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Posts Tagged ‘Taxes’

An Origami Heart folded from a US one dollar bill

An Origami Heart folded from a US one dollar bill

I find it very bizarre that during a time of economic upheaval the Globe and Mail is running a series on “Giving.” Is Charity the answer to our economic woes? Some seem to suggest that it might be. For example, Ed Clark, CEO of TD bank (whose salary rose by 9% last year, while inflation is at 3% according to the consumer price index) said:

“We live in a market economy,” which means that paying executives less than the market rate will make it hard to attract the cream of the crop, he [Clark] said.

“Personally what I’ve always said is… what you do with your pay matters. You can solve this problem on how you behave personally in terms of charitable donations and things like that, and try to reconcile that dilemma.” (Source).

Clark believes the problem of CEO pay would be difficult to address directly (by lowering or limiting it), or we would not be able to attract “the cream.”[1] So the solution is for CEOs to act charitably.[2] Again, a similar refrain to the Globe section, I linked to above.

This suggestion seems problematic to me. There is a moral difference between equality achieved through rights (as a matter of what we are owed as persons) and equality achieved through charity (as a matter of the beneficence of others). Immanuel Kant discusses the danger that charity poses to the self-respect and dignity of the recipient in The Metaphysics of Morals.  Although I have some quibbles with Kant’s discussion in these sections, I think it is right in the broad outlines.

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Yesterday in the USA, Federal Judge Roger Vinson ruled that the individual mandate was unconstitutional (the whole opinion is here), and so ruled the entire health care law is void:

Because the individual mandate is unconstitutional and not severable, the entire Act must be declared void. This has been a difficult decision to reach, and I am aware that it will have indeterminable implications. At a time when there is virtually unanimous agreement that health care reform is needed in this country, it is hard to invalidate and strike down a statute titled “The Patient Protection and Affordable Care Act.” (pg. 76)

One thing raised in the ruling is whether the individual mandate is unprecedented:

Congressional Budget Office Memorandum, The Budgetary Treatment of an Individual Mandate to Buy Health Insurance, August 1994 (“A mandate requiring all individuals to purchase health insurance would be an unprecedented form of federal action.”) (“CBO Analysis”). Never before has Congress required that everyone buy a product from a private company (essentially for life) just for being alive and residing in the United States. (pg. 38)

Judge Roger Vinson rightly notes that the mere fact that a law is unprecedented does not necessarily mean that it is unconstitutional, but, he writes,  a lack of previous similar legislation might nevertheless count against the presumption that a law is constitutional:

As I explained in my earlier order, the fact that legislation is unprecedented does not by itself render it unconstitutional. To the contrary, all federal legislation carries with it a “presumption of constitutionality.” Morrison, supra, 529 U.S. at607. However, the presumption is arguably weakened, and an “absence of power” might reasonably be inferred where — as here — “earlier Congresses avoided use of this highly attractive power.” Printz v. United States, 521 U.S. 898, 905, 908,117 S. Ct. 2365, 138 L. Ed. 2d 914 (1997); id. at 907-08 (“the utter lack of statutes imposing obligations [like the one at issue in that case] (notwithstanding the attractiveness of that course to Congress), suggests an assumed absence of such power”) (emphasis in original); id. at 918 (“almost two centuries of apparent congressional avoidance of the practice [at issue] tends to negate the existence of the congressional power asserted here”).

The mere fact that the defendants have tried to analogize the individual mandate to things like jury service, participation in the census, eminent domain proceedings, forced exchange of gold bullion for paper currency under the Gold Clause Cases, and required service in a “posse” under the Judiciary Act of 1789 (all of which are obviously distinguishable) only underscores and highlights its unprecedented nature.  (pg. 39)

Does that mean that if there were a previous law that imposed similar obligations, then the presumption that the law is constitutional would be strengthened?

Because Rick Ungar uncovered a precedent from 1798 “An Act for the Relief of Sick and Disabled Seamen.” Ungar writes:

In July of 1798, Congress passed – and President John Adams signed – “An Act for the Relief of Sick and Disabled Seamen.” The law authorized the creation of a government operated marine hospital service and mandated that privately employed sailors be required to purchase health care insurance.

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Two women are married as the snow flies around them.

Last night I watched the documentary, Escape to Canada, about “2003 when by apparent coincidence, gay marriage is legalized and the prohibition of marijuana is removed on the same day.” While watching this film, I noticed several instances of the argument that is the title of this post. Canadians interviewed for the film argued that they wanted to be free and part of what freedom meant to them was the ability to pay their taxes (examples below the fold).

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