Rand was right. Where is our John Galt?

Where is our John Galt who will say to parliament that the dire straits we are in are not a result of the sins of selfishness but of the supposed virtue of self-sacrifice?

Where is our John Galt?
Guy Bentley
On 19 November 2012 17:10

Last week we were treated to the spectacle of executives from three successful companies called to answer for their failure to pay what was deemed to be their 'fair' share of tax.

The head of Google in the UK and executives from Starbucks and Amazon appeared before the public accounts committee to receive the righteous grilling that these apparently ‘anti-social villains of the corporate world’ so richly deserved.

These companies, it appears, had been using European and other tax jurisdictions to pay lower rates of tax than if their affairs had been handled in the UK. The methods used were legal and consistent with current tax laws.

The purpose of their appearance before the public accounts committee was to explain why and how they were paying so little tax to the UK government. However, this event had a wider significance than exploring the obscurities of tax law.

The intent of the committee became apparent in that this was not supposed to be a constructive discussion but rather one of public shaming. These companies were there to explain why they had failed in their moral obligation to pay what was deemed by the MPs sitting on the committee to be a fair amount of tax.

These men, representing their companies, were there to be humiliated. They had been summoned by legislators to answer not for crimes committed against the law but for supposed crimes against a moral code.

Margaret Hodge MP, the chair of the public accounts committee, admitted so much in her statement: “we're not accusing you of being illegal we are accusing you of being immoral”. Meanwhile campaigner for higher taxes Richard Murphy wrote that “these companies have lost any moral high ground”.

The issue of tax has moved in the public discourse from being primarily an economic issue to a moral issue. The government is deeply in debt and is desperately seeking ways in which it can extract more tax from the citizenry while only making the most modest of efforts to downsize its own activity.

The attitude on display from MPs was that the government had been cheated out of what was rightfully its own by companies using shady methods to avoid tax and make as much money for themselves and their shareholder as possible.

But here is where morality truly comes into play. If these companies were indeed avoiding tax as much as they possibly could in order to make more money for themselves and their shareholders, then these companies were acting not immorally but the complete opposite. These companies are creating wealth and value, translating their visions for products into practical reality, and being rewarded or not in the market place by their customers.

Michael Meacher MP branded Starbucks incompetent; Margaret Hodge, when she had not received the answers she was looking for from the director of public policy for Amazon across Europe, said, “we will order someone to appear before us” to answer their questions – this spoken in a regal tone with all the arrogance of power that legislators believe is rightfully theirs.

But this invocation – that tax is a moral obligation – is an idea thoroughly incompatible with a free and moral society. Taxation is the extraction of wealth by force and then this is transferred to others whom the coercers deem worthy to receive it.

Those who support taxation usually justify its coercive nature on the grounds that it will lead to some greater social utility. This is a typical ends justify means argument with no regard for individual rights. The act of taxation is not a moral one, just as a mugger who steals your money and gives it to Oxfam is not engaged in a moral action. Neither does it matter who authorises taxation, in terms of its morality.

Tax is theft whether levied by a king, church or democratic state. In the words of the novelist and philosopher Ayn Rand:

''An attempt to achieve the good by force is like an attempt to provide a man with a picture gallery at the price of cutting out his eyes''.

Force is the enemy of reason. The public accounts committee in its drive to squeeze more money out of corporations is not helping society; it is contributing to its downfall. Tax, unlike trade, is not a win-win relationship; it is a zero sum game.

The moral climate since 2008 has become one increasingly dominated by a persecution of the rich. Some of the targets of this anger are justified such as those who are in receipt of bailouts and corporate welfare.

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