Does Stephen Harper Have Lunatic Ideas About Taxation?

14 07 2009

Today’s Globe and Mail has a piece by Jeffrey Simpson analyzing some particularly idiotic comments uttered by Stephen Harper during a recent interview with the paper’s editorial board.

Mr Harper said: “You know, there’s two schools in economics on this. One is that there are some good taxes and the other is that no taxes are good taxes. I’m in the latter category. I don’t believe that any taxes are good taxes.”

Simpson correctly points out just how ludicrous this statement is. Mr Harper appears to be arguing against taxation, a position that leads one to believe that he is in favour of the effective abolition of the state. It is one thing to say “Canada’s current rate of taxation is higher than would be optimal” or “we should change the relative mix of taxes” or “this particular tax is the least bad tax” . It is quite another to come out against taxation, especially when one is the leader of a government that has, to date, engaged in only minor tinkering with the tax system, not to mention far more spending that the predecessor Liberal government.

Harper’s comment suggests that he secretly shares the beliefs of anarcho-capitalists and the other extreme libertarians who envision a society without any taxation. (As a very young man, I briefly flirted with such ideas, only to realize that they were wildly impractical). I wonder how Mr Harper would reconcile the position quoted above with, say, his frequently reiterated support for socialized medicine, an institution most Canadians regard as a defining national institution. A few other thoughts.

1) There is a problem with beginning sentences with “you know”. It is poor English. If the listener already knows a fact, why restate it?

2) Mr Harper prefaced his next comments with the words “there’s two schools in economics on this”. (I presume he meant “there are”). I’m struck that Harper adopted the pose of a teacher, explaining economics to the Globe and Mail’s editorial board. Mr Harper is not an economist. He took an undergraduate degree in economics and then wrote an MA thesis in political economy. He does not have a PhD and has never worked as an economist. In fact, I suspect that some members of the Globe’s editorial board have at least as much formal training in economics as Mr Harper. Some may even have actual graduate degrees in the discipline. The quasi-professorial presumption revealed by Mr Harper in this statement is amusing. Mr Harper’s comments suggest that a little bit of knowledge is a dangerous thing. I am not an economist, but I am an economic historian who reads journals in which economists publish and who thus is tolerably familiar with the discipline of economics. I therefore feel somewhat qualified to report that there are many schools of thought in the economics profession about the best way of raising public revenue, not just two. Moreover, Harper’s apparent view, that all taxes are bad (and therefore should be abolished) is a position shared by few, if any, economists, certainly not by tenured economists at mainstream institutions. One possible exception to this statement is Murray Rothbard, an economist who adopted the extreme liberation view that all taxes were bad. Rothbard, however, was a marginal figure in academe and new held a tenure track position. Moreover, most economists disagree with the taxation policies of the Harper government, especially its decision to prioritize cuts to the GST, a consumption tax.

3) If they truly represent Mr Harper’s views, the man is well outside the mainstream of Canadian, or indeed, Western politics. Indeed, they are with few precedents in twentieth century Canadian politics. In the 1860s, a few of the more extreme Anti-Confederates adopted the position that “all taxes were bad” (see my article on the subject in the Canadian Historical Review), but one would hope that a serving Canadian Prime Minister would not want to identify themselves with the people who opposed Canada’s creation.

It may be that Mr Harper was misquoted. As someone who voted Conservative in 2006, I sincerely hope that this is the case. Mr Harper normally adopts a tone of moderation and reasonableness. In an attempt to win over centre-right Liberal voters, Harper has tried to associate his policies with the fiscal tradition of Paul Martin. But the statements reported in today’s blog post identify Mr Harper more with the lunatic fringe of right wing politics in the United States than with any identifiable Canadian political tradition.

If the quote is accurate, the best that could be said about Harper is that he was inarticulate, not an extremist.  We need to ask, however, whether we want an inarticulate person in charge of the nation’s finances?