of seventy people separate from her, or even the potential blindness of hundreds of poor children, be a determining factor in her decision as to whom she should make her body sexually available? People are factually separate, and it is not clear how the pain or pleasure of others puts moral imperatives on others.
Utilitarianism can be saved by spirituality. Pantheists and those who have achieved Oneness with the cosmos should certainly prioritize the overall happiness of the universe, or at least that portion of the universe they can realistically affect, above their own personal happiness. Indeed pantheists can use utilitarianism to refute a primary atheistic argument against pantheism. Atheists sometimes charge that pantheism is nothing more than semantics: Pantheism simply redefines the universe as God. There is no spiritual claim of substance being advanced. But if the pantheists are right in their intuition that the fabric of the universe is woven with spiritual thread, then pantheism justifies a moral code that atheism cannot. For if the universe is God, and we are all One with, and part of, God, then prioritizing the overall happiness of the universe would seem imperative.
But not in an atheistic universe, where the universe exists, but the fabric is not woven with any spiritual connections or meanings. The atheistic universe is indifferent to the individual. The old atheist parable is: A man says to the universe, “Sir, I exist!” And the universe replies, “That fact does not instill in me a sense of obligation.” But the utilitarian wants the reverse of the situation to carry moral weight. The utilitarian wishes to tell the individual, “Sir, the universe exists!” If that person is an atheist, they should reply, “That fact does not instill in me a sense of obligation.”
Personally, I find myself gazing in awe at the mysteries of the universe. Primary among these are the mystery of the existence of the universe and the mystery of consciousness. I also note the absence of evidence of the absence of God. I therefore call myself an agnostic, not an atheist. A serious challenge that atheists pose to agnostics is to point to any theistic belief that is not infinitely improbable. This challenges eliminates all organized religions. Realistically, the myths of the ancients are as likely true as the fantasy of J. R. R. Tolkien or the science fiction of Jules Verne and H. G. Wells. But the idea of a conscious or semi-conscious universe that longs for life and fulfillment is alluring, and is as likely an explanation for the existence of humanity as any other I have ever heard. I am convinced that if there is any truth to theism, it lies in or near pantheism.
But the goal of this treatise is to build a political philosophy on the foundations of empirically undeniable facts, and I can empirically verify no spiritual essence in the universe. Mysteries, even profound and enduring, are not evidence. Nor is absence of evidence. This treatise therefore takes an atheistic starting point. As such, we must reject pantheism, and therefor utilitarianism as well.
Thursday, January 08, 2004
The stodgy Conservatives of the 18th Century
Terence Jeffrey at Townhall takes up the romantic cause of the civilized, gentlemanly. landed aristocracy who are besieged by the rowdy, uncouth bourgeois corporate capitalists.
The death tax is a one-way ticket for private property. It drives it away from individuals and families and into the hands of big government and large, publicly traded companies. By opposing repeal of the death tax, Dean puts the interests of big business over family business.
I could slam Jeffrey here for once again bring up the (lie?) urban legend about the estate tax causing family businesses to go under, but why bother? If conservatives want us to believe that a growing market requires dynamic creative distruction and that we should therefor not be concerned with the plight of hard-working people losing their jobs to overseas countries with (no minimum wage?) (no unions?) more effecient production methods, why should I give a damn about pampered rich kids who can not run a business effeciently enough to pay a mortgage on it? I am a capitalist, but I respect those who EARN their money. Mr. Jeffrey respects birthright entitlements.
Oh, and it's not a "death tax". It's a "robbing the corpse" tax.
Bowling for Columbine
Finally saw Bowling for Columbine. A lot more fair than I expected. I agree there are many flaws, but the questions I have for its critics, especially the libertarian ones, are:
1. How can anyone claim that he blamed U.S. military agression (as he sees it) for random gun violence? He brings this idea up mainly in the context of responding to claims that Columbine was caused by video games, lack of prayer in schools, or Marilyn Manson, and then he goes on to suggest bowling as a cause. He also repeatedly points out all of the organized bloodshed caused by Britian and Germany which as failed to lead to our level of random gun violence. I thought his point was that all of these explainations fail.
2. Isn't his whole Canadian sequence a better portrayal of responsible gun enthusiasum than anything the NRA has ever produced?
3. How can you complain about a South Park history of America?
Friday, December 19, 2003
How to get single mothers off of welfare
Marvin Olasky writes in Townhall:
3) President Bush, in Tuesday's ABC interview with Diane Sawyer, voiced support for a constitutional amendment defining marriage as the union of a man and a woman, but such a move is still being portrayed as an entry of religion into politics, rather than a defense of limited government. What's being missed is that strong marriages are our only bulwark against bigger government. Women raising children outside of marriage look to government for help, and a compassionate culture cannot say no.
That's it!!! They should all just marry gay men!!!
Wednesday, December 17, 2003
The Outline So Far
I. The Social Contract
A. The Three Alternatives
1. Natural Rights
2. Utilitarianism
3. The Social Contract
4. Fictional Foundations
B. Is
1. A Just-So Story
2. Present Reality
3. Different Social Contracts
a. Surrender/ Slavery
b. Non-Aggression/ Thievery
c. Alliance/ Partnership
d. Associate (between Slavery and Partner)
e. Tribute/ Extortion (between Surrender/ Slavery and Non-Aggression/ Thievery)
f. Mutual Aid (between Non-Aggression/ Thievery and Alliance/ Partnership)
g. Apprentice
4. The Social Contract Chart
a. Overt vs. Covert
b. Self-Enforcing
(1) Government
(2) Mafia
c. Enforced Recognition
(1) Organizations (Corporations)
(2) RICO
d. Self-Recognizing
(1) Partnerships
(2) Conspiracies
e. Informal
(1) Networks (Friends)
(2) Contacts
f. Individual
(1) Citizen
(2) Outlaw
5. The Organization Chart
a. The Chart
(1) Private vs. Public Benefit
(2) Private vs. Public Control
b. The Organizations
(1) Corporations
(a) Mutual Benefit Organizations
(2) Charities
(3) Utilities
(4) Agencies
6. The Common Law Split
a. Civil Law - Disputes between Partners
b. Criminal Law - War against those who rejected the contract
C. Ought
1. Bracketing Morality
2. Getting to Yes and John Rawls
a. Separate the People from the Problem (The Original Position)
b. Focus on Interests, not Positions (General Knowledge)
c. Generate Options for Mutual Gain (*Rawls Fails*)
d. Insist on Objective Criteria (The Veil of Ignorance)
