The Taxman Cometh

Saturday 26 May 2012 5:05PM

Carbon Tax, Mining Tax, or simply struggling with your annual return, one thing is clear – Australians don’t like paying taxes. While most of us understand our moral and ethical responsibilities towards creating a just and equitable society, we disagree profoundly on how best to do it. But is our social democratic model of tax and welfare working as well as it should, and if not, can philosophy and theology offer an alternative vision of a virtuous economy?

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(Sound from anti-tax rally)

Tim Andrews: We don’t like paying taxes because we work hard to make money and the government takes it away from us and redistributes it.

John Milbank: Tax is never going to be popular and yet sort of reluctantly we know that it’s necessary.

Paula Clifford: We tend to see it in terms of the state taking money off me for whatever purpose, whereas in reality if I fail to pay the tax that I owe to the state, poor people will suffer.

Tim Andrews: Tax is theft. Some of it may be justifiable theft, but we should be starting from a principle that it’s a necessary evil and not a great good.

Man (from advertisement): It’s tough times! The price of maintaining a fleet of yachts is at record highs. Not to mention the soaring cost of caviar.

Gary Bryson: Tax: some of us hate it, most of us understand its importance in a modern society.

Man (from advertisement): That’s money that’d be frittered away on hospitals, schools and roads…

Gary Bryson: We might not like paying tax, but in a country as rich as ours, what are our ethical and moral responsibilities towards creating a society that’s just and equitable? Here’s Stan van Hooft, an ethicist and professor of philosophy at Deakin University in Melbourne.

Stan van Hooft: When you object to contributing according to your capacity, it’s very often motivated by the thought that ‘I’ve worked very hard, I’ve earned a lot of money, I’ve taken risks, I’ve taken opportunities. I deserve the money that I have earned and therefore I’m entitled to keep it or to dispose of it as I see fit rather than as the government sees fit.’

Gary Bryson: Do we have a responsibility in a modern society—an ethical responsibility—to pay taxes and to redistribute wealth for the greater good? And how would you argue that ethically?

Stan van Hooft: I think you would allude to the classical concept of the social contract. What the social contract means is that we live together as citizens of a state or as members of a society—those two concepts are slightly different, morally speaking, but still—we live together in a system of cooperation. What that means is that we help one another achieve our life’s goals. And we largely do that through the agencies of the state. And that being the case, we’re obliged to contribute to the exercise of those functions and to allow the state to do those things.

And we’re obliged to contribute on the basis of our capacity to do so. That’s perhaps where the matter becomes a bit more contentious. It might be argued that everyone has an equal obligation to contribute, but the fact is not everyone has the equal capacity to do so and so we have a taxation system which allows the rich to contribute more.

Gary Bryson: While hard work and being smarter than the average can make you rich, Stan van Hooft argues that the society you live in has a crucial part to play in your success.

Stan van Hooft: Your capacity to earn that money has been due not only to a degree of luck, more often than not, but also due to the infrastructure that the government has provided to you. You cannot make money in a modern society unless you make use of government-funded resources: the legal system, the commercial system, the infrastructure that I mentioned earlier, and so on. So you can’t say—or at least you shouldn’t say—’Look, it’s all mine.’ The fact is you’ve earned this money as part of the social contract and you have benefitted from the social contract, you’ve benefitted from the facilities and the opportunities which the society’s given you; therefore, you owe the society a contribution.

Gary Bryson: How do you respond to the idea that all tax is theft?

Stan van Hooft: I’m actually struck by how often that’s said, you know, it’s somehow a threat to our property rights that we should pay taxes. And the grounds for that would tend to be that we’ve earned the money. It seems to me we should think of taxation as a part of a contract. In a very general sense, we’re buying a set of services from the government and insofar as we take advantage of those services we need to pay for them.

After all, there are some basic things that taxes pay for that no government can fail to deliver, most obviously national defence, then there’s policing and maintenance of the rule of law. These are not things that we can choose to pay for or not pay for and they’re not things that government can choose to put into effect or not.

John Milbank: Morality is continuous. We’re discerning all the time. And what we really need to do is in a profound sense we need to re-ethicise our social and economic life.

Gary Bryson: This is John Milbank, professor of religion, politics and ethics at the University of Nottingham and director of the Centre of Theology and Philosophy.

John Milbank: The traditional, the classical, the medieval, the Christian outlook is that justice is about fair distribution according to people’s needs, people’s flourishing, and so on. The modern assumption is that we’re all isolated, private individuals making contracts with each other, and that justice is merely about preserving individual rights and supporting contracts.

