How Have My Political Views Changed Over Time?

I sometimes wonder if I'm too locked into my political ideology. I have been a libertarian of some sort basically as long as I've known what the word means, i.e. about seven years. However, in that time my views on various individual issues have changed; hopefully this means that the fear in my first sentence is not too accurate?

In any case, here is a set of notes I came up with when trying to work out how my views have changed. The four big driving forces between the changes have been:

-I became much less confident in the possibility of "moral truth", which (a) reduced my commitment to making everything fully consistent and (b) made me more sanguine about advancing political positions on aesthetic grounds. (This is quite possibly a negative development; that said, it made it easier to be honest about my real motivations for some policies, e.g. monarchism).

-aged 18, I was a committed Christian and so if I were to hold a belief about politics, either it had to be consistent with Biblical teachings or I had to twist my understanding of the Bible to fit my political leanings. (I remember being very upset when I read Exodus 3:22, which seemed like a blatant endorsement of theft). Between October 2013 and April 2014, I became convinced that Christianity is false.

-in Sixth Form and the first year of undergrad, I knew no other libertarians and the closest I could find to people who agreed with me were a couple of socially-liberal Tories; during the second-year of undergrad I got to know Sam Dumitriu, who eventually got me to start using Twitter, with the result that I quickly fell in with the #MCx crowd. We are all influenced by the people we talk to, partly because of honest intellectual influence but mostly because of a desire to fit in and look cool; hence my move to "neoliberalism" over "libertarianism".

-partly due to my loss of faith in deontological libertarian moral realism and partly due to people on Twitter - most obviously Sam Bowman and Ben Southwood - I became much more utilitarian. It's hard to date this exactly, but I particularly remember one afternoon of summer 2016 spent walking in County Kerry with my dad, when I concluded that either one took the Enlightenment seriously or one didn't' If one didn't, then what resulted was a tribalist, emotivist politics that was honest, if barbaric. If one took the Enlightenment seriously, then either one concluded that other people matter - in which case, why not go all the way to utilitarianism? - or only oneself matters, in which case ethical egoism results. Concepts like citizenship are attempts to maintain the visceral emotional appeal of pre-enlightenment politics in a post-Enlightenment context, but I think this attempt is ultimately dishonest. Emotional appeal ought to be abstracted as far as possible (which is not the same as removed!) from a political system based on reason. I've moved away from this somewhat since, but remain basically utilitarian.

With that overly long explanation out of the way, a list of fifteen ways in which my views have changed (still in note format but with some explanatory links added, I'm not going to tidy this up):

-used to consider anarchism to be the moral ideal towards which we should aim. Circa 2014 concluded that it was probably both viable and better than status quo, but minarchism to be preferred as a way of controlling negative externalities. Nowadays (since early 2017) suspect it may be unstable due to people's tribal instincts - though still would like to see it tried!

Given the supposition of a government:

1-used to advocate "liquid democracy". Now heavily opposed to anything approaching direct democracy, and would advocate for UK and other major liberal powers to be less democratic on the margin. Had a period of extreme scepticism of democracy due to Jason Brennan (circa early 2013-late 2016 or early 2017); now think it has important instrumental-expressive purposes in maintaining public order.

2-used to be uneasy about redistribution in principle, but would tolerate sufficientarianism. Now at peace with the principle of redistribution, though heavily concerned about *how* it is implemented. Partly due to Joseph Heath (ctrl-f "risk-pooling"), partly due to becoming more neoliberal/utilitarian, which is probably more due to the people I talk with than due to any particular argument. (Took a long time, but roughly late 2013-mid 2016)

3-used to be heavily opposed to military interventions. Now cautiously in favour, largely due to the influence of Mugwump. (still in flux)

4-used to be heavily concerned about tax rates. Still think they matter, but no longer consider them the highest priority. Always thought *how* we taxed matters, though have a more sophisticated understanding of taxation theory than I did back then. Used to advocate negative income tax; now prefer progressive consumption tax.

5-realised free trade is about much more than tariffs and quotas - free trade agreements serve a genuinely valuable purpose. Relatedly, was eurosceptic; switched to being pro-EU around late 2014, as a result of debate preceding the referendum became vastly more pro-EU. (Possibly also related to change in self-image due to living in Hungary for two years).

