The Road Gets Steeper: On the Alleged Unfairness of Progressive Income Tax

     I've been having a lengthy and frustrating argument with a friend who seems to hold the position that progressive income tax is unfair. He seems to think it is punitive to impose a higher tax rate on someone just because they happen to earn more than someone else. And he's not alone in using words like "punitive"; lots of people are wrong along with him.

     Simply put, progressive income tax is where the marginal tax rate rises as income rises; as your income rises, you are taxed a progressively higher percentage. Simple enough, and simpler still if you just ignore the word "marginal", which is a common mistake, but turns an otherwise sensible policy into a horrifying injustice.
     Consider: You earn 10,000 quatloos, and are in the 10% tax bracket, so you pay 1000 quatloos in tax. But next year, you earn 10,100 quatloos, and that puts you into the 15% bracket, so perversely you end up paying 1515 quatloos, effectively losing money by earning more. That definitely would be punitive, because there's an actual disincentive to earn the extra quatloo.
     That's how many people think progressive income tax works, so they naturally find it objectionable. But that's what you get for ignoring the word "marginal". The way progressive taxation really works is that you only pay the higher rate on the income above what you earned in the lower bracket. So you pay 10% on the first 10,000 quatloos, and then when you earn an additional ("marginal", for the margin or gap between what you earned and the previous bracket) 100 quatloos, you pay 15% on the additional income, or 15 quatloos. So your total tax bill is now 1015 quatloos, not 1515. There is no point at which earning an extra quatloo costs you more than one quatloo in taxes; earning an extra quatloo always means taking home more money. Hence, it's not actually punitive; you're never actually worse off for having earned more, at least so far as taxes are concerned.

     I think my friend understands this much, but he still insists that it's unfair to make the rich pay a higher percentage of their income in taxes. I must confess I've really been having a hard time understanding this reasoning. It might come from an inappropriate emphasis on the word "equal", which doesn't necessarily mean "fair". After all, a straight head tax of $1000 per person per year would be equal in dollar terms, but impossibly burdensome on the poorest, and imperceptibly so on the richest. Obviously fairness does not demand arithmetic equality; why should we assume it would require equal percentage rates?
     But that seems to be the core of the objection: progressive income tax treats the rich and the poor differently. And I want to argue that it doesn't, at least, not in a discriminatory way.
     Think of it this way. You are moving along a road. Every meter you travel horizontally is a dollar in your pocket. Every vertical meter you ascend is a dollar in taxes. At first, the road is level, or even slopes gently downward (if you're receiving social assistance from the government, perhaps). But as you move farther along, it gradually begins to slope upward. After a hundred kilometers or so, you're heading up quite a noticeable grade, and in another thousand kilometres, it gets steeper yet. But it never becomes quite vertical; it's always possible to travel another meter horizontally, although you may need to climb more than a meter vertically to do so.
     Now, as you strain your way up the steepest part of the slope, you may cast a longing glance backwards at those lucky people ambling easily along the gentler rise behind you, and lament how unfair it is that they have an easier time than you. But is in unfair? Are those people enjoying some benefit or advantage that is denied to you?
     Of course not. You've already travelled that stretch of road. You just travelled it much faster. Perhaps you had a bicycle, or a car, that let you cover those kilometers so quickly, while they're jogging, walking, or even crawling. There is no advantage they have over you that you haven't already enjoyed. You might legitimately complain that the road is too steep for you here, and you might even decide to emigrate to a different country where the roads are flatter, but you are in absolutely no position to complain about unfairness.

     And so, likewise, with progressive income tax. The very rich are not being penalized by higher taxes any more than you, having already travelled the gentle slopes, are being penalized by a steeper hill. They have already earned and used up their Basic Personal Exemption, and paid the same low tax rate as everybody else on the first few tens of thousands they earned this year. It's just that the tax rate, like the road, gets steeper the farther you travel along the income axis.

