Fairness and Freedom
Fairness is a value judgment. In the fight over taxing the rich, those with good values are losing the judgment. They are losing because they have failed to name, and defend, the moral right which ought to define fairness toward all taxpayers: the right to own and to keep the wealth you create.
President Obama proudly articulates the moral case for the other side. The president makes no apology for targeting the wealthy simply on grounds of their wealth. He campaigned, and is now governing, on the moral premise that the wealthy owe more than they are paying and that raising tax rates on them is not primarily about budgets and balance sheets but about economic fairness. The Republicans, in focusing their efforts on raising tax revenues by shrinking deductions and loopholes rather than raising rates, have ceded the moral high ground and reduced the debate to a mere question of means and not values.
Recent polls suggest that most Americans agree with Obama that the rich should be taxed more than they are. No wonder. When an impassioned moral argument on one side -- even the wrong side -- is met with tepid utilitarian wish-wash on the other, it should not amaze us when the wrong side wins. Wealthy Americans already pay a vastly disproportionate share of taxes. Yet Republicans, along with Democrats, are working feverishly to find ways of commandeering more income from the "rich" (albeit using different methods). Republicans argue that hiking tax rates on the rich would be wrong, not because wealthy Americans have the right to keep what they earned, but because raising tax rates on the wealthy doesn't work -- that it won't adequately shrink the deficit and the debt; or will discourage entrepreneurs from creating jobs; or won't solve the entitlement crisis. This necessarily implies that if such a policy would work -- if taking more money from the wealthy would meet the government's goals -- then taxing the rich would be just fine.
This is why the Republicans seem, and are, so weak in their negotiations with Obama over the "fiscal cliff". Against the president's moral argument about fairness they advance the anemic utilitarian claim that raising tax rates for (1) a seemingly tiny percentage of individuals and businesses, and (2) to a level rates were at during the Clinton era when the economy was doing quite well, would somehow quash job creation; seriously injure the economy; delay its recovery from recession. Raising tax rates, they argue, would not work; would not solve the country's economic problems.
But fairness is not about what works. Fairness is about what's right. By implying that the president's fairness premise is correct and that it is merely Obama's proposed means which are mistaken, the Republicans have given up the fight. Someone needs to take it back. Someone needs to make clear that Obama's moral premises, not his microeconomic theory, are what make his fairness argument wrong.
The claim that wealthy people owe more taxes to government, that it's not fair unless they pay more whenever the country needs it, necessarily embraces certain value judgments that are rarely if ever exposed in political debate. The fairness claim necessarily denies that people have the presumptive moral right to own the money they earn. It necessarily implies that if you do earn a lot of money, that fact alone -- the mere fact that you are wealthy -- makes you a legitimate target of government-authorized confiscation. It necessarily implies that wealth is suspect -- that those who are wealthy owe that wealth, in large measure, to the rest of the country; that, at the discretion of the country, they may be allowed to keep and use it so long as that "works" for society, but that if and when society decides that it needs that wealth to accomplish goals which require more money -- to implement a national health care plan, or shrink the deficit, or fund entitlement programs to which the nation has become accustomed -- then society may lay claim to as much of that wealth as it needs to accomplish those goals, and those who earned the wealth will then owe that money to the nation. Obama's fairness argument upends the core presumption of a free economy -- that people are entitled to the wealth they earn by their labor -- in favor of a presumption that wealth, however earned, is a collective resource which may be redistributed at the pleasure of a democratic majority.
Once the core ownership presumption has been turned inside out, all structural limits to government encroachment vanish. We don't need to look far to see the potential results -- a 50% tax rate on millionaires in the United Kingdom; an imminent 75% tax rate on the wealthy in socialist France. If we accept the moral presumption that wealth is a collective resource, we surrender the moral premise in favor of private property, the premise which protects all individuals, their labor, and their freedom by rooting those things in the right to earn and to keep their earnings. Free-market liberals cannot afford to lose this moral battle. And we are not even fighting it.