3. Who is Part of the Contract?
4. The Requirements
a. Universal Advantage
b. Minimalist Application
c. Equal Treatment
(1) Political Liberty
d. Equal Distribution
(1) Equal Opportunity
(2) The Difference Principle
5. Reintroducing Morality
II. Left-Libertarianism
A. The Basics
1. Self Ownership
2. Externalities
a. Private Ownership
b. Public Ownership
(1) Joint Ownership
(2) Equal Ownership
B. Justifications
1. Natural Rights
a. Negative Liberty vs. Positive Liberty
b. People
c. Chattels
d. Land
e. Natural Resources
f. Improvements
g. Intellectual Property
h. Chattels Reconsidered
i. People Reconsidered
j. Income from Labor
k. Corporations
2. Utilitarianism
a. Markets are Good
b. Centralized Control is Bad
c. Extra-Market Transfers
(1) Post- Market Transfers
(2) Pre-Market Transfers
(3) Extra-Market Property
d. Marginal Utility and the Poor
(1) Brad DeLong
e. The Coase Theorum
3. The Social Contract
a. Focus on Citizen vs. Property
(1) Gifts and Inheritances
b. John Rawls
(1) Priority of Liberty and Distributive Justice
(a) Distributive Form Can Impede Liberty
(b) Insufficient Distribution Can Impede Liberty
(2) The Difference Principle Solution to the Paradox of Markets and Egalitarianism of Outcome
c. Part I
(1) Limiting Liberties to Maximize Liberty
(2) The State’s Cut
C. The Blueprint
1. Types of Resources
a. Property
(1) Given to individual by the government
(2) Requires the state for maintenance
b. Inherent
(1) Individual brings to the table
(2) Outlaw can keep it after leaving the table
c. Distributed
(1) Given to individual by the government
(2) Outlaw can keep it after leaving the table
2. Types of Wealth
a. Earned- Created by an Individual
(1) Labor
(2) Capital Management
b. Licenced- Created by the State
c. Found
(1) Natural- Created by Nature
(2) Inherited- Created by Dead Humans
3. Auctions
a. True Market Value
b. Internalizing the true cost of regulations
4. The Citizen’s Dividend
5. Sufficitarianism
a. Maslow’s Hierarchy
b. Cash vs. Payment In Kind
6. Minarchism?
a. Cash vs. Payment In Kind
b. Bureaucracy Bad, Infrastructure Good
7. Corporations
a. Usefulness
b. Governance
c. Taxes
(1) Income
(2) Market Value of Limited Liability
8. Political Alliances
9. Transhumanism
a. What if people stop dying?
b. Turning Inherent resources into Distributed resources
III. The Social Resources Rent (SRR) Tax
A. Concept
1. Liquidating Henry George
B. Market Communism
C. Free Labor Socialism
D. Left-Libertarianism
E. Temporally Divided Income Tax
F. The Year Zero Problem
1. Introduction
2. General Amnesty
3. Total Reparations
4. Unsatisfactory Compromise
5. Georgist Liquidation
Natural Rights
“Natural Rights” is the idea that nature (or God) imbues individuals with certain entitlements, called “rights”. These rights exist independently of any actions by the government or other individuals. Typical rights to which it is believed individuals are entitled include life, liberty, and property. The government has no role in the creation of these rights, but a primary, or possibly the only, duty of government, is to secure these rights through the coercive application of its monopoly on the use of violence. If the government acts in a manner inconsistent with an individual’s natural rights, the government is violating those rights and committing an immoral act.
The primary objection to the concept of natural rights is that they do not exist. To say that I “own” this laptop computer on which I am typing these words, that I have the exclusive right to use or dispose of this computer, makes no statement about the physical properties of this computer that can be confirmed or contradicted by empirical observations. Rights simply do not exist in nature. The utilitarian philosopher Jeremy Bentham famously referred to natural rights theory as “nonsense on stilts”. Relying on religious belief to support the idea of natural rights decreed by God demands proving: 1) God exists. 2) God has communicated with humanity. And 3) The rights being supported have been endorsed by God in His communications to us.
Supporting the existence of natural rights without reference to Devine Decree is even more precarious. Unless you believe that the dinosaurs had natural rights to life, liberty and property that were constantly being violated by other dinosaurs, you must construct some theory as to how such rights came into existence. Theories have been propounded asserting that rights to own unclaimed property can come about by touching it, viewing it, or simply by being the first person to assert such a claim to a specific piece of property. These can all be easily dismissed. How can any of these actions change a physical object in such a way as to connect a particular person to that object? If you and I are wandering through the desert looking for water, can I charge you for a drink at the watering hole simply by yelling “I saw it first!” or maybe dipping my hand in it and yelling “Tag, it’s mine!”? And in case the “simple assertion” method for claiming unclaimed property is valid, I, Timothy Roscoe Carter, hereby claim all previously unclaimed sub-atomic particles and empty space in this or any other universe for myself, my heirs, and my assignees.
A better theory, developed by John Locke, states that I have a right to property that I have “mixed” with my own productive labor. It works like this: I discover gold in the ground. I dig it out. I melt the gold, and then I skillfully form it into a beautiful necklace. Should not the necklace now be mine, to wear, to sell, or to give away as I so chose? There are two ideas at work here. One is dessert. Through skill and hard work, I made a beautiful necklace out of material that nobody else even knew existed. I deserve the necklace. The second idea could be best described as “labor theft”. Suppose someone else takes the necklace without my permission. They are now benefitting, without my agreement, from my skill and hard work in finding the gold, digging it out of the ground, and making the necklace. I have now worked for that person without my consent and without receiving remuneration. Slavery by stealth.
From a strictly materialist standpoint, this theory suffers from the same defect as all natural rights theories of property ownership: There is no spiritual or physical connection between the creator of the necklace and the necklace itself. For those who believe that moral rules can arise from pure logic, there are still problems. Suppose you want to use the gold to make electrical wire. Why should I prevent you from doing so? My discovery of the gold has been dismissed as the “Tag, it’s mine!” theory, you never consented to giving up any freedom to use the gold in exchange for my digging it out of the ground, and you have no plans to benefit from my having crafted the gold into a necklace. So the labor theory of property, that is the theory of using force to prevent others from using an object you manipulated without their consent, has no logical moral force. Still, the idea that I should control the benefits resulting from my own efforts intuitively strikes most people as inherently fair. But it will be shown later that fairness is a social contract concept that can be analyzed separately from morality.
There is a less common but more serious objection to Natural Rights theories. (More serious than pointing out that natural rights do not exist? Yes.) Even if one concedes that natural rights could have arisen out of nature, it is impossible that they can exist now. No theory of natural rights allows for natural rights to exist to property that was obtained by stealth or force from another, or from a voluntary transfer from someone without a natural right to the property. And yet, this is how virtually all property that currently exists in the world was obtained. The United States stole California from Mexico, which had stolen it from Spain, which had stolen it from the native inhabitants, who themselves where not introduced to the concept of land-grabbing wars by white men. This pattern repeats itself everywhere on planet Earth, often with stretches of decades or centuries in which all land is controlled through the coercive violence of a dictatorial government. Before the industrial revolution, much if not most wealth throughout history worldwide was produced with the forced labor of slaves and serfs. Since the industrial revolution, most individuals have been both the victims and the beneficiaries of forced transfers of wealth by governments. So if rights to property ever actually rose out of nature, they were violated out of existence before recorded history and have not had a chance to arise again since. Nor is it clear how such rights could arise in the future. Rectifying these past wrongs would require knowledge no one now possesses about the original rightful owners and their proper heirs, as well as the coercive taking of property from the innocent transferees of long dead perpetrators.
