Government Officials Want You to Know that Your Earnings Belong to Them
By Robert Higgs • Wednesday December 28, 2011 7:39 PM PDT • 28 Comments
Elizabeth Warren, the Democratic candidate for the U.S. Senate in Massachusetts, recently created a media flap when she said:
There is nobody in this country who got rich on his own. Nobody. You built a factory out there—good for you!
But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did. Now look, you built a factory and it turned into something terrific, or a great idea—God bless. Keep a big hunk of it.
But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.
Conservatives and libertarians took offense at Warren’s claim that the government has a superior claim to “a hunk” of people’s earnings merely because every individual lives in and benefits from a society to whose creation many other people have contributed.
The critics might well have been grateful for small blessings, however. Warren was prepared, rhetorically at least, to let people keep “a big hunk” of their earnings.
U.S. government officials in earlier times were sometimes unwilling to admit that people had a right to retain any of their earnings, and forthright in their declarations that everything people possessed really belonged to the government.
Striking examples of such views may be found in the recently published book by Burton Folsom and Anita Folsom, FDR Goes to War. There the Folsoms present a meaty discussion of the congressional debate that occurred in 1943 in regard to bills eventually enacted in compromise form as the Current Tax Payment Act of 1943—the statute that, among other things, established income-tax withholding at the source. In that debate, the following statements were made in Congress:
Rep. Emanuel Celler (D-N.Y.)—The government can at any time make income taxes as thumping big as the necessities of war require. Thus, if any plan does not raise enough money, taxes can at any time be increased. The government always has a moral if not actual lien on all our income. (p. 200, emphasis added)
Sen. Happy Chandler (D-Ky.)—[A]ll of us owe the government; we owe it for everything we have—and that is the basis of obligation—and the government can take everything we have if the government needs it. . . . The government can assert its right to have all the taxes it needs for any purpose, either now or at any time in the future. (p. 200, emphasis added)
Rep. Wilbur Mills (D-Ark.)—The public, with money in its pockets, will inevitably try to use this money to buy what it wants, what it may need. . . . [T]o check the forces making for inflation, we must direct our tax policy toward diverting an ever larger part of the funds of persons above subsistence levels into the Public Treasury. (p. 201, emphasis added)
So, lighten up, small-government friends. Be grateful that you must contend only with Warren, and not with the likes of Celler, Chandler, and Mills. Maybe there is progress after all.
Tags: American History, Books, Budget and Tax Policy, Morality, Politics, Property Rights, Taxation, The State, War 
Thanks to FDR, instead of Martin, Barton and Fish, we got Celler, Chandler and Mills. Now, that’s a New Deal!
Stephen Colley | Dec 28, 2011 | Reply
If you look at things objectively,and study history,you’d find that all Ten Planks to The Communist Manifesto have been woven,in one way or another,into the American fabric. Income Taxes,Inheritance Taxes,a central monopoly on the issuance of money and credit etc.,etc. were all envisioned by Karl Marx. In the end, property rights and the right to the fruits of one’s labor have been compromised. The end result has been the degradation of the American citizen from a sovereign to one of a serf. Your serf number is your Social Security number. It took over a century of time to accomplish this situation. At various points in time futile efforts were made by American citizens,inside and outside of government,to stop the slide into collectivist serfdom. Many patriotic Americans were financially destroyed and even incarcerated for challenging the Constitutionality and legality of Income Taxes. In most cases their efforts were ignored or ridiculed by the general public who now,after decades of tax serfdom are finally waking up to the fact that they don’t own the “fruits of their labor.” Once people concede that the government has the “right” to take a portion of what they earn then it becomes a matter of “how much.” Instead,people rely on “tax advisers” and accountants to minimize their tax liabilities. What people don’t realize is that many of the citizens who complain about high taxes were the same jurors that would convict people of “tax crimes” because they believed that these same patriotic citizens who were standing up to the State weren’t paying their “fair share.” Over 50 years ago,in a visit to America, Nikita Kruschev stated that”America would one day become a Communist country and that the American people would vote into office its Communist leaders.” At the time, many people in the American Press who were covering Kruschev’s visit laughed at him for saying such a thing. But after more than half a Century of time it seems that old Nikita may have had the last laugh.
Libertarian Jerry | Dec 29, 2011 | Reply
I would like to ask two questions of Ms. Warren.
1. Would you be willing to restrict government only to the services you listed, with the proviso that the last marauding band of foreigners was the British in 1814?
2. Which level of government provides the services which you defend?
3. How do you defend other government activities which we pay for with taxes?
Robert Jackson | Dec 29, 2011 | Reply
I do not acknowledge the legitimacy of bullying in any form, at any time. I do not support it. Prisons were made for men like me.
JosephHuntington | Dec 29, 2011 | Reply
Simply put, they want all your money. They spend and spend and want more and more. It’s time to throw they sob’s out. Its time to elect a pres, a congress and senate that will abolish a large portion of useless gov. agencies, starting with homeland control, epa, dept of labor, education and others could go. I’m sick and tired of the arrogance of those running our gov. Our gov. is supposed to serve the people, not the other way around.
mike | Dec 29, 2011 | Reply
Elizabeth... The person who opened a “factory” and “used those roads” PAID for them too lady!!
AND paid taxes to educate everyone else’s children even if they didn’t have children or children who attend public schools.
We are not socialists... get over it or move.
Diane | Dec 29, 2011 | Reply
Yes.
Knude | Dec 29, 2011 | Reply
Wow. This sordid attack on the basic notion of property rights calls to mind images from Atlas Shrugged, where government officials gloated over their looting schemes. This offends me as a human being.
