NCPA - National Center for Policy Analysis

A Property Right To One's Income Is A Myth, Some Say

May 1, 2002

A naive philosophy of ''everyday libertarianism'' infects American politics with a ''robust and compelling fantasy that we earn our income and the government takes some of it away from us,'' according to two professors of law and philosophy at New York University, Liam Murphy and Thomas Nagel. This popular myth ''results in widespread hostility to taxes, and a political advantage to those who campaign against them and attack the I.R.S.''

Say what? According to reviewer David Cay Johnston, the two academics argue in a their new book, "The Myth of Ownership," that debates over the distribution of tax cuts incorrectly assume people have a moral right to their pretax, or gross income. You thought you earned it; but it is not so:

  • In reality, they argue, ''individual citizens don't own anything except through laws that are enacted and enforced by the state.''
  • Without government there would be anarchy; since we would not have the pretax incomes we enjoy without government's protection, it is after-tax incomes that we are entitled to own.
  • People may argue that their gross incomes are just rewards for their work or willingness to take investment risks, but government policies distort the distribution of pretax incomes compared with what they might otherwise be in a libertarian world of voluntary contracts and no government.

The measure of justice and fairness in taxes, they emphasize, should be the outcomes of tax policy. That may require, for instance, taxing people with the same at incomes at different rates.

"Pretax incomes are presumed just, the authors posit, for the same reason slavery was once the law of the land: pervasiveness makes legal inventions appear to be natural law."

Source: David Cay Johnston, "'The Myth of Ownership': Challenging the Rhetoric of Tax Cutting," review of Liam Murphy and Thomas Nagel, The Myth of Ownership (New York: Oxford University Press, 2002), New York Times, April 21, 2002.


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