Why is rectification a more serious problem for proponents of natural property rights than objections to very existence of natural rights? Because proponents of natural property rights all admit to the severity of problem, but none has an answer to it. The most famous recent attempt to formulate a coherent theory of natural property rights was Robert Nozick’s Anarchy, State and Utopia. Nozick wrote:
These issues are very complex and are best left to a full treatment of the principle of rectification. In the absence of such a treatment applied to a particular society, one cannot use the analysis and theory presented here to condemn any particular scheme of transfer payments, unless it is clear that no considerations of rectification of injustice could apply to justify it. Although to introduce socialism as the punishment for our sins would be to go to far, past injustices might be so great as to make necessary in the short run a more extensive state in order to rectify them.
Nozick never provided a treatment of the principle of rectification. Neither has any other natural property rights theorist. In my debates with right libertarians, the only response seems to be to shrug at the impossibility of rectification and suggest some sort of arbitrary statute of limitations or to declare some sort of truce and end all violations going forward. Given the socioeconomic status of the vast majority of right libertarians, I feel comfortable calling these the “Let’s quit while I’m ahead” proposals. That they are proposals and not theories is their major flaw. Proposals are negotiation, not argument. Right libertarians want to provide a theoretic moral justification for how property rights arise naturally from past actions. Confronted with the factual impossibility of knowing the past actions necessary to determine proper property rights (or conversely, confronted with the need to, say, return most of the former Confederate states to the Cherokee Nation), they respond with a practical, forward-looking proposal that fails to address the theoretic problem but does conveniently leave them holding their ill-gotten gains.
So even if the have-nots of the world come to accept that certain voluntary actions can create mystical connections between persons and material objects, they still have no reason to treat the current holders of the Earth’s wealth as legitimate. The response of the world’s have-nots to “Let’s quit while I’m ahead” proposals should be, “You hand over your stolen goods first, and then we can discuss the terms of a truce.”
Three Alternatives
How do we determine the proper rules by which society is to be governed? The different forms of how this question is to be answered can be placed into three philosophically distinct groups, which I will label by referencing their most common contemporary manifestations. These are natural rights, utilitarianism, and social contract.
Introduction
This treatise will chart a complete political philosophy from the theoretical foundations through the mechanics of legislation necessary for implementation. Part I will cover the basis of political philosophy, describing the reality of the social contract and deducing the requirements that the terms of the contract should fulfil independent of morality. Part II will explain and defend the political position of left-libertarianism, a moderate form of which produces terms that meet the requirements of a rational social contract as described in Part I. Part III will explain the mechanics for several different versions of a social resources rent (SRR) tax. The various versions of the SRR tax will be shown to efficiently implement several different political positions, including both “strict” left-libertarianism and the more moderate version that meets the requirements of a rational social contract. A society built on the blueprint presented in this treatise will not automatically be utopia, but it will be a society capable of achieving utopia.
Wednesday, September 03, 2003
Gays destroy marriage by not getting married
Jonah Goldberg notes a New York Times story (no link, I don't subscribe) that, "made all of the points that conservative opponents of gay marriage have been making for years." The story involves gays in Canada. Apparently, not many are getting married. "The reason for this surprising reluctance on the part of gay men to marry is that, well, many gay men don't want to get married." Goldberg repeats a quote from the editor of Canadian gay mag Fab: "I'd be for marriage if I thought gay people would challenge and change the institution and not buy into the traditional meaning of 'till death do us part' and monogamy forever. We should be Oscar Wildes and not like everyone else watching the play." He also quotes a sociologist who says, "Will queers now have to live with the heterosexual forms of guilt associated with something called cheating?" He ends with, "...some gay activists see marriage as a kind of prison they'd like to dismantle, and conservatives who suggested otherwise were branded as bigots and homophobes who "just don't get it." Well, if the activists think marriage can still be something called marriage, after the folks at Fab magazine rewrite all the rules, then they are the ones who just don't get it."
To recap: Now that gays can marry in Canada, they are preceding in their devious plan to destroy marriage by refusing to marry. We who wish to protect the institution of marriage need to do so by preventing the few gays who do wish to marry from marrying.
Also in his article, Goldberg devastates an analogy to interracial marriage, stating, "I've never thought such comparisons were sound, and this story demonstrates why. No blacks denounced the concept of monogamy in their struggle to do away with anti-miscegenation laws. When Jackie Robinson fought his way into professional baseball, he didn't want to change the rules of the game. He wanted the rules to apply to him to."
The final nail in the coffin of this analogy comes when Goldberg reveals the percentage of black-white marriages that occurred in the U.S. the year after Loving v. Virginia, which is, um, let's see, where did he put that statistic...?
Friday, June 27, 2003
A message for straight couples in the former Confederacy
If you engage in oral or anal sex over the weekend, be sure to send a small donation to the homosexual legal aid organization of your choice.
Thanks to their efforts, your fun is now perfectly legal. Cheers!
Thursday, June 19, 2003
SF's "Care Not Cash" Will Not Affect the Wheel-Chair Bound
This is off my usual topics and very insider San Francisco, but I had to post.
Listening to public radio this morning, they were covering a protest against SF's "Care Not Cash" initiative, which was overturned by the Superior Court but is being appealed. They talked to a man in a wheelchair who was afraid of being kicked out of the homeless shelters if "Care Not Cash" goes into effect. I am writing to say that such fears are unwarranted (at present).
"Care Not Cash" would reduce cash grants to General Assistance recipients in exchange for providing them with services. Critics say that the city is unable to provide the services to make up for the reduction in cash.
I am an SSI attorney. I can not think of an instance in which a person who medically needs to use a wheelchair for at least 12 months would not be disabled under SSI rules. I just spoke with the main attorney in the case against Prop N ("Care Not Cash"), and he agreed with me that anyone affected by Prop N would meet the financial requirements for SSI. Thus the gentleman in the wheelchair should be on SSI, not GA, and should not be affected by Prop N. If anyone reading this knows someone in both poverty and a wheelchair who is not on SSI, please have them contact their nearest legal aid office.
The attorney I spoke to did mention that there has been "talk" about charging SSI recipients rent for shelter space, but that is not the current policy, nor has such a policy been proposed in any official way.
I am blogging semi-anonymously, and I do not wish to name or quote the attorney I spoke with. Thus, this post should be considered opinion regarding SF ordinances and SSI laws, not news. If anyone has differing opinions, please email me.