     It's important to emphasize that in this argument, I'm not claiming that we should implement progressive (or more steeply progressive) taxes because it would be fair to do so. Rather, I am here attempting to refute the specific objection that progressive taxes are unfair, which once you understand the math, is not just wrong but almost incomprehensibly wrong.

All of the Above

     There is an old joke to the effect that anyone who would voluntarily run for public office should be automatically disqualified from doing so. It's easy to see why this has resonance with a lot of people, because the kind of person who seeks political power very often is exactly the kind of person who shouldn't get it.

     I have to admit I share this general prejudice, although for me it is directed more at political parties than individuals. I have a strong disdain for partisan organizations for a variety of reasons, and so when someone says, "They're all a bunch of crooks!" there's certainly a part of me that wants to shout "Amen!" And I certainly share the desire to wash my hands of the whole thing and just walk away from it.

     And so I am sympathetic to those who either decline to vote or who deliberately spoil their ballots in protest, as a way of saying “None of the above!”

     But here’s the problem: there is no “none of the above” option on the ballot, and practically speaking, abstaining or spoiling your ballot is identical in effect to voting “all of the above”. One of these disreputable nogoodniks will be elected; the only way you could possibly frustrate that by not voting is if absolutely nobody else votes, either, but the fact that there are candidates who have taken the time to get nominated and run means that at least they are probably going to be casting ballots. The one who ends up with the most votes will win, regardless of how tiny the actual number of votes might be, and the fewer votes cast, the easier it is to get the most. So, by not voting, you are in effect actually tacitly accepting whoever it is that eventually wins: you may not have voted for them, but you did not vote against them, either.

     There really is only one way to vote against a candidate, and that is to vote for a different one. To put it another way, if six zombies are attacking, you only get five bullets. (Also, in our first-past-the-post system, you don’t get to shoot twice at the same zombie.) There’s always going to be at least one you don’t shoot at; choosing not to vote just means you don’t shoot at any of them; you think you’re expressing your disgust for all the zombies equally, but really you’re making it easier for them.

     Which is another thing. A lot of people, in throwing up their hands in disgust, say “they’re all equally bad!” But that’s not actually true. There will almost always be some variation in degrees of badness, and saying they’re all the same works to the advantage the worst of them, and to the disadvantage of whoever might be marginally better than the rest. In other words, by treating the worst as if they’re as good as the best, there’s little incentive for anyone to improve. Remember: declining to cast a ballot is functionally identical to voting for everyone. 

     Now, you might think that I’m arguing in favor of voting here, and of course I really would prefer it if more people showed up to vote. But in fact, I really have nothing against your choice not to cast a ballot. By all means, abstain if you want, but only if you are really and truly indifferent to who eventually wins. 

A special kind of stupid

     I've often seen this quote, usually pasted over a picture of Sam Elliot:

“You actually think criminals will obey gun control laws? You’re a special kind of stupid, aren’t you?”

      Here we see a splendid example of the straw man fallacy. The straw man fallacy is when, instead of taking on your opponent’s actual position, you attack a harmless effigy of it. In this case, the claim is that proponents of gun control actually think that criminals will obey gun control laws, which is of course a stupid thing to expect. Ergo, proponents of gun control are “a special kind of stupid.” 

     Of course criminals won’t obey laws! But that’s actually kind of the point. Criminals tend to ignore laws, big and small, and they usually commit many more small crimes than big ones. That is, a person who commits major crimes tends to already have a lengthy criminal record of minor offences by the time they do something big. This fact can be used to help reduce crime in two main ways. 

     First, on someone’s first arrest for a minor crime, there are opportunities to set them on the right path so that they don’t reoffend. In Canada, judges can grant conditional discharges upon sentencing, ensuring that the accused will not have a criminal record if they complete a rehabilitative program or course or meet whatever other conditions are specified by the judge. Some of these programs actually have a pretty high success rate, meaning that people caught early for minor crimes rarely commit another one. And if someone is picked up for illegal possession of a firearm before they actually shoot someone with it, that’s actually a good thing.