So this means that we assume a kind of war, as social war, a kind of social barbarism. And then we have the idea that the state can somehow make a minor adjustment to that, you know; this is roughly the social democratic model. And I would want to support—and I believe this is the Christian, the Catholic way of looking at things—the much more radical idea that we need fair distribution in the first place.

Gary Bryson: John Milbank. We’ll come back to him and to ideas about justice and fair distribution, but first let’s join a gathering of well-dressed people who think that any distribution of resources through taxation is deeply unfair.

We’re in the Stranger’s Dining Room at NSW Parliament House in Sydney, at the launch of a new advocacy group.

Tim Andrews: (Addressing the group) And thank you everybody for coming here and joining us tonight for the launch of the Australian Taxpayers’ Alliance, a true grassroots activist organisation, standing up for the rights of all of us as Australians, all of us as taxpayers, and actually going to provide a voice against all the special interest groups that dominate the media at the moment.


Gary Bryson: Tim Andrews is the man behind the Australian Tax Alliance. He’s also managing editor of Menzies House, an online community for conservative, centre-right and libertarian thinkers, and a committee member of the Australian Libertarian society.

Tim Andrews: We see so often in the media, in public debate, there are all these special interest groups saying, ‘We want more taxpayer money, we want more taxpayer money. Gimme, gimme, gimme.’ And there really isn’t a voice out there for all the hardworking Australians who pay the taxes. So we’ve launched to represent Australian taxpayers—whether they be working Australians, whether they may be retired but still pay taxes—and to fight big government, oppose burdensome regulations and try and expose government waste and have a better tax-sensitive government system.

Gary Bryson: Why is it, do you think, that paying taxes is such an unpopular thing amongst people of all tax brackets, really? We don’t like paying taxes, do we?

Tim Andrews: Well, we don’t like paying taxes because we work hard to make money and the government takes it away from us through its coercive powers and redistributes it. And I think that people generally don’t like being forced to do something against their will, which is what taxes are. And you can argue that they’re necessary, but the high level that we have in Australia I think makes it even more unpopular and I think for very good reason.

Gary Bryson: Would you describe yourself as a libertarian?

Tim Andrews: Personally I think classical liberal,—libertarian in the US—perhaps would probably be a fair description of my personal political views.

Gary Bryson: What does libertarianism mean, then, for you?

Tim Andrews: Look, I once again note that there’s a difference between my personal views and the Australian Taxpayers’ Alliance. The Taxpayers’ Alliance is more of a broad taxpayer advocacy group. Personally, I believe that from a government perspective that people should be as free to live their lives as they choose, as long as they don’t directly harm other people, and the government shouldn’t be involved in trying to micromanage people’s lives. I think we were all given freedom of conscience and we should follow that. We should have certainly guidance from community groups, from institutions, from the church. And if we want to lead moral lives, we shouldn’t be forced by the government to do so.

Tom Switzer: (Addressing the group) We are leading the effort to fight the good fight on a low tax pro-growth economic reform agenda, because what Ronald Reagan, the great Republican president in the 1980s, once said about the government’s view of the economy, I think could be said today about the Labor Greens economic view of the economy. That is that: ‘If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidise it.’

Gary Bryson: Tom Switzer, editor of Spectator Australia, talking at the launch of the Australian Taxpayers’ Alliance. And we also heard there from Tim Andrews.



It is no robbery if princes exact from their subjects that which is due to them for the safe-guarding of the common good, even if they use violence in so doing: but if they extort something unduly by means of violence, it is robbery, even as burglary is.

Thomas Aquinas, Summa Theologica


Gary Bryson: The idea of tax as theft was one which perplexed the medieval theologian Thomas Aquinas. In posing the question, ‘Is every robbery a mortal sin?’ Aquinas made a key distinction between just taxation and what he termed ‘legal plunder’.

Christopher Todd Meredith lectures in the Department of Philosophy at Tulane University in New Orleans. He’s the author of The Ethical Basis for Taxation in the Thought of Thomas Aquinas.

Christopher Todd Meredith: The difference between just taxation and legal plunder has to do with the purposes for which the money raised is used. For example, if I am coming to you with a demand for money and I’m just using it to enrich myself, I’m a robber. But if I come to you with a demand for money and I’ve been providing a public service that couldn’t be provided privately, then a different sort of thing is happening.

Gary Bryson: If we look at Thomas Aquinas, what did he actually mean when he discussed ideas like taxation, because taxation in his time wasn’t quite the same thing as we know it today, was it?