Wednesday, June 18, 2003
What Calpundit Taught Me About Taxes.
Kevin Drum had a post about WMDs with a throw-away line referring to several groups of cranks, including believers in the Gold Standard. I am here going to quote some of the comments I participated in, ignoring much, including a pointless flame war I should never have let myself get dragged into.
I wrote: Re: The Gold Standard. I just need to be convinced on this. I used to be a libertarian and supported the gold standard for ideological reasons. I am now a liberal, and am willing to be convinced otherwise. But I just can't help wondering, if money isn't a promise for something tangible, WHAT IS IT? Why exactly does this piece of paper printed by the government mean anything, if it promises nothing? This is not an argument, I sincerely want to know the answers. Plus, I am not a fan of Fed Chairman Allan Greenspan, but it seems extreme to call him a "crank", particularly on matters related to monetary policy.
Kevin responded: "Money is anything that the government accepts as payment of taxes.
This really isn't a joke. "Money" is a remarkably ephemeral concept, and this definition works pretty well."
I responded: "Wow, Kevin, now I know why I read you.
First, let me re-frame my question with an analogy. Government hires Bob to build a bridge. Bob builds the bridge, and then the government gives Bob a bunch of green pieces of paper. Bob says, what are these things, and why do I want them? Under the gold standard, the government says, "These are promises for a specific amount of gold. You can trade them with me for the gold, or with anyone who might want the gold." I was wondering, without backing, what does the government tell Bob? Why should Bob want these pieces of paper? What value to they have?
Kevin gave me the answer: "Well, Bob, these pieces of paper are things that people give us to prevent us from sending them to jail. You can give us some of the pieces of paper if you don't want to go to jail, and you can trade them with other people who don't want to go to jail."
Damn, THAT'S value. And I feel stupid not recognizing this before, being a tax guy myself.
The rest of you can cut it with that "facilitating the trade of goods and services and backed by the trust of the U.S. government" shit. Kevin gave me my answer. Paper currency has value because it is backed by the coercive power of the U.S. government.
I was a libertarian because I was afraid of coercive power and did not think that ANYONE should have such power, even the majority. I have become a liberal because I have come to realize that even capitalism and property require coercive power to operate, and the best solution is to put that power in the hands of an open, rule-based, democratic process. Kevin's answer is both brutally honest AND fits my current world view. Consider me convinced."
Later in another post, I wrote, "The fundamental truth of libertarianism is that everything the government does is backed by coercive power. The fundamental flaw of libertarianism is the belief that markets are or can operate free of coercive backing. Liberals realize the fundamental flaw, but many try to talk about their programs without acknowledging the truth. Although I am now a liberal, I struggle to continue to acknowledge the harsh reality."
Wednesday, June 11, 2003
What's good about republicans?
I believe both conservatives and liberals are blinding themselves to certain realities. Conservatives do not seem to want to acknowledge that racism (including subconscious racists in denial) make up a LARGE portion of the Republican Party base, and without these votes, particularly in the South, the American political spectrum would look a lot like, well, not Europe, but Canada certainly.
On the other hand, the vast majority of independents who vote to put the Republicans in power are not racists, and to believe that Republicans win their votes solely by skilled lying is dangerously self-delusional. Even if does explain our success with Clinton.
I believe that Americans are attracted to the Republican ideas of self-reliance, enterprise, and opportunity for advancement. One problem is that too many liberals seem to agree that those ARE Republican ideas, and liberalism is framed as the government taking care of people and helping to equalize the outcomes of market forces. This is because most of our intellectuals are watered-down socialists. As a result, we seem to have conceded that Republican capitalism is the true capitalism.
It does not have to be this way. Rather than only taking care of the masses, the government could empower them. Rather than equalize outcomes, we can redistribute wealth to equalize opportunities. Successful past wealth redistribution plans, such as the Homestead Act, the G.I. Bill, and subsidized home mortgages, have given the poor opportunity and capital in form of land, homes, and education.
Liberals should not fight capitalism, we should reclaim it for the masses.
Thursday, May 29, 2003
No Administrative Costs
Dallas R. Hall took many years to fully explain his expenses resulting from hisloan sharking operationpersonal lending activity. Tax Court refused to award administrative costs.
Non-Custodial Parent
Howard Jones is the non-custodial parent of his children and did not submit a divorce decree, separation agreement, or written statement from the custodial parent, and could therefor not claim the dependency exemptions for the kids or the resulting EITC.
Frank and Lou-Ann Guarna
Frank and Lou-Ann Guarna had to prorate income-seeking expenses between their Schedule A and Schedule C based on 1) substantialion, if available or required, or 2) pro-rated based on number of days worked at self-employment versus employment throughout the year. They also owed a penalty for filing late.
Tuesday, May 27, 2003
John Edwards for President?
When it comes to the big guys at the top, I tend to be more interested in philosophy than specifics. In this discussion of the Democratic candidates, William Saletan states, "I've seen other candidates speak for workers and against capitalist predation, but Edwards is trying to do something more ambitious: to reclaim the virtues of capitalism."
On John Edwards' official site, the text of his Economic Policy Address At The Fortune Global Forum has this:
First, we should eliminate tax shelters that serve little or no purpose but to provide a legal way for companies to hide their income. Too many people benefit from America's public investments and capital markets and then renounce their citizenship to avoid paying their fair share. That is a disgrace, and it certainly shouldn't be legal. Companies shouldn't be allowed to deposit their officers' salaries in offshore accounts, so their officers can avoid taxes. And American companies should not be allowed to set up virtual headquarters in foreign countries that are hardly more than mailboxes so they can hide profits earned in America.
Second, we should put an end to one of the most distasteful practices the tax code allows - the deduction for life insurance that companies take out on their nonexecutive employees. Companies get billions of dollars in tax breaks by buying policies on thousands of secretaries and janitors who never see a dime of those benefits. Even if the company lays these folks off, they can maintain the policy, get a tax break for doing so, actually collect on the policy when the former employee dies, and get another tax break on top of that. The employees and their families often don't get a dime. The government should not be subsidizing companies to get tax breaks when their former secretaries die. It is economically pointless, it is morally perverse, and it should stop.
Third, we need to make sure that businesses and wealthy investors are held to the same standard as ordinary Americans when it comes to following our tax laws. Something is wrong when a poor working family is four times more likely to be audited than a corporation. Something is wrong when the White House is seeking to muzzle an IRS commissioner who has a simple warning: some fortunate but unscrupulous people are breaking our laws with virtual certainty they won't get caught. We can and we should save law-abiding citizens billions of dollars by requiring fair enforcement of our tax laws.
Finally, we need to take on the political obstacle course of corporate subsides. Washington isn't very good at this kind of thing, and that's why I think Senator McCain and Congressman Gephardt's proposal to establish a commission that will present a complete package for an up or down vote - like the Base Closing Commission - is a good idea.
