A fair tax?

January 11, 2008

Politics and economics are not my usual purview,  I generally leave them to experts such as our own political commentator, L.P. Mandrake.  However, since logic and the preservation of the liberal society generally fall under my blogging aegis, I had to comment on the recent brouhaha over Mike Huckabee’s “fair-tax” plan, which has been agitating the economics-blogging community.  While there had been piecemeal criticism and praise of this sales-tax plan thus far, when noted econo-contrarian Steven Landsburg wrote a fawning piece about it for Slate yesterday, things began to get a bit ugly. Without giving a full catalog of the back and forth blogging over the article, I refer you to this excellent summary of arguments against the Huckabee plan by Jonathan Chait.

You might ask why I bring this up in the first place. If you bother to read Yesterday’s Salad, you’re probably no stranger to blogging, and since L.P. Mandrake has been on hiatus, you’re even less likely to turn to us for analysis of emergent political issues.  However, there seems to be a logical issue with the plan that no one has mentioned yet, so here’s my brief attempt to suss it out (in non-syllogism form):

In brief, the Huckabee plan replaces the income tax with a nation-wide sales tax. To please the supply-siders, this encourages savings and particularly investment, because by not *spending* your money, it isn’t taxed (equivalent to an unlimited IRA).  To please the personal-responsibility proselytizers out there (that is to say, the folks who believe that economic misfortune comes only at the hands of irresponsibility and consuming beyond one’s means), the system actually penalizes consumption with taxes.  The TNR article linked above does a great job of dismantling the plan, giving solid reasons for why it is likely to cause more economic inequality, rather than less. However, from the two aforementioned perspectives (and countless others in the Conservative ideological rainbow) an increase in economic inequality isn’t the sort of thing that keeps you up at night, so the arguments will remain unconvincing, no matter how sound they may be.

So, here’s an argument that should appeal both to those seeking both a stronger economy and a more equal one: If we dramatically increase the sales tax, we would essentially be siphoning funds out of the economy.  One of the few upsides to the suffering dollar is that Europeans are visiting the U.S. in record numbers, and they are buying tremendous amounts of consumer goods. Apart from dramatically increasing the amount of German heard on Michigan Avenue, this provides a boost to our economy, essentially increasing the pie (or pot, depending on your preferred metaphor) from which we draw our unequal shares.  If their purchases were slapped with a dramatic sales tax (and to replace the income tax, it would have to be downright epic), visiting America and buying American would lose its appeal, even if the dollar remained weak.

Furthermore, a significant sales tax would also encourage wealthier Americans to spend outside of the country.  Save for some sort of extremely invasive customs process, this would both hurt our overall economy (by removing money from the system) and increase the amount of inequality in it (as traveling would allow the rich to sidestep the tax altogether).

Christopher Hitchens is a complex and oftentimes frustrating essayist. Possessing razor-sharp wit and precious little pity, Hitchens is most enjoyable when he is preoccupied with the shortcomings of one’s enemies, as in this delightful review. Yet, it can be cathartic to suffer his barbs when they hit closer to home. As an avowed fan of Winston Churchill, I found it challenging to read through Hitchens’ “The Medals of His Defeat,” an extremely critical analysis of Churchill’s legacy. However, in examining Churchill more critically, I found myself able to see more clearly why Churchill mattered (and still does). Unfortunately, while Churchill had the British public to keep his aggression and bombast in check after the war, no similar mechanism restrains Hitchens when he extends his rancor beyond his erudition.

Hitchens’ latest piece at Slate, “Bah, Hanukkah,” could be called a triumph of style over substance, but that might constitute a slight against the insubstantial. In this meandering essay, Hitchens attacks Hanukkah as a celebration of the “imposition of theocratic darkness” over the enlightened values of Hellenism, which “presented the world with the triumph of rational thought in the works of Plato and Aristotle, and rejoiced in the complexities of life presented in the theater of Aeschylus, Euripides and Aristophanes.” While it might be fun to entertain the idea that the bumpkin Maccabees fought a war of independence against the philosopher-kings of Plato’s Republic, this particularly Manichean view of history belies the complexities of the period.

