A Connection Between Higher Taxes and Freedom of Thought

Is economic freedom important?

There is a slice of American society, many of whom are on the political right, for whom economic freedom—usually characterized by a desire for a libertarian or near anarcho-capitalist society—is an ultimate good that is good in and of itself.

In response, some on the left, especially young people who have lived in the extreme prosperity of the modern West, see economic freedom as an evil to be curbed through “more effective” redistribution of wealth through violence (think the Bezos guillotine protests) or, at the very least, expansive government programs fueled by high taxes.

For some, high taxes are a comparatively small threat when the “major threat of the far right” is concentration camps and a rather pointless, though exceedingly bloody battle in World War I.

One certified blue-checked media personality recently commented: “Seems poignant that the major threat of the far left is higher taxes, while the major threat of the far right is, well, Dachau or Verdun.”

This is, no doubt, a flippant comment in a larger conversation (albeit one that occurred in public), but it is illustrative of a tendency of some to minimize the powerful effect of growing concentrations of power, whether in government or in corporations.

There is no question that there is more than an undercurrent of hostility toward civilization on the far right. However, it remains an open question whether the “major threat of the far left” is something a bit more significant than higher taxes. The violence of Antifa and some of the riots from the summer of 2020 caused by agitators from the far-left indicate that on both poles there is cause for concern.

The Value of Economic Freedom

But the question remains whether higher taxes are really an insignificant threat.

I think it is entirely possible to believe that higher taxes are not “the major threat of the far left” while still believing them to be a significant threat to a healthy society. Of course, that belief would depend on recognizing the value of economic freedom.

Economic freedom is necessary for human flourishing, but it is not sufficient for human flourishing.

An entirely free market (which the U.S. is very far from) would not make people holy and happy. In fact, as we’ve seen through the rise of modernity, economic freedom can leave people nearly as miserable (and sometimes more so) than certain forms of totalitarianism.

In the end, economic freedom does not produce happiness. However, economic freedom does enable, for those who are virtuous and especially in a (basically) virtuous society, the ability to thrive and fulfill the unique calling of being human.

The qualified value of economic freedom can be seen by the effects of its absence.

Alternatives to Economic Freedom

If, as some versions of socialism propose, the government regulates the amount of money a person can earn, then the government fundamentally has the power to police much of human activity.

All human activity is not economic. However, a great deal of human activity is economically engaged. Even “free” activities like worship depend on the economic ability to (a) afford leisure time (i.e., time not directed toward economic productivity) to gather for worship, (b) the ability for a community of like-minded individuals to cooperate and pool resources to fund a house of worship, a vocational pastor, and to support ministries that serve the common good. The economic support for these non-economic goods is enabled by some degree of economic freedom. One must have disposable income to support ideas and communities that one prefers.

Consider further that if the government holds the keys to all wealth, even through well-intentioned redistribution programs funded by confiscatory taxes, then they hold the keys to all ideologies. If disagreeing with the powers that be (especially if those powers are in favor of increased economic control of citizens) can lead to having funding choked off through job loss or increased taxation (which might be in the form of taxation of despised charitable groups, like churches, or preferential treatment of certain charities through access to grants, etc.), then freedom of thought and speech are greatly restricted.

To be clear, the political right has often made mountains out of molehills here. Bad policies like the Affordable Care Act and the Green New Deal are not usually going to lead directly to the forms of economic control that full-on communism has. They will, thus, be unlikely to immediately exert totalitarian control over human thought.

But such soft-totalitarianism isn’t beyond the realm of possibility. Though the Affordable Care Act, for example, does not necessarily entail totalitarianism, the seeds for it have been made evident by the coercive power that has been used in the name of the ACA.

Although the law itself does not actually require funding birth-control or abortifacients, the overriding concern of the regulators responsible for administration of the Affordable Care Act has been coercing, through economic and legal means, groups that object to those medical technologies to fund them. It’s not enough to ensure that workers are medically shielded from significant emergencies; many on the left are insistent that conscientious objectors be forced to fund certain ideologically preferred treatments. For example, there has been a near-pathological focus by the Left on attacking the Little Sisters for the Poor by every means available to demand they fund abortion and abortifacients in strong opposition to their conscience.

For those watching the message is clear: “Fund the ‘medical’ services we prefer or stop existing in the public square. We are willing to use the force of law to force you to comply.”

The same voices that are attempting to claw back economic freedom from people are the ones that seem to be also bent on enforcing ideological homogeneity around their preferred theories. “Cancel culture” is a real thing. Now imagine if the thought leaders that have the power to enact “cancel culture” also have the ability to cut non-preferred individuals out from government benefits.