Pro-capitalist populism? Populist tax reform? My goal as a "leftist" is not to end capitalism: My goal is to make everyone a capitalist. This is not yet an endorsement, but consider me leaning towards Edwards.
Another Efficient Use of IRS's Attorney's Time
Richard Scott Gehrs sold securities but did not earn enough to require him to file taxes due to his basis. IRS called after receiving reports of the sales, and he refused to file a return, because he did make enough money. He wins in Tax Court on the deficiency because of his basis. In the Order, Tax Court said that he did not have a requirement to file a return.
In this case, Gehrs asked for litigation costs. He lost, because Tax Court said that although he did not owe taxes, he did have a requirement to file a return when the IRS made the demand. Way to be consistent, guys.
Thanks to their valiant efforts in defending against this petition, the IRS did not have to pay any of Gerhs' claimed $92.77 in costs.
Form Does Not Trump Function in Employee/ Independent Contractor Status Even for the IRS
Edward Charles Jones was an independent contractor whose work was not controlled by the company that paid him: What control was exerted over his work was exerted by the Navy, which the company that hired him have a contract with. Eventually, the company that paid him had him sign an employment agreement, started withholding half his FICA taxes, and switched from reporting the payments made to him from 1099s to W-2s. Nothing about how he performed his job changed. Jones continued to report his income on a Schedule C. IRS challenged this in an attempt to deny him a full home office deduction. IRS said he was employee, and the deduction should be itemized and subject to limitations under section 67. Tax Court noted that despite the reporting, the "employer" exercised not control over his work, and ruled for Jones.
File Your Tax Returns
Silvia S. Rodriguez learned that if you do not file your tax returns, the IRS can assess your taxes when they like and then have 10 years from that assessment to collect the taxes, and they will not consider an Offer In Compromise until all of your taxes are filed.
Thursday, May 22, 2003
Is the IRS's Definition of Disability Valid?
So I pack up my home computer for a never-ending move to a new home, and Tax Court decides NOW is the time to release an opinion I might actually be qualified to review.
First, go read Stuart Levine�s review of Keeley, in a post entitled �A Depressing Opinion�. He analyzes this case as well as any tax attorney can, so I don�t need to repeat it, and much of what I have to say further in this post will refer to items in his post.
Done? Good.
The reason I am commenting further here is that it turns out that in my day job, I am a legal aid attorney who specializes in representing SSI disability applicants. This perspective seems relevant to analyzing this case.
First, Stuart notes, �the Court concluded, without any real discussion, that Keeley's condition was not irremediable.� This legal sloppiness is indicative of a particular type of discrimination faced by the mentally ill. The mentally ill are treated with an attitude of, �Oh come on! Just snap out of it!� This is an attitude not exhibited around those who are blind, deaf, or missing both their feet, and it steams from a lack of belief in the �reality� of mental illness.
Next, Stuart notes that the restrictive definition of mental illness found in the regulations and applied by Tax Court is absent from the statute. Consider the statutory definition of �disability� as an �inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.� This is not the language from IRC Section 72(m)(7), but the language from 42 USCS Sections 423(d)(1)(A), and 1382c(a)(3)(A), defining disability for purposes of Social Security Disability Insurance and Supplemental Security Income. Social Security�s regulations, however interpret this entirely differently from Treasury�s. Significantly, Social Security does not require, �continued institutionalization or constant supervision� for a mental illness to be a �disability�. To oversimplify, if the mental impairment is medically documented and prevents substantial gainful activity, it is a �disability�. I have helped obtain SSI for many clients based on mental disabilities despite the fact that they live alone, manage their own funds, and see psychiatrists less than once a month.
Now, I have not done the appropriate legal research, but I bet if I did, I would discover the following:
1. The similarity in language from the SSI/SSDI code and the IRC defining disability is not a coincidence.
2. The purpose of the SSI/SSDI code is to help the disabled, the purpose of the IRC is to collect revenue. It is therefor much more likely that the shared definition of disability was developed in the sausage grinder of writing the SSI/SSDI code, and then copied into the IRC, rather than the other way around.
3. The copying of the disability definition from the SSI/SSDI code into the IRC represents an intent on the part of congress that the same standards be used for both.
The Keeley opinion cites only one case, a T.C. case from 1996 (Dwyer), as precedent. All other cites were to the code and regulations. This suggests to me that the underlying regulations have not been challenged above Tax Court, which cannot be expected to consider the implication of the Social Security Code. I therefor have to slightly disagree with Stuart�s conclusion that it is good that this is only a Summary opinion. Rather, I think that if this were not a Summary opinion, it would make a good case for an appeal challenging Treasury�s regulations as not following the intent of the statute.
HUGE CAVEAT: I say I �slightly� disagree because I am not sure that adopting Social Security�s regulatory definitions would be all that beneficial, or that it would have helped Mr. Keeley. True, in a Social Security disability hearing under these facts, no Administrative Law Judge would question whether or not Mr. Keeley suffered from a severe mental disorder. Of course he did. No, the big issue at the SSDI hearing would be whether he was capable of engaging in �substantial gainful activity� (SGA). Treasury regulations define SGA as the activity, or a comparable activity, in which the individual customarily engaged prior to the disability. Sounds great to me. Social Security, oversimplifying again, defines SGA as any work earing over $800.00 per month. Can Mr. Keeley collect tickets at a movie theater? Can he stuff envelopes? Can he be a gas station attendant? Can he be a security guard? You know, the kind that just sits there and watches the video monitor? I swear to God this is type of shit I deal with on a daily basis. Of course, I can avoid this by proving that Mr. Keeley�s depression is bad enough to be a �listed� level impairment, but with Mr. Keeeley showing moderately severe symptoms it would be a very close call and involve a lot of complex medical evidence that the tax experts sitting in Tax Court have no reason to understand.
So we have a choice between the regulations written by the accountants running the IRS who don�t understand real-world mental illness, and the regulations written by the health care administrators running Social Security who don�t understand real world ecconomics.
Thursday, May 15, 2003
What Does It Take for the IRS Not to be Subatantially Justified?
After the IRS conceded before trial that Allen R. Krawczyk is indeed entitled to HoH filing status, exemptions and credits for his two kids, and the EITC, he moved for litigation costs. Okay, so asking for $448,010.78 was undoubtable outside the range of the justifiable, and he did neglect to respond to some inquiries from the IRS. But after the first 30 letter, Krawczyk did send the IRS copies of several utility bills, Social Security cards for himself and his two kids, and two letters from a school stating that the kids resided with him. I will concede that he should have answered questions about his marital status before the IRS was not substantially justified on the HoH issue, but why did they need more information about his payment of support for the kids for the exemptions and credits? Didn't he offer enough to justify a presumption favoring those issues? Not to Tax Court, and Krawczyk received no litigation costs.
