Elizabeth Warren’s “Must-See” Quote

Given the drive by influential political action group MoveOn.org to help “every American” see this quote by Senate hopeful Elizabeth Warren, it isn’t surprising that I’ve seen it cropping up on Facebook and Twitter quite a bit lately. In case you haven’t already seen it, here it is (source):

It’s easy to see why this quote has become so popular among political progressives. For those inclined to favor higher tax rates for higher wage earners, this line of reasoning sounds like the ultimate “gotcha” for their economically conservative foes.

Much of what she says here is true, after all. Our economy does rely on interdependence. No one does get rich totally on their own. We are blessed to live in a country with access to good roads, and without danger from “marauding bands”.

But there are also some major flaws in her logic; some of them are subtle, while others ought to be blatantly obvious, even to those who are predisposed to agree with her conclusions. Let’s start with the easy ones.

Public Services

Yes, we all pay for roads, as well as police and fire departments. Yes, those who “built a factory out there” require these roads to move their products to market, and benefit from the protection of “police forces and fire forces”.

Here’s the thing, though. Every citizen of this country has, by virtue of citizenship, equal access to these services. The guy who didn’t build a factory has the same access as the guy who did… but only one of them actually built the factory. What is it about the existence of public services that entitles the guy who hasn’t capitalized on the access to those services to a share of the profits from the guy who has?

It would be one thing if everyone had paid an equal share of the cost of public services, but that’s not the case. Under nearly every type of tax code imaginable — including the progressive income tax favored by Ms. Warren, and the “fair tax” advocated by many conservatives — the guy with the factory is paying a much larger share of the cost of those services. If anything, it seems that those of us who reap the benefits of public services while paying very little for them ought to be thankful for the successful folks who provide them for us!

Just think of the outrage that would be provoked if those who pay the bulk of the cost of our roads and emergency services began demanding that access to those services be proportional to what one has paid for them! But they don’t do that. In fact, most very successful businesses do employ their own private security forces (though Warren says they “didn’t have to”) because the protection they receive from public police forces is often not sufficient.

Education

Warren includes education alongside roads and emergency services as something which entitles the public to a larger share of the proceeds from private ventures, but are those things all truly equal? Unlike fire and police forces and public services, not everyone partakes of government education (though we all have to pay for it). The work force includes those educated privately, as well as those educated in foreign countries. The guy with the factory can (for now) hire whoever he wants (though he can’t pay them whatever he wants). Now, if public education produces the very best workers available for the best jobs, then those educated with tax dollars will earn their “fair share” on the merits of their desirability in the work force. If that’s not happening, then maybe we aren’t getting what we’re paying for with our education tax dollars…

Marauding Bands

I find it a bit ironic that Ms. Warren uses the lack of marauding bands as a reason the factory owner ought to pay even more taxes than he already does. What is her description of a “marauding band”, I wonder? From her usage, it would seem that such a group would consist of a number of people who hadn’t worked in the factory showing up at the factory and telling the factory owner that he had no choice but to give them what he had worked for.

Does it make a difference if that group is called the Internal Revenue “Service”?

The Great Unspoken

Now we come to the largest problem in Ms. Warren’s statement. Her whole argument seems to hinge on “the underlying social contract”. But what is this contract? She doesn’t say.

Of course, it is possible that she is referring to Social Contract Theory, which does, to an extent, underlie much of the writing in our nation’s founding documents; most notably John Locke’s thoughts on Natural Law influencing the Declaration of Independence. But I think she would be hard-pressed to show that Locke (or America’s Founding Fathers) had in mind anything close to the level of government interference and taxation that Warren envisions when contemplating this theory.

If Warren’s “underlying social contract” means — as it seems to — that all citizens are entitled to a share of the benefits of others’ labor, then she is guilty of circular reasoning. She assumes the point she is trying to prove.

For all her talk of clarity, she has really said nothing. We are back where we started. Those who share her prior assumptions about politics and economics are certain she’s said something impressive, but there is nothing at all constructive in this “must-see” quote. To pass it around the Internet as if it will suddenly convince “every American” of the validity of the progressive income tax is simply naïve.

But what else should we expect from the folks at MoveOn?

3 comments on “Elizabeth Warren’s “Must-See” Quote

  1. Very interesting and thoughtful. There is a concept called “Noblesse Oblige” which which even predates our founding fathers, it means Nobility Obligated, obligated to those less fortunate. Ms. Warren carries her idea to the extreme, and there can be no winners in her race. Allow me to make a proposal of sorts. I am a Progressive, I don’t accept the Liberal philosophy of tax and spend. Nor, do I accept the fallacy that the rich, or corporate America are exempt from their responsibilities to the economic strength of this nation. Assuming that the hourly worker can carry the tax burden of this nation is beyond pale. We, must first go completely through the budget and cut waste and funds from programs and departments that have the least impact on people. Having said that, I would eliminate Social Security funds from dependent members who did not pay into it, or were not spouses of the payee. I would eliminate payment to dependent children for education unless the father or mother was not alive. Another example of managing entitlements would be to audit recipients and those healthy enough for work would be required to participate in a work program which beneficial to the community. While cutting the spending we must raise some taxes on corporations and businesses. The Republicans need to give their mantra of no taxes a hiatus. The Progressive Tax is not simple nor is it fair. I believe we could accomplish a lot more by allowing economists to put together a financial plan for this country without all the political liabilities. My ideas on the budget are contrary to both liberal and conservatives, a Progressive should a person who is not afraid of compromise, not beholding to an ideology, and can see the benefits of all points of view. Liberalism and Conservatism of the 20th Century and the early 21st Century need to be reevaluated for their effectiveness, viability, and sustainability. Both political parties need reevaluation. Ms. Warren needs a broader education.

    I maintain 2 blogs and you are welcome to view and comment on either. They are yumaprogressive.wordpress.com and madisonsrepublic.com

    • John Gardner says:

      Thanks for commenting! In many ways, we are agreed.

      A few comments in reply:

      I’m familiar with the concept of Noblesse Oblige, but haven’t read a whole lot on it. My understanding was that it had more to do with philanthropy than with taxation, though. There’s a world of difference between a philosophical sense of moral obligation to sacrifice in order to help the “less fortunate” through gifts and service, and a legal obligation to sacrifice, imposed by coercion through tax laws.

      You are correct that the hourly worker cannot carry the tax burden of this country, but the point isn’t that the rich are obligated to carry the burden. It is, as you suggest, that the burden is too heavy! We are a nation living beyond its means, and no amount of taxation is going to make up for reckless, out-of-control spending.

      I hope I haven’t suggested that “the rich, or corporate America are exempt from their responsibilities to the economic strength of this nation”. I just think that we need to do a better job of defining what those responsibilities are. Everybody has a different idea about what constitutes someone else’s “fair share”. Our tax system is in need of a total overhaul, which includes closing loopholes and prosecuting tax evasion, but I believe that if the budget were trimmed to what we can actually afford, then there would be no need to raise taxes for anyone. Easier said than done, of course!

  2. […] to Warren). So rather than respond directly to Obama’s quote, let me refer you instead to what I wrote in response to Elizabeth Warren last September, which pretty much all applies to the latest rhetoric from the […]

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