6-was unconcerned about fertility. Now consider it a top priority, mostly due to Nancy Folbre though partly due to combination of Parfit/Cowen on discounting the future with my own work opposing antinatalism. (early 2015-present)

7-used to assume that Austrian goldbuggery was sensible. (How embarrassing!) Have given up having strongly held views on monetary policy, though Scott Sumner is fairly persuasive. (change around early 2013 - mid 2015?)

8-as natural-rights libertarian, assumed there was a definite answer to whether or not intellectual property was valid, leaned towards not. Nowadays take a much more utilitarian view, thinking that in purely instrumental terms there should probably be some but less than we currently have.

9-was pro-open-borders. Now merely think we should have open borders for citizens of other liberal democracies, and higher but not unlimited immigration from less liberal countries. Didn't care about integration, seeing it as a service provided by host country to people who should be quite happy to reap the benefits of moving to a richer country; now see integration as an act of self-defence. (2016?)

10-thought we should tolerate more terrorism. Still think it's greatly overrated as a threat, but think that (a) preventing people from overreacting is intractable, and (b) costs of anti-terrorism much smaller than I thought back then.

11-struggled to find a reason to be monarchist while still being anarchist. Now I'm (a) less of a moral realist so happier to advocate political institutions on aesthetic grounds, (b) equipped with evidence that Habsburgs were good for Mitteleuropa.

12-was heavily opposed to existence of national debt. Now think morality of national debt dependent upon other institutions, in particular with how much we do to encourage fertility. (2015-early 2017, especially more recently with my work opposing anti-natalism: I came to think that we ought to subsidise procreation, but it seemed fair that the people benefitting by being born ought to bear the cost of subsidies)

13-felt reasonably comfortable with Conservative Party. Also thought UKIP were alright. Think Tories and Labour worse than they were back then, probably happier with Lib Dems than I was. (this probably more due to changes in the parties than changes in my own views, however)

14-thought strong governments (and consequently FPTP) were hugely important. Don't think I had any good reason for this belief. Now hold no strong opinions on this beyond "it depends". (Don't know when this changed, but probably not before 2011 AV+ referendum)

15-now advocate returning the Elgin Marbles. Felt awkward about this in much the same way as the monarchy insofar as I thought about it at all; this Ed West tweet convinced me that they ought, so long as Greece can look after them (which it admittedly might not be able to given the current economic situation), that they ought to be returned ASAP. (This is perhaps the only change in my views which happened in a single moment rather than over time).

Tax Avoidance: Government Policy in Action

Since tax avoidance is currently in the news, I'm linking to a couple of interesting articles that I have recently read on this topic. First, Gaps and holes: How the Swiss cheese was made is an account of how the modern system of tax havens developed. The story is basically that during decolonisation, former colonial powers - and especially the UK - were happy to let their former colonies become tax havens because the colonies commonly had no major industries. This didn't impact too much during the formation of welfare states because globalisation hadn't gone all that far, which meant that it was difficult to protect your wealth all that much. As the world shrunk, though, it became vastly easier to earn money in one country but register it elsewhere. Tax avoidance existed prior to globalisation, and was a major source of income for tax havens before globalisation, but it was globalisation which made it the major political issue that it now is.

Second, India's Curry Tax Exclusion Goes Awry is the story of a very fun avoidance scheme in India. The government declared that, in an attempt to lure international food companies to India, all businesses producing curry would face a specially lowered tax rate. Unfortunately, it defined curry not by its function but by its content - with the result that all sorts of companies have been able to access this reduced rate. The extreme end of this is that steel producers have been mixing in peppercorns and declaring the resulting steel to be curry. In a victory for enforcing the law as it is actually written, the courts have upheld this.

The point common to both of these - tax avoidance is not simply something that greedy rich people and corporations do. It is a result, intended or otherwise, of government policy. The fact of tax avoidance is yet another reason why taxes should, above almost all else, be simple.

PS. To be clear, in this piece I am talking entirely about tax avoidance (which is legal) and not about tax evasion (which is illegal). These are related but separate issues and require separate treatment.

The Liberal-Egalitarian Case Against Income Tax, Inheritance Tax, and VAT Exemptions

Liberal Neutrality is the belief that the state ought not, so far as is possible, to promote one conception of the good over another. In layman's terms, that means that people should be allowed to choose how they live their lives without being punished, rewarded or fined for it. (Obviously this excludes things where they harm other people. Then you have to work out what counts as a morally relevant form of harm, and it all becomes very complicated.) It is a view that, broadly speaking, I agree with.

