Taxes and Civilization

He said it in a dissent in a case in 1927: “It is true, as indicated in the last cited case, that every exaction of money for an act is a discouragement to the extent of the payment required, but that which in its immediacy is a discouragement may be part of an encouragement when seen in its organic connection with the whole. Taxes are what we pay for civilized society, including the chance to insure.”

At the time he wrote that famous quote, the average pay in the US was around 3270 dollars a year. A married couple had an exemption of 3500 against the Federal income tax. Almost no one, except the comparatively rich, paid income tax. Holmes’ salary on the Supreme Court in 1927 was 9000 a year.  He would have paid a three percent federal income tax on 5500 of his income.  I think if he could be brought back Holmes would die of shock looking at current tax rates.

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MrsOpey
MrsOpey
Sunday, August 27, AD 2023 4:47am

Not only die at the amount, but at the waste and bloated govt now

Art Deco
Art Deco
Sunday, August 27, AD 2023 7:43am

There are four or five social functions which require the levy of taxes, though some agencies and government corporations also have fee-for-service income. What Mr. Annett is not acknowledging is as follows:

A. There’s a great deal of crookery in the architecture of taxation, consequent to the inclination of politicians to form patron-client relationships with rent-seeking commercial and industrial sectors who want a thumb on the scale to their advantage. (The initiative is commonly taken by pols and defended later by trade associations who have in house lobbyists and also hire firms staffed with former members of Congress and career-connections peddlers like the late Cokie Roberts’ late brother).

B. Compensation for public employees is often wretchedly opaque. On average, compensation for public employees is about 10% better than that for private sector employees, but you have knots of lard in there which are a scandal. School systems are particular loci for this.

C. Overstaffing and weak employee discipline are common in government offices. Everyone gets a taste of that contending with puttering postal clerks.

D. Public employment and grant money distribution sustains pseudo-professions and, short of that, a market for pseudo credentials which fancifully train people for actual professions. Some of the pseudo-professionals do things which are roughly socially useful, but they could learn to do these things on the job or in discrete certificate programs without the fiction that they are representatives of a guild. The most obvious sources of pseudo-credentialing are schools of ‘education’, ‘social work’, and ‘library science’. Social work, of course, is the most egregious pseudo-profession around. The American Library Association is a clown car.

E. Government will engage in direct provision and sector-specific cross-subsidy in circumstances where this is simply not socially beneficial. The most blatant example of this throughout the occidental world (and beyond) is public housing, housing subsidies, and regulatory efforts to redistribute utility from landlords to tenants. Other examples would be in the public utility sector (see South Africa for a disaster in the making) and in the grocery market (in the United States). Housing and meals are goods and services which appear naturally on the open market, which are replenished frequently and predictably and whose consumption does not require much in the way of prudently allocating purchases between time periods, whose consumption is sensitive to considerations of amenity, whose markets are competitive, and in regard product quality is not particularly opaque. Utilities’ services do not have all of these properties, but their consumption is roughly predictable and frequently replenished and their consumption is sensitive to considerations of amenity. You do not benefit from subsidies in these sectors.

F. Even in problem sectors where some sectoral subsidy or government provision is defensible, government policy consequent to the stupidity of our politicians will generate dysfunction and / or crowd out private providers completely. See, for example, the hopeless tangle of medical care finance in the United States for an example of the former or the higher education sector in Canada for an example the latter.

G. Government agencies and corporations have a tendency to turn into sandboxes for their employees, and our politicians do not do a thing about it. For two gruesome examples in this country, see the court system and the education system. Note, the corruption and dysfunction are often sustained by guilds.

H. It’s an amazement in our time the degree to which our politicians and elite administrators live in bubbles and recognize no kinship with anyone else who lives here. This extends to segments of the professional-managerial stratum, especially faculties. A great deal of this insulation is sustained by public employment and public subsidy.

CAG
CAG
Sunday, August 27, AD 2023 8:05am

The folks in San Francisco and Portland Oregon pay plenty in taxes … I think it would be a stretch to consider those to be civil societies.

The Bruised Optimist
The Bruised Optimist
Sunday, August 27, AD 2023 11:59am

“Three generations of idiots is enough”
Also Oliver Wendell Holmes. As those who have watched Judgement at Neuremburg may remember, this was part of Holmes endorsing forced sterilization. Maybe not the best source for an argument regarding civilized behavior, though no source shortly of Christ gets everything right.

But, let’s assume Holmes does have it right about taxation being essential for civilization. Food is essential to the body, but too much or too little food is greatly harmful to the body and will impede it’s proper functioning. So too with taxation. Our grossly overfed governments wallow along in dysfunction. The founders intended a much learner and healthier body politic. God willing, we can one day return to that!

Mary De Voe
Sunday, August 27, AD 2023 8:07pm

Oliver Wendel Holmes was an eugenicist. Given his way, Hitler would be outranked

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Monday, August 28, AD 2023 12:22am

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