On Monday the Labour party announced that there were going to tax 45p in every pound of people who earn £80,000 or more per year. It is their method for attempting to ‘save’ the NHS, you can read about it in an article from the Independent here . Although I could dedicate a whole post to this proposal, I am using it as a way to into a discussion about taxes and the role they play in libertarian philosophy.
Robert Nozick argues for a limited ‘night watch’ style government, where by there is minimal interference from the state. Why does he argue for this? It is largely due to his account of property rights, and any interference from the government – in the way Labour are suggesting is a violation of these property rights. He would maintain that those people who are earning £80,000 are entitled to keep their money, and state intervention to take it away – no matter what the purpose is – is a violation of those individual’s rights to do what they will with their rightfully earned money.
Nozick notes in Anarchy, State and Utopia, that this will lead to circumstances that many people will find uncomfortable, however he maintains that just because something is unequal does not mean that it is unjust. The question then, is how does Nozick arrive at this conclusion?
Firstly he establishes his Entitlement Theory. The purpose of this theory is to show they ways in which property can be said to be legitimately obtained, and it contains these three premises
- Justice in acquisition
- Justice in transfer
- The principle of ratification of previous injustice
Principle one can be said to have been largely derived from the Lockean provision that you take what you need, but you make sure that you leave enough and as good for others. It also means that you can only take what was previously unowned. Lock bases his principle of aqucistion upon a religious backdrop, he suggests that everything on Earth is really God’s property, and by extension so are humans – therefore it follows that it is natural for human’s to gain property, because why would God have created it? Nozick shies away from this religious approach. He builds upon Lock in a different way – he talks of mixing your labour in order to enhance it or make it better in some way. If you have mixed your labour with it, as Locke says – but crucially for Nozick, you have made it better than it otherwise was then that property is rightfully yours. Nozick comes to this enhancing amendment because he sees an issue with Locke’s ‘mixing your labour’ criteria. Nozick questions, do you own the ocean if you pour some tomato juice into it? because of this concern he has tweaked the proviso to make it seem more intuitively valid.
G. A. Cohen explains that this is the basic starting position of a monopoly he provides the example of someone who comes along and takes a section of previously unowned beach. that new owner can charge entrance for the beach because they provided deckchairs and hire people to keep the sand free from rubbish. people will therefore pay for something which otherwise would be free. It is also possible to object further to this premise along a more general Marxist line and maintain that all property is theft. Although interesting these criticisms are are out of the scope of this post, as my intention is to show a Nozickian understanding of Labour’s proposed new tax policy.
Nozick is aware that in the modern world, most of the property as been acquired, therefore more focused is placed upon the second principle. the justice of transfer. The point of this principle is to argue for why a limited government is needed to ensure that property rights are not infringed. He makes that case that what arises from just steps is itself just. therefore for another person to come in and take what is yours is a violation of this justice.
The third principle is in place when 1 and 2 are not followed. it can be used to combat past historical injustice such as colonial times and also more contemporary crimes without the need to have a government – for example a way to show that fraud or muggings are morally bd because they violate principle 2, and therefore need to be rectified.
the upshot of Nozick’s entitlement theory is that it shows, for him, that any other sort of arrangement of money/property is unjust because it goest against his principles. Nozick calls his theory a historical one, because he is cornered with the process of how the current distribution of property and wealth came about, opposed to other approaches which are concerned wth making sure property and wealth is distributed according to a ‘pattern’ as Nozick calls it. Examples of patterns could be the Marxist doctrine of each according to his need… and so on and so on. In this case, he would be objecting to the pattern of taking the income of the best off in society and putting it into public services such as the NHS.
Now that I have outlined Nozick’s entitlement theory we are in a position to see how Nozick demonstrates its validity. He gives the famous example of the basketball player Wilt Chamberlain , however I will tweak the example to reflect the taxation policy proposed by the Labour party.
Imagine that the society that you are living in is arranged by a pattern of distribution that you consider to be correct. Call this D1.
In D1 people are huge fans of the football player Paul Pogba. Imagine that Pogba has it stipulated in his contract that he will only play for Manchester United if he is given £1 extra from everyone who comes into the football ground – this is done by people dropping the £1 into a collection bucket at the turnstiles.
Suppose that 1 million people go and watch Manchester United over the season. At the end of the season Pogba will have £1million extra. Thus we have moved away from D1, to a new distribution D2. D1 has been disrupted. Is Pogba entitled to his money? Nozick says yes, because it fits the principles of his entitlement theory.
Pogba’s extra £1million is therefore just even though D1 is no longer the distraction of your society, and more importantly for Nozick it would violate property rights to re-distribute Pogba’s money.
So, in relation to Labour’s tax preposed policy, all those who earn £80,000 (assuming they have done it legitimately) are all like Pogba, they have learned their money and the government would be unjust to tax 45p of very £1.
Of course, there are many ways to object to Nozicks entitlement theory and also his Wilt Chamberlain illustration, however this is the general argument. That taxation is a violation of property rights in the same way that denying Pogba his extra £1million is.