This is particularly disheartening to me, because I have considered the possibility of striking out on my own with this business model: Represent poor people in conflict with the IRS pro bono, then use the most recent EAJA type legislation to collect fees from the government. However from my work with poor now, I know that most of the work you have to do is help them gather end properly present the information that helps their case. Apparently, under these rules, the clock would not start ticking for me to get paid until after I have done all of that.
So apparently, I cannot afford to help poor taxpayers, even with the new EAJA-type rules.
Tuesday, May 13, 2003
Read the Futures, Not the Polls
Don't believe the opinion polls. Bush I had higher ratings this time in his term from an Iraq war and lost badly. Approval ratings today are no measure of how people will vote a year and a half from now, and answering machines, cell phones, and decreased willingness to participate are making polls less reliable even with regard to current opinion. But there is a better measure.
The Iowa Electronics Market is running a real money futures market based on the 2004 election. Two, actually. One is the 2004 US Presidential Election Vote Share Market and the other is the 2004 Democratic Convention Market. These markets attractgamblersinvestors who are looking at the future, not the present, and are willing to risk their money on the outcome. Empirical studies have shown that these markets are better predictors than polls of either the public or experts. (I once read the academic paper proving this off the web, and I will post the link as soon as I can find it again.)
Anyway go look at the current values of the 2004 Democratic Convention Market. Kerry has the best odds of winning of the four being tracked (Hillary Clinton, Gephart, Kerry, and Lieberman), at 30.6%. However, even he trails "rest of Field" at 38.4%. So we really don't know.
But the the more interesting market, and the one causing me to write this post, is the 2004 US Presidential Vote Share Market. What is fascinating about this market is that it not only tracks each potential Democrat's likely eventual share of the Presidential vote if he or she win the nomination, but also tracks Bush's eventual share depending on who he runs against.
This is what is crucial. Democrats can use this decide who to nominate, based on who is most likely to do job #1: Beat Bush. Unfortunately, the current values of this market do not, by themselves, tell us what we really want to know: What are the odds of Bush winning against any specific candidate? This requires someone to go through the results and divide Bush's value vs. each candidate by the total of that value and that Democrat's value. That is what I have done here, for values as of 7pm Pacific Time.
First, the news is not good. Currently, Bush has a higher value than all of his opponents, and his lowest value is against Clinton, who is not running. (Although that fact itself may explain why he is nearly equal to her.) I have expressed these chances as the percentage vote Bush the market predicts Bush will receive against the various candidates.
Bush Vs.
Clinton - 50.6%
Gephart - 54.2%
Kerry - 54.3%
Liebermen - 59.8%
Rest of Field - 53.7%
Parting observation - Bush does worse the more left-leaning the candidate is!
IRS Substatially Justified At Least Until They Recieve Documentation from Taxpayers
James L. and Sherri R. Goertler attempted to recover fees paid to their accountant to deal with the IRS's inquiry into the legitimacy of a claimed dependency exemption. But the IRS settled in a reasonable time after they received proper documentation. The length of the case seems to have resulted from the accountant's failure to send the documents along with letters and faxes he sent to the IRS. Tax Court is right, the IRS should not pay the accountant's fees. And frankly, neither should the Goertlers.
Separated Parents Dependancy Ruling.
IRS wanted to deny a dependency exemption to Michael Kevin for his daughter from a previous marriage. While the separation agreement gave him the right to claim the exemption, it was not incorporated into the eventual divorce decree. Also, the separation agreement did not specify which years the exemption was for or what conditions would cause the agreement to end.
Tax Court ruled for Kevin. The separation agreement met statutory requirements, and there is nothing in the code or regs requiring that it be incorporated explicitly into the divorce decree. Under the state's law, the separation agreement is still an enforceable contract, and that is good enough. Also, the lack of specifying years did not invalidate the agreement's effect on the exemption, as the language of the agreement made it clear that it applied to all years.
Nice call by the Tax Court. There are a lot cases on the issue of claiming kids from separated parents. Obviously, these rules need simplification.
Saturday, May 10, 2003
Another efficient use of the IRS's time
Heather Lee Comeau Sliwinski had an AGI $13,930 which included $10,150 in self-employment income from picking nuts. She lived in a cabin on 2 acres in Wolf Creek, Montana, aka The Middle of NoWhere, with her the children. She claimed her stepbrother and stepsister as dependents, but not her children, and also claimed head of household filing status and the EIC. The IRS disallowed the stepsiblings as dependents, fine, and therefor also disallowed the HoH and EITC, fine. After she files a petition to tax court, she files an amended return claiming two of her children, for whom she received birth certificates and SSNs after she filed her original returns. At trial, she won thank God, because the IRS did not object to her raising the new issue of having kids. Sympathy or incompetence.
I vote for incompetence. Not just because this is the IRS, but they also tried to deny that she had the $10,150 in self-employment income, despite having an invoice. Sliwinski did not receive assistance form the state. How the hell did the IRS think she and her family ate? And if they had won on the dependents, do we really believe they would have maintained this position and refunded her self-employment tax. Luckily the IRS lost here, too.
Next time, please use the IRS's attorney's time to audit Microsoft, Citibank, or someone else who actually has money.
Wednesday, May 07, 2003
Not Going to Do It
No, I am not reading the 259 page decision in the case of Bank One Corporation, at least not without getting paid $150/ hour. It looks to be the definitive case regarding the taxation of interest rate swaps, if you are into that sort of thing.
Another Nut
Charles C. Jones is a nut-case tax protester. Tax Court ruled against him and warned him of fines if he continues with frivolous arguments.
Tuesday, May 06, 2003
Another Single Dad Who Can't Claim Kid (And Again the IRS Can't Read the EITC Tables)
Christopher Christie can not claim his daughter as a dependant because his testimony does not support finding that he provided more than half her financial support, he cannot claim Head of Household filing status because his testimony does not support finding that he maintained a household, and he cannot claim his daughter as a qualifying child for EITC because she is 20 years old. However, he is entitled to EITC for persons without a qualifying child.
This case, and that of Lakim Love Allah from a couple of weeks ago, illustrate the issues discussed recently in A Taxing Blog regarding the IRS's proposed requirements for proof of entitlement to EITC. I was glad to see Victor's discussion today regarding the possible unconstitutionality of the policy, which is something I had been wondering about since reading his last post. I hesitate to offer my thoughts on the issue, because I would really like to argue this case in court (against the IRS), but despite my efforts, I will probably not be in that position, so I should point out that I think the IRS has a slightly better position than he suggests. First, since the sex discrimination is intended to reduce significantly the number of poor people affected by the new substantiation requirements, I think some liberal judges and Justices could be persuaded that "it serves important governmental objectives and the discriminatory means employed are substantially related to the achievement of those objectives". Second, Victor states, "...while there may be some biological urges that make it somewhat more likely for children to live with their mothers than their fathers (and I'm not even sure about that), it is clear to me that the presumption that children live with their mothers is primarily a social construction, not a predetermined biological fact." If the IRS lawyers bring up the incredible health benefits to both mother and child from breast-feeding through toddlerhood, it will be a tough argument for a liberal tax attorney (again, meaning me, in my fantasies), to rebut as a "social construction".