There may be no edict that declares that one must voice allegiance to ideologies like “white fragility,” but if only meager subsistence is possible apart from government support and if support from the government requires public support for particular ideologies, then the connection between economic freedom and the more basic freedom of conscience (or thought; or speech) becomes apparent.

This seems unthinkable in contemporary America, but dramatic shifts toward public tolerance of contrary ideas has happened rapidly within the history of the past century.

Economic Freedom and Free Thinking

Economic freedom is not sufficient for free thought or the flourishing of society, but it is necessary.

In an essay for a series entitled, “Is Progress Possible?,” C. S. Lewis notes this correlation between flourishing and economic freedom:

“I believe a man is happier, and happy in a richer way, if he has ‘the free-born mind’. But I doubt whether he can have this without economic independence, which the new society [the rising democratic socialism in the U.K.] is abolishing. For economic independence allows an education not controlled by Government and in adult life it is the man who needs, and asks, nothing of the Government who can criticize its acts and snap its fingers at its ideology. Read Montaigne; that’s the voice of a man with his legs under his own table, eating the mutton and turnips raised on his own land. Who will talk like that when the State is everyone’s schoolmaster and employer? Admittedly, when man was untamed, such liberty belonged only to the few. I know. Hence the horrible suspicion that our only choice is between the societies with few freemen and societies with none.”

Or, consider Vaclav Havel’s lengthy essay “The Power of the Powerless,” in which he recounts the soft-totalitarianism of the Soviet ruled Czechoslovakia, where a rebellious act by the green-grocer could be merely not putting up the most recent socialist propaganda in the midst of his produce. The government that controls the economy controls the ability to think and speak.

Threat of Higher Taxes

So the threat of higher taxes is not, perhaps, the major threat from the far-left. Their recently demonstrated willingness to storm cafes to demand people make hand gestures to support their cause, to throw their food on the ground, and to harass them for daring to have quiet conversation with a friend or family member that doesn’t specifically advocate some twisted idea of “justice” are a much deeper threat. Along with that threat is the increasing violence of Antifa, whose methods look more and more like the sort of jackbooted thuggery that they claim to be resisting.

But the threat of an unending expansion of government along the lines proposed by some on the far left, including the outlines explicitly found in proponents of the Green New Deal, are real. It’s more than just higher taxes, but the ability to control the economy to stifle differing opinions.

It seems like hyperbole or slippery slope argumentation to some, but based on the words and behavior of the far left, the less unlikely such attempts to grasp power appear. The most virulent elements on the right and left are still marginal, though they tend to get disproportionate amounts of attention due to the nature of clicks and social networks.

The deeper question for those concerned about the negative effects of the polarized left and right is how to find common cause, create space for cooperation toward mutual concerns, and carve out appropriate space for conscience among increasingly divided understanding of good. That will require a more careful navigation of the significant dangers of the far left and right than simply labeling every disfavored policy on the left “socialism” or denying any concerns about freedom from the right as “selfish individualism” or “fear mongering.”

The Great Risk Shift - A Review

There has been a shift in recent decades in the United States on several fronts. The rise of the internet has both fragmented local communities and allowed cliques to form over great distances around a common (and sometimes really weird) interest. Politically, the two dominant parties in the United States have become more polarized than in the middle of the 20th century. And, according to Jacob Hacker, there has been an invidious shift in risk from broad risk pools to individuals.

Hacker’s book, The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream, is meant to show that injustice perpetrated by Republicans and other economic and social conservatives that tend to lean that direction (particularly given the options) is keeping the little guy down. The nation has seen continued attacks on the policies of redistribution imposed by FDR’s New Deal and LBJ’s Great Society movements. Defined benefit corporate pensions have been replaced by 401k plans, which force individuals to take responsibility for their own saving.

In The Great Risk Shift, Hacker presents a declinist narrative with a call to make America great again by expanding government programs, moving back toward pensions in corporate jobs, and generally trying to spread out risk to the entire nation. He begins by painting an apocalyptic picture of economic insecurity, focusing particularly on the financial crisis of the last decade. That shows, according to Hacker, how precarious life must be. In the second chapter he puts a line in the sand between those who feel that there should be a measure of accountability in risky decisions to those who believe risk should be shared equally. In the remaining four content chapters Hacker presents some data that illustrates his point about the risk to jobs, families, retirement, and due to the rising costs of health care based on a refusal to nationalize all risk. He concludes the book by a call to create new government programs, expand the ones we have nearly indefinitely, increases taxes dramatically, and hopefully get a robust economy that makes everyone reasonably wealthy simultaneously.

