If we taxed people based how hard they seem to be working, tax rates would have nothing to do with income. Our tax code that looked like a volatile day of stock trading, with a million rates at every income, depending on their perceived effort. I know this isn't what Cohn is suggesting, but it's the logical extension of the idea that we know how to align the effort, productivity and income of folks we've never met.
Cohn's second argument is that society and public institutions made the rich rich, and higher taxes should strengthen society and public institutions. I think this is right. A progressive tax code is the only way to pay for the infrastructure, services, and government we want, while providing low- and middle-income families with a decent standard living -- which is something we also want. If we didn't have the schools, roads, and basic means that an expensive government provides, we might have a poorer country with less opportunity and commerce and development.
But then Cohn quotes a provocative passage from Gar Alperovitz and Lew Daly's 2008 book, Unjust Desserts that makes things personal again:
Warren Buffett, one of the wealthiest men in the nation, is worth over
$60 billion. Does he "deserve" all this money? Why? Did he work so much
harder than everyone else? Did he create something so extraordinary
that no one else could have created? Ask Buffett himself and he will
tell you that personally he thinks that "society is responsible for a
very significant percentage of what I've earned."
I feel queasy, because we're back to critiquing the tax code with a person-by-person inquiry into what rich people deserve. The tax code isn't supposed to be a personal evaluation of each person's productivity. That's what compensation is for.
We should want a tax code that is pro-growth, that aligns incentives, that pays for the promises we've made, and builds the country we want. A progressive tax code is the most efficient way to collect enough money to provide rich services without impoverishing millions of people who enjoy those services. Higher taxes for the rich are justified because life costs more for the poor. As Adam Smith put it:
The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
That just about sums it up for me. Once we start getting into arguments about rich people we don't know being inherently undeserving of their income, I'm worried that liberals are starting a debate they can't win.