I do ultimately think the policy is unconstitutional, but it is a close call and will take a SCOTUS decision, or a bunch of circuit court decisions, to finally declare it so, which means poor single dads are stuck with it for a while. And if the cases of Christie and Allah are a guide, the IRS will be using it deny these guys even the EITC they are entitled to.
Wednesday, April 30, 2003
Foolish taxpayer believes IRS
Sigh. When are people like Debra Sue Tussey going to learn? Just because you call the IRS's free advice telephone line, or just because the IRS sends you a letter telling you that they have abated the taxes they previously said you owed, it does not mean that you can rely on the advice or that you do not owe the taxes. When you are sovereign, you do not have to be consistent.
Are federal taxes flat or regressive?
Calpundit has recently been enlightening the blogisphere about how federal income have in the past half century gone from being progressive to essentially flat. I posted the following in his comments to his lastest post on the subject:
Kevin has documented several times on this site that income taxes have dropped from being "progressive" and are now already "flat".
Since Kevin is now writing about our ideals of taxes, I would like to point out that ALL income taxes are INHERENTLY REGRESSIVE, because they tax INCOME.
The rich benefit more from taxes because the government provides protection of and services to their property, or I'll call it, their wealth. A fair tax would therefor tax people on their WEALTH. Taxing wealth would create no disincentives, as wealth already exists. Instead, we tax income, which is the creation of wealth. This is an economic disincentive if you believe the libertarians here, or economically neutral if you believe Kevin.
An income tax is also profoundly unfair. At the low end, people who have nothing and must work to survive pay taxes despite having costing the government very little in terms of protection. At the high end people who earn $300,000 per year because they perform heart surgery or fly commercial airliners pay the same taxes as someone who "earns" $300,000 per year because their grandfather died and left them a $3 million estate. Actually, the professionals pay more because some of the spoiled brat's income is from capital gains. And if Bush gets his way with dividend exemptions, the spoiled brat may pay no taxes at all.
You're wrong, Kevin. Our federal taxes are not flat, they are profoundly regressive. The problem is that you have bought into the idea of measuring taxes against income, rather than wealth.
Tuesday, April 29, 2003
Rockie D. Elmore
Who the IRS delegates to sign notices of levy is an internal agency decision that Tax Court declines to review.
More Las Vegas Nuts
Daniel Holguin and Sally A. Holguin are nut-case tax protesters challenging liability for taxes at hearing on collection. As to Daniel, Tax Court allowed the collection and imposed a $1,600 fine. Luckily for Sally, she failed to file her petition timely, and her case was dismissed for lack of jurisdiction.
Working class business owners need affordable tax advice
Jack H. Meyer could have used a tax advisor. His attempt to claim the credit for excess Social Security and Medicare taxes was just wrong, but his other problems could have been reduced or avoided with proper advice. Many of his claimed Schedule C deductions were disallowed or recharacterized as Schedule A, many probably due to a lack of planning. Worst, he was denied a claimed "Losses brought forward" deduction, when it was obvious he simply did not understand the NOL rules.
Corona Pathology Services, Inc.
Whatever else the merits, it is not abuse of discretion for the IRS to deny an installment agreement if you have not filed all of your tax returns.
Nick A. Shubin
IRS had proof it mailed a notice of deficiency to Shubin for 1996 at a time to make his petition for that year late. Petitions for other years were not warranted because the IRS had not issued notices of deficiency. Dismissed for all years due to lack of jurisdiction.
Family Tragedy does not excuse late filing
David H. Kilson learned that if you can go to work, you can file your taxes.
IRS taxes man on money they took from his retirement account
Okay, Tax Court's decision here is correct, but I still shared this with my wife as an example of the cruelty of the system.
Nick Allen Palmerino owed unpaid taxes for 1996. In may of 1998, the IRS imposed a levy on his 401(k) account, and took what was owed. This case is about taxes the IRS says he owes for 1998. Why? Because he did not include the money the IRS took from him as income. Tax Court ruled for the IRS. Everything in the account was tax-deferred, and the distribution benefited Palmerino by relieving him of debt. This analysis is correct, but still the effect seems monumentally unfair: The IRS can tax you for money they take from your retirement.
Of course, the IRS would like to be even more cruel, but Tax Court is holding them back. A footnote points out that the IRS has acquiesced to a prior Tax Court decision striking down the 10 percent early withdrawal penalty under similar circumstances. However, the footnote also states that this acquiescence only applies to levies on retirement accounts prior to the 21st century. So watch out. If your client owes taxes and has a retirement account, the IRS can take the retirement, charge a tax on it, and possibly impose a penalty as well.
Just how bad of an idea is further tax cuts?
This article suggests that even the reduced tax cuts Bush may get are a dangerous gamble.
From Reason. That's right, Reason.
Even the libertarians are having trouble defending this.
Monday, April 28, 2003
Tax Court Website Redesign
I like it so far. It is less fancy, I think, but the navigation seems a bit easier, which is much more important. One intriging new feature is the Judges biographies. Most important, however, is that you can now do a word search of the text of historical opinions.
Another Nut
Brian Hilvety is a nut-case tax protester. Tax Court against him and imposed a $500 fine.
Another Nut
Lavonne Allen Hodgson is a nut-case tax protester challenging liability for taxes at hearing on collection. Tax Court allowed the collectionand imposed a $5,000 fine. This time Tax Court said why the penalty was higher than most: Hodgson had been warned of a penalty previously.
Apology to Readers
Obviously, I am way behind. I was finishing the tax season, just bought a house, the number of opinions this month has been huge, blah, blah, blah. I am sorry. At this rate, I probably will be unable to keep up with my goal of blogging every Tax Court opinion. I will have to cut back, but I am uncertain how. The easiest thing for me, and of most use to my readers, would be to cut out Summary opinions and only blog TC and Memo decisions. However, I have a particular interest in individual taxes and issues affecting the poor, and Summary opinions are where many of these issues show up. I will be working on some reviews tonight, and I will let readers know my new self-imposed goals once I set them.
Wednesday, April 23, 2003
Consumption Tax or Wage Tax?
In a post regarding "Phasing in the Dividend Tax Cut" today over at A Taxing Blog, Victor writes, "...the Bush plan is part of a broader agenda to move us away from an income tax and towards a consumption tax, where all investment income would not be taxed at all. And many smart people do think that moving towards a consumption tax is sensible (or at least inevitable). "
In response, I have reposted below a post from before A Taxing Blog began, questioning whether the Republicans really are headed to a consumption tax, or a wage tax. Please note that I am not a tax policy expert, and I am not questioning what Republicans want to do, but what they will do, if given the opportunity.