     Second, there is parole. To many people it seems counterintuitive to let a dangerous criminal out on parole before the sentence is complete — they think he should serve his whole sentence! — but in fact it serves to help keep them off the streets longer if they are at all likely to reoffend. Parole means regularly checking in with a parole officer and keeping out of trouble; minor offences while on parole put you right back in jail, and for longer, because committing a minor offence while on parole is itself an additional offence with an additional sentence. Nobody really expects habitual criminals to obey their parole conditions. We hope they will, but if they don’t it’s actually a way to keep them locked up longer so they can’t commit more serious crimes.

     Gun control advocates, then, generally do not actually believe that criminals will obey gun control laws, and so the attacking that belief is attacking a straw man.

     Now, skewering a straw man doesn’t have any effect on an actual opponent, but it can still be an opportunity to show off one’s technique. But it can backfire if your technique is poor; unfortunately, in this case, the attack on the straw man demonstrates embarrassingly flawed reasoning. Consider: the argument seems to be that we shouldn’t have gun control laws because criminals don’t obey the law anyway. But that’s actually a pretty terrible argument. Should we not have laws against stealing? Against driving drunk? Against murder? After all, criminals won’t obey those laws.

    We have these laws, not because we expect criminals to obey them, but so we can do something about it if they don’t: we can punish them or force them to undergo rehabilitation or banish them or whatever it takes to reduce such behaviour.

     

     So do the authors of this kind of nonsense actually believe that their opponents expect criminals to obey the law? Do they actually believe there’s no point to passing laws that criminals will just break anyway? That’s two kinds of stupid right there.

Picking on Bullies

     Why is everyone always picking on bullies?

     Almost every day I see some earnest, well-meaning chain letter (it’s amazing how many Facebook status posts are actually chain letters) unironically urging me to “share if you’re against bullying!” I always find this amusing, because of course there is an element of bullying in that very message. But perhaps I should explain what I mean by “bullying”.

     Many people I talk to seem to think that bullying is simply a matter of coercion: Do as I say, or you will suffer. The threat need not be physical, of course; very often the threat is the implication that everyone will laugh at you and you’ll be an unpopular loser. While that’s often a part of bullying, I don’t think it’s sufficient. We might have other moral issues with a coercive ultimatum, but there are plenty of situations where we wouldn’t call it bullying. Standing up to a bully, for example, might well involve threatening violence, but it wouldn’t itself be called bullying. So what is it that marks a use of coercion as bullying?
     I think it is relevant that we often (though not always) describe bullies as cowardly. This suggests that bullying involves an element of bluff: the bully threatens a consequence he himself might actually fear to deliver on. But bluffing itself isn't necessarily cowardly, particularly when an underdog must project confidence to convince a more powerful opponent not to mess with her. So what is it about a bully’s bluff that differs from an ordinary bluff?

     What I've noticed is that the bluffs of bullies tend not to stand up to any serious scrutiny, and what's more, bullies often actively try to discourage their victims from looking too closely at what is threatened. I'd like to propose, then, the following theory of bullying.

     An act of bullying consists of an implicit or explicit coercive bluff, where the bully relies upon the victim's own failure to critically assess the credibility of the threat. 

