April 15th, tax day! (But not this year; this year, it’s Emancipation Day, which is worth observing if anything is.) And probably not coincidentally, the movie adaptation of Ayn Rand’s widely-loved and loathed novel “Atlas Shrugged” opens  at theatres nationwide. So what could be more appropriate and entertainingly polarising than a discussion of Ayn Rand’s views on taxation?
Rand was not an anarchist and believed in the possibility of a legitimate state, but did not believe in taxation. This left her in the odd and almost certainly untenable position of advocating a minimal state financed voluntarily. In her essay “Government Financing in a Free Society”, Rand wrote:
In a fully free society, taxation—or, to be exact, payment for governmental services—would be voluntary. Since the proper services of a government—the police, the armed forces, the law courts—are demonstrably needed by individual citizens and affect their interests directly, the citizens would (and should) be willing to pay for such services, as they pay for insurance. . .
The implausibility of voluntary-financed government notwithstanding, elements of Rand’s view remain profoundly appealing. For example:
The principle of voluntary government financing rests on the following premises: that the government is not the owner of the citizens’ income and, therefore, cannot hold a blank check on that income—that the nature of the proper governmental services must be constitutionally defined and delimited, leaving the government no power to enlarge the scope of its services at its own arbitrary discretion. Consequently, the principle of voluntary government financing regards the government as the servant, not the ruler, of the citizens—as an agent who must be paid for his services, not as a benefactor whose services are gratuitous, who dispenses something for nothing. . . .
The general view expressed here captures much of the reasonable moral core of the movement to restore and reinforce effective constitutional limits on government. Many Americans believe, not unreasonably, that far from acting always as an instrument that serves their interests, government often acts as if citizens’ lives and labour are instruments to the special interests that control government. Indeed, the principle embedded in Mr Obama’s budget speech, that tax increases are spending cuts, suggests the objectionable idea that all income is government-owned, which it then “spends” by choosing not to hoover it up in taxes. To object to this way of picturing the relationship between citizens, their property, and their government is not to deny that the infrastructure of security, property and law maintained by government is necessary for a well-functioning economy that generates good jobs and decent incomes. It is necessary. But that infrastructure is for us. We are not for financing it. And we certainly aren’t for financing whatever extraneous functions our continually mission-creeping government happens to have taken on. Necessary taxation is not theft. But there are margins at which taxation becomes difficult to distinguish from theft.
As Abraham Lincoln said so well, “The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves—in their separate, and individual capacities.” Citizens reasonably resent a government that milks them to feed programs that fail Lincoln’s test. The inevitable problem in a democracy is that we disagree about which programs those are. Some economists are fond of saying that “economics is not a morality play”, but like it or not, our attitudes toward taxation are inevitably laden with moral assumptions. It doesn’t help to ignore or casually dismiss them. It seems to me the quality and utility of our public discourse might improve were we to do a better job of making these assumptions explicit, and of seriously and respectfully considering whether our ideological opposites, be they socialists or “Atlas Shrugged” fans, might have one or two worthwhile points.