Hacker teaches at Yale, so he likely has done careful, well-reasoned scholarship to ascend to that level. This book is not that, but is a call to action intended to mobilize the already outraged. The argument, such as it is, in The Great Risk Shift is likely to galvanize the convinced, but has little power to convince those (like me, for example) who might agree with a number of his premises, but want an approach that takes reality into account. After the first couple of chapters, the book is a tedious tirade that is likely to ensure Hacker gets to speak on cable news, but does little to expand the range of human knowledge.

At the same time, Hacker has some worthwhile observations. There has been a significant shift in the last few decades toward a more individualized burden of risk. The shift away from the life-long, supposedly guaranteed, defined benefit corporate pension has changed the landscape of employment. To Hacker’s mind, that has been entirely to the negative. This example is perhaps the best way to show the major flaws in Hacker’s argument.

Based on Hacker’s argument, corporate pensions have been replaced by the 401k. That is entirely bad because fewer people have access to permanent security that gets funded on their behalf. All people had to do back in the good old days of pensions (when America was great?) is work at the same job for a few decades and, if they made it to 20, 30, 35 years, or whatever, they would walk away with a gold watch and a steady stream of replacement income for life.

Missing from Hacker’s account, however, is that when you get a jerk boss and you are five years from retirement, you are now forced to sit and take it or lose your permanent financial security. Also missing from the rosy story is that if both spouses work (something he laments and celebrates at the same time) and one gets the opportunity for a relocation, you now have a much bigger decision to make. Finally, Hacker ignores the accounts of the pension plans that have gone bankrupt or been significantly reduced because they were underfunded (in part due to changing assumptions for longevity, but also due to bad actuarial assumptions). In Hacker’s paradise, the risk seems reduced, but it merely makes the fall so much more stunning when the collapse cuts your supposedly guaranteed pension in half.

We can have a meaningful debate about the duties of a company (which may not exist by the time you retire) to permanently fund your future life, but the data to have that debate is missing from this book. Additionally, Hacker ignores the real benefits of individual retirement accounts, because of the mobility they provide. As someone who has changed careers several times, I appreciate having a retirement account that follows me rather than having wasted those years of accrued service.

For Hacker, people like me are waging a war against the rights of the poor to be protected because we see the benefits of portable retirement accounts, the ability to purchase insurance plans that cover the most likely risks for me and my family, and who see the benefit in allowing workers at all levels to keep more of their earnings. There are certainly those among fiscal conservatives who embody a more Randian individualism and think all risk should be individual. However, there are others (like myself) who think there is a place for pooling of risk, but that it need not be at the level envisioned by communism, democratic socialism, or lighter variations like those proposed in the so-called Great Society, New Deal, or the (not very green) Green New Deal.

What Hacker and others that urge greater government intrusion in life through more expansive redistribution programs is that a reduction in risk is typically coupled with a significant loss of potential. So, for example, a minimum of 15% of my lifetime earnings have already been assigned to the government’s preferred vision of a retirement plan through social security and FICA taxes (both my share and that deducted before my salary is offered by the company). If 15% of my productivity isn’t enough to satisfy Hacker, then how much of the reward of my labor should be dedicated to satisfying his need to avoid economic difficulty? Is 50% enough, or 75%? Or, should we shift to simply pooling our goods and then distributing the results according to government’s needs? Never mind that the progressive tax system already discourages me from being more productive because having the top end of my wages reduced by 50% through various state and federal taxes makes it not worth earning more. (Never mind the realization that for the first $388k a person earns, they make out like a bandit from Social security, but it becomes a rip off after that point.)

All of this is to say that a safety net a real need, especially in an industrial economy that draws people away from their families and has, as a discernable downside, the disruption of lifelong communities. However, some thought might go into being more efficient with the large portion of people’s wealth that is already taken for redistribution and reducing risk before we plan on taking a bigger chunk of the available resources to use according to the planners’ desires. Additionally, if books on important topics like The Great Risk Shift are to be taken seriously, then they ought to consider the existence of real arguments against their positions and the fact that there is no proposed solution that does not have obvious and likely downsides.

The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream, Second Edition

By Jacob S. Hacker

Buy on Amazon

NOTE: I received a gratis copy of this volume from the publisher with no expectation of a positive review.

Should Christians Pay Taxes?

As the ominous tax day approaches, the ethics of paying taxes seems like a timely topic. What should Christians think about paying taxes? Should we pay taxes if our government is doing things with the money we find morally objectionable? These are questions of growing significance.

Fortunately Scripture is not silent on this matter, and it provides us clear answers to the ethical questions about paying taxes.  Most helpful is the account of Jesus paying taxes, which is recorded in all three of the synoptic gospels (Matt 22:15–22; Mark 12:13–17; Luke 20:19–26), but there are other portions of Scripture in play, as well.