Tyler Staggs | Dec 29, 2011 | Reply
Hahaha! Wilbur Mills said that? Remember, back in the 70s, Wilbur was the House Ways and Means chair who had an acute problem; mixing alcohol with prostitutes. A lush after tush.
Timothy | Dec 29, 2011 | Reply
This woman is talking from the collective.
Like Nancy Pelosi she took the Red pill & the Blue pill.
Paul in CA | Dec 29, 2011 | Reply
Well now I finally get it. We serve the government; we are their slaves. Up to recently I thought the government was to serve the pople. Silly me.
Andrew | Dec 29, 2011 | Reply
Make that people of course.
Andrew | Dec 29, 2011 | Reply
Soylent Green is people!!
Big Phatt Woman | Dec 29, 2011 | Reply
So why don’t we go back to every man for himself and whom has the biggest army wins!!!!
Joshmo | Dec 29, 2011 | Reply
Or who has the fastest draw, wins the gun fight!!!
Joshmo | Dec 29, 2011 | Reply
Frédéric Bastiat: “Socialism confuses the distinction between government and society. Every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.”
Socialists also confuse the role of government. Whenever government provides a service, Socialists proclaim that only government can provide that service, and we owe our souls to the government because it is kind enough to provide that service rather than let us die.
– –
Bob: You put out the fire. I can’t thank you enough.
Official: Hand over the keys. We own that house now. It would have burned to the ground without us.
Bob: But, I already paid taxes for your help.
Official: I apologize. You have a point. Instead, pay us in tax half of what you produce. That is for our effort in providing all of our vital services.
– –
Even if someone protects you, you don’t owe them everything. You can usually arrange a better deal than that.
One human doesn’t own another one because he supplies an essential service. We aren’t each other’s slaves. Our obligations of mutual cooperation are satisfied when the transaction is complete. One or the other can’t come around the next day saying he wants more. You might as well base society on the gun; give me more or I will shoot you. And, that is a good deal, better than being dead.
Government usually has a formal monopoly on force. That doesn’t confer the right to make the population into slaves. From time to time, governments have asserted this right, and it always ends badly.
Your Dog Owns Your House
– –
The claim of Progressive government:
• We tax you to provide police protection.
• You are alive because of us.
• So give us whatever we ask for. You are lucky to be able to contribute.
Do they own you because they help you? No, because you have the natural right to make a better deal than that, and not submit to force, if possible.
One human doesn’t own another one because he supplies an essential service. We aren’t each other’s slaves. Our obligations are satisfied when the transaction is complete. One or the other can’t come around the next day saying he wants more. You might as well base society on the gun; give me more or I will shoot you. And, that is a good deal, better than being dead.
Your Dog Owns Your House
Andrew_M_Garland | Dec 29, 2011 | Reply
Not only your earnings, but your body, your mind, your children and your life. Government officials think that EVERYTHING of ours belongs to them.
shemsky | Dec 30, 2011 | Reply
It was the entrepreneur that moved to the wilderness ahead of civilization and put up trading posts that society coalesced and built around – in other words Ms Warren – business came first and paved the way for government to come later.
Funny | Dec 31, 2011 | Reply
Joshmo, You are describing exactly what Big Government electoral politics is all about and why the natural-law principles that all individuals have inalienable rights to life, liberty an property should be protected under a uniform rule of law. The solution is hence to radically reduce the power and spending of government. Here is Dr. Higgs book in that regard:
Against Leviathan: Government Power and a Free Society, by Robert Higgs
David Theroux | Dec 31, 2011 | Reply
When government tells you you have no other choice but to follow their rules, you fall under their boot of oppression....i.e., Hitlers Germany, USSR, China, North Korea, Cambodia, Vietnam, most African nations. See what had and is happening to them today. Do we want to be next?
spokanetomcat | Jan 1, 2012 | Reply
I think many commentators missed the point that Ms. Warren was delivering – that in a civilized society we all contribute to the maintenance, betterment and rewards that a civilized society offers. A civilized, and theoretially compassionate, society requires rules and regulations to function, and, for the most part, we all benefit from them, including those that “built the factory.” It’s when there’s abuse, greed, corruption and criminal behavior, that the fabric of civilization begin to unravel.
Tim Hankins | Jan 8, 2012 | Reply
The following ‘history’ by Harvard Law School professor Elizabeth Warren of American entrepeneurship is completely false: “There is nobody in this country who got rich on his own. Nobody. You built a factory out there—good for you! But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.”
This is not the way that Texas, America, or especially the American West was settled, and no doubt Professor Warren knows better. I don’t know why she stooped to court room theatrics in her attempt to impose a history upon America that never was, but the campaign trail invites many such misdeeds.
How does someone, whose undergraduate study was completed in Texas, not know that in the early days of the “Lone Star Republic”, as in the rest of America, government was NOT the first on the scene but the last? Too many a town in the American West began when someone bought some land or homesteaded it. In some cases, the property owner came to know there was coal or other valuable ore underground, whereby he hired workers to begin digging. Those workers soon built houses so that their wives and children could join them. Next came a church and a schoolhouse. Shops sprang up. Even a bank. Government was lastly created.
Consider the case of the African-American town in Oklahoma where ‘Pretty Boy’ Floyd’s gang met its demise. No sheriff and a bank that caught the gang’s attention. Floyd said ‘no’ and didn’t go, but his gang went without him. When they robbed the bank, every shopkeeper in town stepped out with his rifle and the gang was no more.
That’s how most of America was settled – by people, not government. Government came last.
Bob Williams | Feb 12, 2012 | Reply