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How to build a state or Why should the rich pay higher taxes?

Updated on September 30, 2011


The first thing you will need is the social contract theory. There are many versions of this theory but all of them have one thing in common and that is the idea that citizens give up a small amount of their freedom to the state in order to get the benefits of living in a society. Most people accept this premise and for them this is enough to justify the existence of government but there are people who question it. To address these people we will move on to step two.


Argument 1: "It is impossible for an individual to give up a portion of freedom to the state. Freedom by definition is absolute and giving up any freedom results in a complete loss of freedom."

I question this premise. I don’t think that freedom is absolute. Free speech is important but it is not absolute. Right to property is important but it is not absolute. I need an example.

Example: “Suppose I gave you complete control of one of my fingers. Since my finger is attached to the rest of my body you would have indirect control of everything else.”

This example works but how about I change it? What if an individual sacrificed one hour of their day to the government? Wouldn’t this make them completely free the rest of the time?

Example: “Not if that one hour was so hellish and strenuous a burden that it takes undue time to recover from it and that I must spend the other hours of my day agonizing over that hour.”

I agree with this objection. I think if we take these objections into account we can come up with a good rule that protects personal freedom in society.


RULE 1: In order for the government to be able to demand a sacrifice from an individual it must be a sacrifice that a reasonable person might consent to regardless of their personal benefit or burden from this sacrifice.

This rule if a perfectly good rule, I think. Still, by itself it doesn’t clarify much and more rules may be needed in order to ensure that liberty is protected and that we can define the terms of the first rule. We can obviously say that the government cannot do things like kill people and harvest their organs to give to sick people. But there needs to be more definition in order to address less extreme cases.


Argument 2: "This rule is not sufficient. Any sacrifice to the state must be explicitly voluntary."

This is an example of the argument given against taxation and against progressive taxation specifically. It can be put into a logically sound argument even though I reject the premise but let us do it.

1. Any sacrifice to the state must be voluntary. (S if and only if V)
2. Taxation is a sacrifice to the state. (T equals S)
3. Therefore, taxation must be voluntary. (T if and only if V)

There is a problem with this premise though because I can then make this argument:

1. If a highway is constructed more people will die in the area it is built. (If H than D)
2. These deaths are sacrifices to the state which must be voluntary. (D if and only if V)
3. A highway can only be built if the deaths are voluntary. (Not H if not V)
4. There is no way that these deaths can be voluntary. (Not V)
5. Therefore, the state has no authority to build a highway.( Not H)

I am about to make a controversial statement. I am going to say that dying so that people can get to work or the mall faster is a much greater sacrifice than being taxed. (I know, crazy isn’t it?) We need a way out of this and because I am aware of the differences between the two examples, I think the next argument will give us one.


Argument 3: "Only a sacrifice to the state that is directly applied to an individual because of a specific trait, such as making more money, has to be voluntary. An act that is a sacrifice to the state that is merely a side effect of government action and not directly applied can be done without voluntary consent."

This solution seems clever doesn’t it? But what if we change taxation to conform with the highway example? What if instead of taxing everybody and certain people more we set up a random lottery every time the government decides to do something and the people picked by the lottery must pay the tax while everybody else reaps the benefit? If you are wealthy you may not like paying the tax but it probably won’t hurt you as much as the people who die on the highway. If you are poor it might take everything you have and destroy your personal freedom.

An easy way to reject this example is to give up the claim that a sacrifice to the state must be explicitly voluntary and simply accept rule number 1 that I have already laid out and to add rule number two.

RULE 2: A sacrifice to the state can be implicitly voluntary

This second rule fixes everything. The people who die on the highway submit to the chance they may die by driving on the highway. But there are still people who claim that they do not implicitly submit to taxation. In order to satisfy these people I will add a third rule.

RULE 3: If a sacrifice to the state is deemed necessary it must be implemented in the MOST FAIR option that is available to the state in which to implement it.


Okay, our three rules still apply:

RULE 1: In order for the government to be able to demand a sacrifice from an individual it must be a sacrifice that a reasonable person might consent to regardless of their personal benefit or burden from this sacrifice.
RULE 2: A sacrifice to the state can be implicitly voluntary.
RULE 3: If a sacrifice to the state is deemed necessary it must be implemented in the MOST FAIR option that is available to the state in which to implement it.