The animus behind the Maccabean revolt can be seen through many complementary lenses, and just whom the revolt was against is similarly complex. The Maccabees represented a kind of religious traditionalism, in so far as they rejected the worship of Zeus as enforced by the Seleucid king Antiochus “Epiphanes” (“the shining one,” a decidedly religious sobriquet) and the Jews who supported him. However, at the same time that they fought these ostensible Hellenizers, the Maccabees themselves shared many of their cultural practices. So too, the Maccabees’ revolt can be seen as a class revolt; in an appropriately Trotskyist light, evidence suggests that the Maccabees’ forces came largely from the ranks of the disenfranchised, who saw the elite’s acquiescence to paganism as an unpardonable insult. The conflict can also be seen as an intra-religious one, between the priestly caste (and their sacrificial cult) and rank-and-file Jews, or as a fight between pre-Rabbinic and pro-sacrificial cults. (For a far more thorough and well-written discussion about the dynamics of Hellenism and Judaism, see Seth Schwartz’s excellent Imperialism and Jewish Society: 200 B.C.E. to 640 C.E.)

Hitchens also manages to goof up the traditional interpretation of Hanukkah. Rabbinic Judaism, the tradition that would later become the major Jewish movements of modern times, did not celebrate Hanukkah as a military triumph, instead choosing to celebrate the restoration of the Temple (particularly the clearing out of pagan paraphernalia) and the miracle of the Temple’s remaining supply of oil lasting for eight days. Furthermore the Rabbis had little love for the heirs of the Maccabean revolt, the Hasmoneans, both for their corrupt governance of Judea, and later for inspiring the traditionalist zealots of the Great Jewish Revolt Against Rome, who made life difficult for Rabbinic Jew and Roman alike.

Late in the piece, Hitchens makes some cursory remarks about the place of holiday symbols in public places. Unfortunately, whatever merit such a discussion might have, it is undercut by the most fatuous argument this holiday season, in which Hitchens blames the Maccabees, and by extension Hanukkah, for Christianity, anti-Semitism (for if there were no Christianity, Jews could not be called Christ-killers), Islam, and for retarding the development of humanity. Apart from the stark fact that Jews such as Philo continued to study Hellenistic philosophy (which Hitchens lionizes) throughout the times of the Hasmoneans, the works of the philosophers and cultural figures that Hitchens cites were Greeks of a prior era, not denizens of the Seleucid empire.

The tenuousness of the concatenation is far more ridiculous. If Judea and Judaism were totally absorbed into the Seleucid empire, Christianity and Islam might not have come about. However, who’s to say what might have replaced it? Certainly not a grand rationalism, were the Zeus-addled lieutenants of Antiochus to have prevailed. Perhaps worship of Antiochus would have flourished, or perhaps in the later years of Rome, the worship of Sol Invictus could have continued, unchecked by Christianity. Maybe, to warp a Sam Harris trope, today people might not be atheists in respect to Poseidon.

By the same logic, one might as well come out against celebration of the fourth of July. After all, the American colonists were mostly lower class, salt-of-the-earth types, who bristled at the idea that they owed taxes and devotion to a semi-divine king, rejecting the same culture that had already brought the world, the triumph of rational thought in the works of Hobbes and Locke, and rejoiced in the complexities of life presented in the theater of Shakespeare and Christopher Marlowe. And had those Puritan-loving colonists not revolted, the continent would be free of slavery (as England abolished it well before the United States), there would be no atomic bomb (as the first was an American effort), and not even an Osama bin Laden (as he was at one time supported by the United States).

To engage in another Hitchens-style “what-if” scenario, what would Hitchens’ piece have looked like if instead of being a Wikipedia-dependent anti-Hanukkah screed, it had been a specific rebuke to those Jews who do interpret of Hanukkah featuring “an Almighty with a special fondness for fundamentalists”? Or even just a screed about the continuing presence of religious symbols in public places? Atheists and religious moderates might both benefit, but it would interfere with Hitchens’ efforts to get a crucifix of his own.