In the account of Mark 12:13–17, the Pharisees are attempting to trip Jesus up by questioning him about paying taxes to their religiously and socially hostile government. According to New Testament scholar Robert Stein, by asking this question, the Pharisees are putting Jesus in a dilemma. “If he answers yes, he will lose favor with the people, for they despise the Roman taxation. If he answers no, he will be advocating rebellion against Rome and force the Roman authorities to take immediate action against him.”[1] Jesus evades the religious leaders’ trap by demonstrating that their acceptance of the good provided by the Roman government, as evidenced by their possession of the coin which Jesus uses as an illustration, obliges them to pay taxes when they are required.[2]

The Romans had a history of oppression, including the violent suppression of a revolt in A.D. 6, which was started in reaction by the same tax in question in this passage.[3] Paying the tax was offensive to the people of Israel because the Roman tribute was used to fund their oppressor; the occupying nation who had committed the social and religious atrocity of killing worshippers in the process of performing their sacrifices (Luke 13:1) was being supported by this taxation. A radical faction of the people of Israel, the Zealots, would not pay the tax because it represented Caesar’s unjust rule over the nation.[4] Even among those who paid the tax, there was likely a deep seated resentment at the obligation to support their oppressors.

Jesus’ response to the question was, “Render to Caesar the things that are Caesar’s, and to God the things that are God’s.” (Mark 12:17, ESV) In other words, he was telling them to pay the tax in recognition of their obligation as subjects (not even citizens) of the Roman Empire. This message is consistent with Paul’s admonition to Romans to “Pay to all what is owed them,” including “taxes to whom taxes are owed.”  (Rom 13:7) It is also in line with Peter’s instructions to submit to authorities, including governments. (1 Pet 2:13)

We should keep in mind as we read these instructions in Scripture that the government that Jesus, Paul and Peter were subjected to was not friendly to godliness. These admonitions were written more than two centuries before the Roman government became friendly to Christianity, through Emperor Constantine’s public conversion. In contrast, all three men who commanded submission to the government died at the hands of the government.

So, the answer to the original questions about paying taxes when the government is misusing the money to support evil, even our own persecution, is that even then the payment is required. This is not, however, the end of the question.

In the United States in particular, but really in any democratically organized nation, citizens have a function in determining the use and appropriation of government funds. At the national level in our form of democracy, the input of the citizens in taxation consists of election of representatives and advocacy for just policies. At lower levels of government, particularly the local level, citizens have the right to directly vote on tax levies and municipal budgets. Submission to government by paying taxes does not rule out responsible advocacy to see tax policies changed.

Our submission to government is limited by our submission to God. In our obedience to the government, Calvin writes, we “must be particularly careful that it is not incompatible with obedience to him to whose will the wishes of all kings should be subject.”[5] However, based on the examples provided by Peter, Paul, and Jesus, paying taxes to an unpopular, pagan, and violent government does not result in sin.

Here are three conclusions we can draw from this discussion as tax season approaches and as political debates over the rate of taxation and use of appropriated funds continues:

1.      Everyone should pay their taxes in accordance with the laws of the land. Objecting to policies established by the government or the use of the government funds does not, according to Scripture, relieve the Christian of the duty to pay taxes. However, this does not mean that paying as much as possible in taxes is ethically required; using exemptions, deductions and credits in the tax code to reduce your tax bill is consistent with good stewardship.

2.      Participate in the political processes of the land to promote just uses of taxes.  Since we live in a context in which active engagement in the political processes is permitted under the law, we should be engaged in advocacy for uses of tax monies consistent with the Moral Law. In other words, we should politically resist attempts to use government funds to promote vices or punish virtues. This is inconsistent with the biblically recognized role of government, which is to “punish those who do evil and to praise those who do good.” (1 Pet 2:14, ESV).

3.      Be active in advocating for just forms of taxation. Again, our privilege in living in a democratically organized context gives us the ability to engage in open discussion and political activism regarding the tax code itself. We have to pay our taxes, but if we can change the tax code to make it more just, then that reflects submission to the government, as well. Reasonable, legal means of advocacy for changes to the law in order to promote the common good are well within the ethical bounds for Christians. We should work for laws that are just toward rich and poor alike, and that allow the government to punish evil and praise the good.

[1] Robert Stein, Mark, (Grand Rapids, Mich: Baker Academic, 2008), 542.

[2] Stein, Mark, 545–46.

[3] R. T. France, The Gospel of Mark, (Grand Rapids, Mich.: Eerdmans, 2002), 465

[4] William L. Lane, Mark, (Grand Rapids, Mich: Eerdmans, 1974), 423.

[5] John Calvin, Institutes of the Christian Religion, IV.20.32.