In economics, there is a concept of "tax distortion". If you tax apples, then people change their behaviour: apples are essentially more expensive, so people eat fewer apples and eat more pears instead, and people have less money due to paying the extra tax, so they reduce their consumption of everything. A non-distortionary tax is one which has an income effect (that is, people becoming poorer and so reducing consumption) but no substitution effect (so there is no change in the relative prices of any goods).

There are three types of non-distortionary taxes. The first is the taxation of goods with an absolutely fixed supply, such as land. The tax does not affect demand, and cannot affect supply, so the price has to stay the same. A second non-distortionary tax is the poll tax, the tax on being alive. Finally, a consumption tax can raise the price of all goods equally, so that there is no change in the relative prices of goods.

I'm not aware of anyone previously having connected up these notions. It's worth noting that they are not the same: in my view liberal neutralism is also consistent with Pigovian taxes - that is, taxes on what economists call "negative externalities" - things like pollution, where one person unintentionally harms another in a way that is hard to enforce a legal right against.

For a state to fulfil liberal neutralism, then, requires it to abolish income taxation, inheritance taxation, sin taxes on sugar and alcohol, and move towards a consumption-tax system. This would of course be controversial, but I maintain that all objections which do not end up rejecting liberal neutralism are ultimately based upon misunderstandings.

Objection One: Consumption taxes are regressive

That depends upon what kind of equality you care about. It's true that philosophers tend to talk about wealth and income, but that's because they haven't really thought about what it means to have money which you don't spend.

Moreover, surely it's not important that the tax system be progressive so much as that the social system as a whole be progressive? If someone proposed a law to make "Jerusalem" the national anthem, you wouldn't object that the law failed to promote equality. Similarly, it's fine to have a possibly-regressive tax system if you combine it with a basic income; the combined effect will be similar to a negative income tax, and so will overall be progressive.

Objection Two: Okay, but there should at least be exemptions for staple foods and other essentials

Think about it this way: if everyone had plenty to live on, and there was no poverty, would it be a problem that tax was charge on these essentials? Surely it would no more of a problem than taxation of any other goods. This points us to the real problem here: that some people are in poverty and don't have enough to live on. But we can solve that problem by giving them money, such as through the basic income I suggested above. Compared to uniform taxation and giving poor people money, the effect of removing consumption taxes is to give a tax break to the well-off. If you're not convinced, read Joseph Heath (or listen to his interview on Rationally Speaking, which covers this ground).

Objection Three: This removes democratic choice

This is partly a question of how valuable you take democracy to be as an end in itself. If you believe that immoral things can be made moral by a democratic vote, then sure. Communities can have the right to levy whatever destructive and illiberal taxes they like. But if you think that democratic choice is constrained by justice, then liberal neutrality does indeed restrict the right of polities to tax in whatever way they choose.

Note, however, that we're still leaving room for a fair amount of democratic choice. Countries can still choose to nationalise industries. If you believe that state provision of education and healthcare free at the point of usage is consistent with liberal neutralism, which I think is highly plausible, then you can have that. And once you've decided exactly what services and benefits you want the state to provide, what exactly is left to decide? The actual rate of tax is just the government's budget divided by the total GDP, so it's not like there's a great deal of choice going on under any system (unless that choice is "let's have lets of spending now, put it onto the national debt, and our grandchildren can pay for it.")

Tax Incidence

I've been enthusiastically linking to Vox since it started up, it's time for some criticism. Specifically, of this tweet:

Corporations used to pay almost one-third of federal taxes. Now it's one-tenth. http://t.co/dw4tmalT98 pic.twitter.com/QFDZLF4cVi
— Vox (@voxdotcom) July 27, 2014

As anyone with a basic understanding of economics could tell you, it's not about who has to pay the tax, it's about who bears the burden of the tax incidence. For example, if you require employers to pay a tax on all wages paid to employees, they will be less willing to employ people and so employees will be be forced to suffer lower wages. Similarly, if you require employees to pay a tax on their incomes then they will demand higher wages to compensate and so some of the burden will be borne by employers.

