Tax Cuts and Progressive Conservatism
Here’s the narrative: Cutting business taxes allows for higher profits, which fosters new investment and hiring. New hiring means more high-paying jobs. More high-paying jobs mean that even with reduced personal income tax rates, gross federal tax revenue will not be affected. Everybody wins: individuals are wealthier, and the government can still afford to pay for the entitlement behemoth.
That narrative, which has been the standard Republican Party argument for tax cuts (i.e., lower tax rates) for generations, is essentially true. When Republican lawmakers have the votes and the “courage” (more on that below) to follow through on some version of this narrative in practice, the economy grows, individuals feel more optimistic about their financial futures, and leftists twist themselves into intellectual pretzels in their attempts to prove that what is happening is not really happening.
And then what happens? Economic growth becomes the excuse for new entitlements, since even a boom economy can be accused of “leaving some people behind,” and of course no one wants that. To answer concerns of an increasing “wealth gap” or “a new underclass,” programs are introduced, or existing ones “enhanced,” to reduce income disparities or the social effects thereof. After all, if the economy is doing well, wouldn’t everyone like to think that no child will be left behind, that those with disadvantaged beginnings will be offered a head start, that groups who seem to have been discriminated against in the past will finally be allowed their full share of this new bounty? Doesn’t a strong economy mean that the wealthy have a little more to give in order to ensure that everyone who needs a hand up gets the boost he needs? Isn’t a happy society one in which everyone gets to share in the community’s boons and benefits?
At this point, the “Left” seeks to exploit such arguments to create a new sense of class warfare, while the “Right,” in defensive posture (since they are the faction associated with the expanding wealth produced in the growing economy), trips over itself trying to accommodate the demands of the “spread the wealth” crowd without sacrificing economic growth.
Thus, the usual Left-Right war of optics renews itself generation after generation. The Democrats are only asking the wealthy to sacrifice a little of their “unnecessary profits” for the well-being of the society as a whole. The Republicans are only asking not to sacrifice the trickle-down benefits that accrue to everyone when the economy as a whole is growing.
The premise that both sides share, and that allows this optics war to become an endless cycle in the form of a downward spiral, is the premise that has corrupted and finally destroyed the United States of America as a constitutional republic, as it has similarly destroyed any other nation that ever had pretenses of freedom before the rise of progressivism. That destructive premise: that it is the role of the federal government to orchestrate and provide for the general material well-being of the society.
When so-called conservative parties insist, as they invariably do, that their tax cut plans will be revenue neutral, in the manner described above, you can be sure those parties have sold out the principle of liberty in favor of the principle of winning elections, or at best the principle of economic growth as an ultimate good in itself. Revenue neutrality implies that the federal government’s current levels of revenue are defensible, desirable, and inherently worth maintaining.
But that is precisely what no one who really wished to espouse a principled conservative position would want to claim, or even appear to be claiming. The essence of the conservative case is not, or should not be, that a more economically beneficial tax policy is the best way to ensure the government can continue to meet its entitlement obligations, but rather that the federal government has no business having entitlement obligations, and that entitlements need to be slashed and burned, not tweaked or streamlined — and not primarily in the name of growth, but in the name of freedom.
Of course, it is impossible to make this case as long as one is tacitly accepting or kowtowing before the premise that the federal government is responsible for the general material well-being of the society. In other words, a quasi-conservative variant of progressivism is progressive all the same.
Canada’s present-day Conservative Party was a rechristened version of the country’s previous, longstanding “right wing” faction, which was literally named the Progressive Conservative Party. That old party name, though seemingly oxymoronic, was actually more truthful as a representation of what modern mainstream “conservatism” really amounts to in practice: the advocacy of market-oriented means of achieving socialistic ends. (The leading advocates of this perspective in Canada used to be aptly dubbed “Red Tories.”) It should not be difficult to see that once one accepts the basic social premise of the socialists — government control of the economy is required for the sake of the collective good — tax cuts and entitlement reform can never be a winning position without the reassurance that the benefits of these policy changes will ultimately achieve socialist goals more effectively than actual socialism could do it. So that is precisely the case “conservative” parties, such as today’s Republican Party, are invariably reduced to making.
“Revenue neutral,” as a rhetorical point or promise, means nothing but “Don’t worry, we don’t want to fundamentally change the relationship between the federal government and the private citizen, but only to make the whole progressive system work more efficiently, so that everyone gets more benefits than ever.”
A real conservative faction would not be ballyhooing tax cuts while carefully avoiding or obscuring significant entitlement “reform.” A real conservative faction would be shouting from the rooftops, “Spending cuts equal the shrinkage or elimination of federal entitlement programs, which equals a reduction in government control of your life, which equals more liberty. Oh, and as an additional benefit, reducing our authoritarian micromanagement of your life means we’ll also need less of your money in the form of confiscatory taxation, so we’ll be able to start reducing that gross infraction against your liberty as well.”
If any mainstream faction ever has the courage — the real courage — to present that case to the population, then you can get excited about voting again, because you will know that for once your vote is actually a meaningful expression of your desire to live in free society.
For the meantime, I guess Americans are supposed to get all excited about their tax cut, “It’s the economy, stupid,” “Make America great again,” and all that. Wahoo — a wealthier progressive collective! Welcome to China 2.0.
Sorry, I don’t like raining on parades, I really don’t. But I also don’t believe in calling rain sunshine just because it sounds nicer.