I like these three rules and I think that those alone are enough to resolve the issue between liberty and egalitarianism. I do not expect there will be no dissent on this point.

Objection to rule 1: "By what criteria are we judging a sacrifice that a reasonable person could consent to? If no such criteria can be established then rule one is invalid."
Objection to rule 2: "I receive no benefits from the government and use no government services and therefore, I do not implicitly consent and taxation is invalid. "
Objection to rule 3: "Progressive taxation is not the most fair way to tax. A flat tax is more fair and a sales tax is even more fair."

I can probably address all three of these objections with two examples of people living in the United States.

Spencer makes 30,000 dollars a year selling women’s handbags. His federal income tax is 10,000 dollars and he gets a chunk of it back as a tax refund. For that money he gets military defense, roads to drive on, police protection. If Spencer wanted to he could also take advantage of state funded Universities, student loans and grants, public libraries and all kinds of other aid that greatly increases his social mobility and therefore his freedom. Instead of taking advantage of these things Spencer sits at home writing forum posts about how the government, women and certain minorities are oppressing his freedom.

Lisa is a CEO who makes 5 million dollars a year. The federal government taxes her at a much higher rate than average and she pays 2 million in income tax and receives no refund. She gets all the things that Spencer gets in the first category but there are a lot of things that she does not need that the government provides for other people. Lisa was the child of rich Harvard alums and went to school at Harvard fully funded. When her parents die she will inherit an estate worth 50 million dollars and the government will take half of that leaving her with 25 million dollars.

Of these two people which one is MORE free?


Defense of Rule #1
Philosopher John Rawls came up with a concept of the “original position” in his book A Theory of Justice. That is where I completely stole rule #1. Rawls asks the question: if people had no knowledge of any of their talents or where they would start in life or any other factors such as race or gender, what kind of society would they chose? Let me ask it more like this. You have died and gone to heaven. God says that you are to be reincarnated as one of these two people. If somebody wanted to make the case that they are both equally free I could see it but if I had to choose one I would say Lisa is more free than Spencer is despite the “oppression” the state inflicts on her.

Defense of rule #2
Nobody does not benefit from the government and from taxation, period. Even if you are obscenely rich you get something and even things that don’t benefit you directly still benefit you indirectly. State schools and other social programs at the very least give you happier and more fulfilled employees which will make you more money.

Defense of Rule #3
This is probably the rule that can most easily be used to question progressive taxation and I intentionally added it just to be fair. But if we look at Lisa and Spencer, Lisa does indeed seem more free. That’s even with progressive taxation. If we implement a flat tax we may have to cut things that would benefit people like Spencer and his choice to sit in his house and write forum posts wouldn’t be a choice anymore it would be the only option open to him. If income tax was replaced with sales tax it would benefit Lisa more because she no longer would have to pay taxes on any money she invests and makes a profit on and because she would need to spend a smaller percentage of her income than Spencer to live it would not affect her freedom but it would decrease his. This is why progressive taxation is the most fair system.


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    • profile image


      3 years ago

      The author fails to make more than one relevant distinction, that had he made but one would have collapsed his argument justifying the redistribution-of-wealth racket leftists are hell-bent to keep on running for the benefit of their voting constituencies of nonwhites, nonmales, and the poor, the very three types that the Founding Fathers of America were rightly afraid would support the Old World notion of government as a paternalistic entity passing out social and economic goodies like candy to an infantilized citizenry, themselves, and so refused to grant them the privilege of exercisig the voting franchise in order to wisely limit their political influence. The left-leaning voting record of these three types validates the Founders' low opinion of them.

      What are those distinctions that the author and his leftist ilk typically fail to make? I'm not going to hold the author's hand. So, let him guess, not that he's capable of doing.

      I have written a point by point refutation of the above article, which focused not so much on morality, not on moral claims aka rights, but more on expediencies, e.g., how much will a man tolerate of his property being extorted by a government hell-bent to pay off the debts incurred by the redistribution-of-wealth racket being run today for the benefit of the Left's voting constituencies before he's disguntled? So, this is what the Left has come to, is it?