The point of this, then, is that measuring who pays taxes is pretty useless as a measure of who is actually being taxed. You can work out who actually bears the burden by measuring elasticities of the supply and demand for labour, but I've spent most of today drinking networking and hence am in no fit state to explain how this is done to the layman. In any case, this is hardly necessary, what I wish to say is that Vox is attempting to make a political point with figures which don't really show anything at all. (As it happens, somewhere in the region of 40-60% of the burden falls on workers in the form of higher wages and the rest falls on capital owners; neither of these is a desirable outcome, and taxes on capital are considerably worse than they sound).


There is another thing I wish to say about this. About a year back, there were adverts on the sides of buses in the UK - or at least, in Birmingham, I don't know about there rest of the country - put there by Her Majesty's Revenue and Customs, advocating National Insurance a workplace pensions scheme (thanks to Sam for correcting me) at least partially on the grounds that "you pay in, your boss pays in" and accompanied by the face of Theo Paphitus of Dragons' Den fame. While there may well have been solid grounds for supporting the scheme, this hardly seems like one of them. The incidence of the pension contribution will not change, any more than if employers were required to buy employees' groceries.

The move towards the scheme being opt-in makes some sense, as does the tax relief. However, requiring both the employer and the employee to contribute achieves... what, precisely? Increased paperwork? The most charitable explanation I can think of is that this kind of "everyone contributes" is modelled on National Insurance, which was designed in a time before politicians were likely to be criticised for poor economics. (This was a time when free trade, despite having being considered a no-brainer by actual economists for more than seventy years, was still a controversial issue, so it is harder to blame David Lloyd George for the poor design of National Insurance.)

A taxation policy proposal

The higher your income, the more the state taxes - not just in absolute terms, but as a proportion of your income. This is generally agreed to be because richer people have a lower marginal utility of wealth: an extra £1000 a year is worth less to you if you're already earning £50,000 per annum than an extra £100 a year if you're earning £5,000 per annum.

But income isn't the only thing which affects the utility you gain or lose from changes in your income. For example, if you are on the political left then you are likely to view your tax payments as an excellent chance to help those worse off than yourself; if you are a libertarian, you are more likely to regard them as tantamount to theft. All else being equal, a libertarian will lose more utility from being taxed than a leftie taxed the same amount. It follows that libertarians (and perhaps to a lesser extent right-wingers) ought to receive tax breaks.

The Endowment Effect, PAYE and Indirect Taxation

A brief introduction to the UK tax system for foreign readers: income tax is paid upon all income above £9500 per annum, at a rate between 20% and 45%; National Insurance is essentially another income tax, levied at a rate of 2% on the employee and up to (IIRC) 12.8% on the employer, and if you're paying it at that rate then there's no NI-free allowance; Corporation tax is 22% for small companies and 28% for large ones; VAT is essentially a sales tax of 20%, though with exemptions for certain basic goods. There are heavy duties on fuel, alcohol, cigarettes etc. Inheritance tax is 40% beyond a certain threshold. Council Tax is charged upon an outdated estimate of the value of your house. Businesses have to pay Rates based upon the value of the land they occupy.

Reading a post by Bryan Caplan and watching a lecture by David Friedman, I started thinking about the endowment effect and loss aversion in relation to the State. The remarkable thing about modern tax collection is how little of it is collected directly from the taxpayer: income tax is paid automatically when he receives his wage; National Insurance and Corporation Tax are both supposedly paid by the employer, even though it is well established that the burden falls upon the worker; VAT is paid by the seller, although everyone knows that the burden falls upon the buyer; indeed, a key driver of inflation a year or two back was a rise in VAT from 17.5% to 20%. This goes for the various taxes on individual goods - alcohol, cigarettes, petrol etc. As such, the public faces higher prices but does not think of it as taxes.

If tax is inevitably going to be paid, then perhaps these are not bad things. It's certainly more efficient for a boss to send one cheque for all his employee's taxes than for them each do so individually. (It also reduces the ability of individuals to evade taxation, though I'm not exactly thrilled by that). But this is going to have a sizable effect upon public perception of taxation. Imagine that instead of receiving pay of £22,000 a year and paying current prices, you received £30,000 a year, prices were about 17% cheaper, and every year you had to send the government a cheque for £15,000. I can't help but think you'd be considerably more reluctant to do so.

To what extent might this be a factor leading to larger government? Well, not necessarily much of one. My understanding of the evidence is that reducing taxation does not cause governments to cut spending by much, if at all. But it almost certainly has some effect, and it can serve an example of how subtle the State's influence can feel.

For a view of this issue from a different perspective, see http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2013/05/taxes-norms-belief-equilibria.html