The Real Plan of the Far Left-Wing of the Democratic Party is Much Worse Than Just Taxing the Rich

Alexandria Ocasio-Cortez

By Dom Armentano

If you think that the “tax the rich”rhetoric from the left-wing of the Democratic Party is primarily about economics you would be sadly mistaken.  After all, there isn’t enough tax revenue in the highest income bracket, even with a 90% marginal rate, to fund anyone’s pet social program for more than 48 hours. Do progressives know this? Of course they do.

The same observation holds true for the so-called ”Green New Deal” legislation recently proposed by Alexandria Ocasio-Cortez, the outrageous media darling from Queens. It’s true that this grab bag of environmental regulation,  if enacted,  would likely cost trillions and produce a systemic change in the American life-style.  But you miss the deeper message if you think that the actual purpose of this legislative monstrosity is to save the planet before it expires in 12 years.

No, the current wave of extreme progressivism has a far more nefarious goal than simply higher taxes on the super-rich or carbon taxes to scrub down the environment.  Indeed, the long-run objective of the new socialists and the gang of social justice warriors (SJW) is to gradually delegitimize the very foundations of modern capitalism by obliterating conventional notions of property rights, fairness and justice.  If this sounds far-fetched you have not really been paying attention.

It is often assumed that capitalism is founded rock solid on economics.  Not necessarily.  Strictly speaking, economic considerations, though important, are secondary.  Instead,  it’s the relatively unique system of individual property rights that primarily legitimizes all capitalist institutions.

Take, for example, the most obvious and essential capitalist institution:  the private stock corporation.   It is solidly rooted in the notion that individuals have rights; that these rights include the right to incorporate;  the right to instruct managers of corporations to maximize profits; and the right of owners to sell their shares.  These individual rights (entitlements) are the “moral” foundation for the existence and operation of all modern business organizations.

This particular theory of property rights was made explicit in the 18th and 19th centuries by philosophers such as Adam Smith, John Locke and John Stuart Mill.  It holds generally that it is morally appropriate for individuals to own property including, of course, their own labor; to exclusively determine its use; and to enjoy the benefits (income or otherwise) earned from production or exchange.  Adam Smith, who taught “moral philosophy” (not economics) at Glasgow University in Scotland termed these rights “natural” and once famously observed that free markets and voluntary exchange were morally appropriate because they were “consistent with liberty and justice. ”

Modern progressives and socialists reject this classical approach to rights theory.  They hold, instead, that rights to property (and capitalist institutions such as the corporation) are arbitrary constructs of an elite and conservative legal system; that there is nothing “natural” or legitimate about them; and that, therefore, they have no special moral status. But if they have no special moral status, then neither does the income and privileges that these “rights” currently generate for owners. Indeed, government may now alter these arbitrary property arrangements and redistribute income and privileges to, say, anyone in the name of fairness and social justice.

It is now apparent  that this radically  different approach to property rights  can be employed  by critics to rationalize  higher taxes on the rich, a drastic reduction in CO2 emissions, an increase in  the legal minimum wage to $15/hour, and even the federally chartering of corporations (an Elizabeth Warren pet proposal) in order to make them “socially responsible.”  Indeed, there is almost no tax or regulation that cannot be justified from this perspective.  And that’s precisely the point.

In conclusion,  the social justice warriors and the new socialists are not primarily concerned with economics as such.  The tragic lessons of, say, Venezuela are not their concern. Instead, their objective is to continue to delegitimize the classical foundations of property rights and then implement, through legislation and the courts, a radically different theory of justice in social affairs.  Whether such a program will be successful has yet to be determined.

Dr. Armentano is professor emeritus in economics at the University of Hartford in Connecticut and the author of Antitrust: The Case for Repeal.

The above originally appeared at LewRockwell.com and is published here with permission of the author.

Copyright © 2019 Dom Armentano