    • profile image


      4 years ago

      Social contract theories are nonsense. No one can offer even one historical example of a government that came into existence by way of all persons concerned mutually agreeing upon the terms of a social contract. Arguments for "tacit" agreement to a social contract are just as nonsensical.

      One need only examine history to see that governments form when a group of people consumed by a desire to rule all persons within a given territory are willing and able to kill the majority of people (both peaceful and aggressive) in the territory who refuse to submit to the group's domination. The group then holds pompous formal ceremonies, codifies its threats and calls this law, and invents fictitious titles to designate different levels of coercive authority for its members. Every government's power to rule rests on its threat of mass killing, including killing people who are no threat to anyone.

      What is "fair" or "reasonable" is purely subjective, so your "rules" simply amount to your own personal preferences and cannot be logically argued to be any better or worse than any other person's subjective personal preferences concerning what amounts to an equitable state of affairs in society. Rawl's theory of justice cannot be logically demonstrated to be any more just, moral, reasonable, or fair than Ragnar Redbeard's argument that might is right.

      Using the Merriam-Webster's Dictionary definition of freedom, the concept only makes sense in a political context when it applies to an absence of coercion. You're attempting to evaluate Spencer and Lisa's freedom according to subjectively valued objects or opportunities that are available to them, but this is an incorrect application of the word freedom as it is commonly defined.

    • profile image

      Dave Francis 

      9 years ago

      Great post. I just got on here but was immediately drawn to your writing. I took a theory course that began with Foucault, the middle was a complete deconstruction of the enlightenment and the climax was Rawls's book. It was a very interesting way to discover the philosophical basis behind liberal government as opposed to the historical perspective normally fed to government students.

    • martycraigs profile image


      9 years ago

      Great post, definitely an interesting and informative read

    • profile image


      9 years ago

      Interesting hub. Corporations are in business to make profits. Tax is one of the corporations expenses. When they are pricing their products, they factor all of their expenses into their selling price. So, in effect, a tax is not a corporate burden. And, it's a phony argument that corporate taxes lead to less jobs. As a long as a corporation can make a profit and grow, the corporation will create jobs.

    • Robephiles profile imageAUTHOR


      9 years ago

      Many people just have a very simplistic idea of what freedom means. Also I find that many people don't understand what "marginal tax rate" means. Even if you taxed people who made 3 million or more at 90% they would still be insanely rich. A lot of people think that means you take 90% of their total income instead of 90% over the top bracket. It is partially the media's fault.

    • RandomThoughts... profile image


      9 years ago from Washington

      I just love reading the rational on taxing the rich. It has become so outrageous that I don't see how even the right can't see it. It has to come to a head soon. This makes me want to copy your hub and hand it out on a street corner. Unfortunately, I don't know how many care or would take the time to read it or understand it. Thanks for the info. Very useful/up

    • hazelbrown profile image


      9 years ago from Central PA

      Nice post, and I completely agree! It drives me batty when conservatives object to taxation "on principle." You can't NOT tax corporations or the extremely wealthy just because you think raising taxes is bad "on principle." Like you, I need examples. How will taxing the wealthy and corporations REALLY hurt them (and the rest of us)? Is it true that if you tax the "job creators" then they won't create jobs? I'm pretty sure this argument has been proven to be completely wrong. Thanks!!

    • htodd profile image


      9 years ago from United States

      Great post.Thanks

    • Robephiles profile imageAUTHOR


      10 years ago

      Thanks for your comment. I wrote a version of this as an academic paper a few years ago and it was always one of my favorite papers of mine so I thought it might make a nice hub. If everybody would read John Rawls I think we would be a lot better off as a country.

    • profile image

      Howard Schneider 

      10 years ago from Parsippany, New Jersey

      Excellent defense of progressive government Robephiles. You're not going to be a hero to the Far Right or the Tea Party. Our government and most governments are created for the welfare of all of the people. Everyone must sacrifice and do their part. The rich have more so they sacrifice a larger percentage but are still left with much. There is so much greed and individualist nonsense going on in this country now. Laissez faire on steroids.


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