     Now, a bluff is false by definition, so naturally any bluff will collapse under sufficient investigation, but a non-bullying bluff tends to assume the victim might perform at least bit of due diligence. Consider, for example, the scene in The Princess Bride where Wesley attempts to intimidate Prince Humperdinck into surrendering, and Prince Humperdinck actually accuses him of bluffing. Rather than denying it, Wesley explicitly acknowledges the possibility, but takes advantage of the fact that the Prince actually has no way, short of actually fighting him, to confirm his suspicion. Under my theory, Wesley’s bluff is not bullying, because his bluff is credible on its own merits, and while he exerts considerable effort to make it more credible (standing up and raising his sword takes all his strength), he does not at all attempt to dissuade Humperdinck from considering it critically. In a sense, Wesley’s bluff is honest, in that Wesley is encouraging Humperdinck to consider his next move carefully and calling his attention to a risk he may not have fully appreciated.
     In contrast, I argue that a bullying bluff is not just dishonest, but fundamentally disrespectful of the victim’s basic cognitive independence. Where the “honest” bluff presents evidence and trusts the victim to come to the desired conclusion, the bully presumes not only to present a threat, but to dictate its interpretation: “Pay no attention to the man behind the curtain!” Of course, the bully does not have any actual power here, because it is ultimately the victim who must make the assessment of the threat. So, in fact, the bully’s only power is that which is voluntarily ceded to him by the victim.
     So, if I threaten to beat you up at recess if you don’t give me your lunch money, that’s usually going to meet the criteria for bullying, because I don’t expect you to look very closely at my threat or the circumstances around it. If you did, you might consider that you could effectively neutralize it by telling the teacher. As a bully, I will expect you to reject that option out of hand because only crybaby losers do that. I might try to reinforce that assumption, taunting you as a crybaby loser if you threaten to tattle, but it’s actually your choice whether or not to give that any credence; if you don’t believe there’s any shame in reporting my extortion attempt to the authorities, then I am powerless.

     It gets a bit more complicated when the assumptions at play are more widely accepted (although the disdain for “snitches” isn’t exactly uncommon). Sometimes the assumption might actually be true, in which case the line between emotional bullying and moral suasion gets fairly blurry. Nobody wants to be a bad person, and if I say you’d be a bad person if you kicked that puppy, I might actually not be bluffing: you would be a bad person. But I also might not be bluffing if I say you’d be a bad person if you, say, approved of interracial marriage; I might genuinely (but wrongly) believe that. At what point does expression of a moral judgment become bullying?
     As with so many moral wrongs, the answer lies in intent. In this case, the intent isn’t so much an intent to bully (many bullies have no idea they’re bullies) but rather an intention with respect to the questioning of assumptions: an unwillingness to allow for any questioning is a key indicator of bullying. I would argue that this is so regardless of the truth value of the assumption itself; one can still be dogmatic about it to the point of bullying.
     By the time it gets to you, a chain letter has been stripped of any initial intention and is just a string of words that somehow induces people to copy it and send it on to others, so it's not really meaningful to talk about a bullying intention as such. But they can and often do employ bluffs based on assumptions you're not expected to question, and some of them do come across very much like bullying. One claim I see from time to time is "99% of people won't have the guts to share this!" which rings the bully bell loud and clear. But what happens if we pay a little attention to the idea that it takes "guts" to share a chain letter?
     As for "Share if you're against bullying!", it's a bit greyer. I suppose you could read it as a terse way of saying “If you’re against bullying, I encourage you to share this message.” But the plain reading is “IF you are against bullying, share it” with the logical implication that if you don’t share it, you’re not against bullying. Nobody wants to be thought of as in favour of bullying, so the choice it offers you appears to be between forwarding the message or supporting bullying. And that is, at least by my theory, what qualifies the message as itself bullying: it depends upon the reader’s failure to stop and challenge the preposterously shaky premise that failure to forward a chain letter indicates support for bullying.


     It is mildly amusing to observe that an ostensibly anti-bullying chain letter bullies people into forwarding it, but there is a more serious issue here. Remember that bullying depends for its power upon the victim’s own agreement to the offered assumption, and so it thrives wherever there is a tendency to accept offered assumptions uncritically. Yet the practice of questioning assumptions does not come naturally to people, and what’s more, there are social conventions that actively discourage such questioning as rude. (Bullies very frequently rely on their victims being too polite to challenge them.) Examining these assumptions isn’t necessarily difficult, but cultivating the habit of doing so takes some effort. We need to train ourselves to be alert to instances of bullying, to recognize when bullying tactics are being employed, even benignly. And that’s why I make a point of mentioning, when I see “share if you’re against bullying!” that I’m not sharing it precisely because I’m against bullying.