Of course, it is also possible that I am misunderstanding things here, and that a wage tax is a form of a consumption tax, since it adds to cost of production. Or is that a "value-added" tax? I am obviously not up to date on the terminology here. My point is that the Republicans will end up placing the tax burden on the working poor, not on "spending" per se.
Note: What I responding to is actually a somewhat minor point in a longer post about the dividend tax cut.
Reposting of a Post from February 11, 2003
As an attorney for the poor with an interest in taxation, I feel obligated to link to this column by Molly Ivins detailing how the IRS is tougher on the poor than on the rich.
What I think she gets wrong is her claim that conservatives want to eliminate the individual income tax. Some may propose that in theory, but if you look at all of their priorities and arguments, that is not where they are going. Look at their actual proposals:
*Eliminate the Spoiled Brat Tax (aka the Estate tax, only applicable to millionaires).
*Eliminate the corporate income tax because it is �double taxation� to charge an extra tax on fictional, government-created entities that have special legal privileges that actual, flesh & blood citizens do not have.
*Eliminate taxes on dividends because it encourages companies to retain earnings and, well, invest in the economy and hire people, etc. Plus, it is also double taxation, because of the existence of the corporate tax. (See how that works? Problem? Earnings are taxed twice: Once in the corporation, and once as dividends. Solution? Eliminate both taxes. No more double taxation.)
*Eliminate the capital gains tax to encourage investment. This will become an imperative after they have eliminated the dividends tax, since corporations will have less of an incentive to keep money to invest.
*Eliminate all other investment taxes. Well, okay, I have only heard that one actually proposed by Steve Forbes, but what is important for my thesis is that this seems to be priority over killing the individual income tax completely. Plus all of the other, �more serious� proposals seem to be heading in that direction.
If the conservatives achieved all of the above, what would be left of the individual income tax? It would become a wage tax. At that point, would they continue the crusade to end the individual income tax and replace it with a value-added tax? I doubt it. Sure some zealots who don�t actually hold office or donate to campaigns might continue the fight, but I think they would become as ostracized as conservatives who still believe in balancing the budget. Most Republican voters who actually work for a living tend to vote on social issues like banning abortions, ending affirmative action, and teaching creationism in science classes. The rich enjoy spending their money. If only the little people who work for a living are paying taxes, why should they end that and tax shopping?
A government financed entirely from a wage tax. That is my prediction of where the Republicans are headed.
Tuesday, April 22, 2003
Decnavda gets a severe ego-puncturing
Decnavda's Dialectic is now the number 2 result on Yahoo! Search for "worthless lawsites". Why was someone looking for this anyway?
Monday, April 21, 2003
Tax Court Uses State Court Decision as Evidence for Equity
Guy Nathaniel Gay, Jr. requested spousal relief from tax debts owed with his ex-wife Kimberly S. Gibson, based on 1099 income she earned while they were separated. Tax Court denied relief under section 6015(b) and (c) because Gay knew about the income she did not report. Indeed, his catty comments about her in his request for relief about how egregious it was that she did not report some of the income listed the payor and the fact that it was over $14,000 were used against him to show that he had actual knowledge of the income.
However, Tax Court ruled that the IRS abused its discretion by denying him equitable relief under section 6015(f). IRS, as usual, based its denial primarily on the fact that he had actual knowledge of the income that was not reported. Tax Court does not say so in this case, but I believe in a prior case they pointed out that this reasoning fails to make relief under (f) any different from relief under (b) or (c). Anyway, in finding for Gay, Tax Court relies primarily on the North Carolina court order requiring Gibson to either pay the liability in question or indemnify Gay for the amount. Tax Court does not actually explain why this trumps all other factors, and I can not really articulate why either, but I tend to agree. Normally, such an order requiring payment or indemnity would not be binding, or even influential, on Tax Court, but then Tax Court rarely gets to consider equities. While it may not fit into a legal box, relieving him of joint liability is fair given that she has been ordered to assume the debt in another court, and section 6015(f) creates a "fairness" ("equities") box in the law.
Tax Court Plays Hide the Ball in Case of Robert Rodriguez
Rodriguez disputes IRS's determination of amounts owed and penalties for various years that the IRS filed for him because he did not file. He claims the IRS lacks adequate evidence of the income and is wrong not to let let him take certain deduction that Tax Court does not enumerate. Yet Mr. Rodriguez presented no evidence in his own behalf, and did not even testify, citing the Fifth Amendment right against self-incrimination. Tax Court not only finds for IRS, but, on a total due of taxes and penalties of $9,032.46, Tax Court also imposes a frivolous suit penalty of $10,000.
So what the hell is going on here. $10,000 is significantly higher than most protesters get, and Mr. Rodriguez does not appear to be a protester. Tax Court does not tell us what IRS's evidence of income is, and as usual they do not explain how they calculated the penalty. My guess is that IRS is claiming Rodriguez had illegal income (which would explain why they were denying deductions). If this is correct, Tax Court's frivolousness penalty of $10,000 for lack of evidence may actually be punishing Mr. Rodriguez for the legitimate exercise of a constitutional right. This extraordinary penalty sure looks to me like Tax Court was trying to get Mr. Rodriguez for more than just wasting their time.
I wonder if anyone has ever appealed these frivolousness penalties on the grounds that Tax Court does not provide enough of an explanation of how they are calculated to allow an appeals court to determine if they have abused their discretion?
Tax Court Rejects Aviation Pioneer's Marriage Fraud
If you want to read the case of Dale A. Rinehart and Jeana L. Yeager for the tax issues (and really, why else would you be reading this blog?), the important issues here involve (1) an example of Tax Court disregarding a State Court decision on a matter that it normally defers to state courts on (the status of a marriage) because Tax Court believes the Supreme Court of the particular state would not uphold the finding if it was a aware of all of the evidence that Tax Court possessed (specifically, that the evidence presented to the State Court in an annulment proceeding was fraudulent), and (2) a reiteration of the sham transaction doctrine in a footnote.
Alternatively, some people may be fascinated at the �where are they now?� aspect of the facts about the life of Jeana L. Yeager. Yeager (who I believe is the daughter of Chuck Yeager, although this case does not confirm this) and Richard G. Rutan flew an aircraft around the world without stopping or refueling in 1986. This was the first such flight ever, and the aircraft they used now hangs in the Smithsonian Air and Space Museum. Rutan later sued Yeager, claiming she had misappropriated funds and memorabilia related to their venture. Yeager�s husband (Rinehart) filed for an annulment of their marriage to protect his assets from the lawsuit, and Yeager testified falsely that she had not obtained a final divorce from her previous husband. This case, the third time Rinehart and Yeager have lost in Tax Court, involved penalties stemming from the two of them claiming filing statuses of single rather than married filing separately.
Fascinating. Depressing, but fascinating.