Christopher Todd Meredith: Well, not quite. It was the money of various sorts raised by local princes in Europe. There were many more ‘states’ in Europe than there are now and taxation was much more permanently administrated. But nevertheless, princes did extract tribute from those below them and that is the kind of taxation that Aquinas is talking about.

Gary Bryson: And is taxation in itself just to Aquinas? And under what circumstances is it just?

Christopher Todd Meredith: Well, taxation in and of itself is not just, necessarily. Taxation is just for Aquinas when it is used to provide a public good. He uses what we call a ‘public goods’ argument for the permissibility of taxation: if there is a certain good—and for Aquinas this good the prince provides is peace—if there’s a certain good that is provided that everybody benefits from equally, that nobody could provide independently.

And, you know, I couldn’t start a peace business and charge everybody for increments of peace. Because that’s the case, we have this institution called the state and we have the prince, who’s in charge of maintaining the peace. And because he’s providing a service, he’s entitled to fair compensation for services rendered, and that’s just taxation for Aquinas. If the prince is merely enriching himself, or is using the money for some private good, not a public good, that would be an example of legal plunder for Aquinas.


What Aquinas challenges us to do is to examine our practice of taxation in light of the prohibition on theft, which I don’t think we ordinarily do nowadays. The assumption seems to be that if you get a majority in parliament or in congress or something, then whatever they vote is perfectly OK—you know, if they vote a certain tax to do a certain thing then if it’s democratically legitimate we ignore it.

But for Aquinas we need something more than that kind of thin legitimacy. We need a moral legitimacy, which is generated by the uses to which we’re putting our resources. For example, we have welfare programs that are state-funded nowadays; this would be an example of something I think—on my reading of Aquinas anyway—I think Aquinas would not be comfortable with at all. There’s a passage in one of Aquinas’ small writings where he says the thief, even if he gives his money to the poor, does wrong by stealing.

A lot of what governments are doing now involves giving money to the poor, and that’s something that Aquinas would flag and say that we’re engaging in legal plunder when we’re doing that.

Gary Bryson: Christopher Todd Meredith.

John Milbank has a noticeably different take on Aquinas and taxation, one driven by his ideas about just distribution, and a Christian vision of the economy.

John Milbank: In the Middle Ages, the whole business of welfare was distributed socially—you know, the church, lords of the manor and so on—it was a moral responsibility to look after the poor, no matter how badly that might have been done in practice.

What happened in early modern times was that all that collapsed and then the state had to kind of retrieve the situation. So first of all we have the Elizabethan Poor Law. So Thomas Aquinas never envisaged that situation arising. His general principle was that taxes are fair if a public benefit accrues back to you, including all taxpayers, if you like. Now if we’re talking about redistributive taxation that relieves poverty, you can argue that relieving poverty and thereby reducing crime and so on, does give a benefit to everybody. And in that sense you might argue that Aquinas in our modern circumstances would not have been against what we call redistributive taxation. But I think that Aquinas, quite rightly, believes in just distribution in the first place. And if we have that, then we don’t have the same need for redistribution.


Gary Bryson: While we can argue whether Aquinas would be against the kind of redistributive taxation we see today, he was, like most of us, in favour of a just and fair society. We understand our moral and ethical responsibilities towards creating such a society, but we disagree profoundly on how best to do it. A case in point is the issue of social welfare. Should this be funded by the taxpayer, or simply left to charity? It’s a question that stirs up key ideas in theology and philosophy, both on the left and on the right.

Tim Andrews and the libertarian view again.

Tim Andrews: I think that welfare is an issue on many peoples mind because it does take such a large percentage of taxpayer expenditure, whether it be unemployment welfare or the disability pension and other things, a redistribution of people that earn money to those who don’t—and the fact that there’s an entitlement mentality now that people expect other people to pay for them.

Stan van Hooft: One of the problems that arises here is how we describe it. If we describe it as welfare, as a safety net, as a way of saving people who are in dire need from poverty, even death—you know, freezing out in the streets for lack of a home and so on—if we describe it under the broad heading of ‘rescue’ then I think it’s hard to imagine anyone seriously objecting to it. I think it’s fairly clear that everyone has a moral responsibility to contribute to or to take part in the rescue of those people who are in dire need.

Tim Andrews: What I think is ethical is to give money to charity voluntarily. What I think is unethical is to lobby the government so that other people are forced to give money to charity. People seem to say… to go out in the media and say, ‘We need high taxes to pay for welfare,’ and they’re viewed as moral champions. Now, I’m sorry, that’s not moral, it’s not moral to force someone else to pay for someone else. That’s not moral. That’s not virtuous. What’s virtuous is to foster a spirit of voluntary giving.

Gary Bryson: Tim Andrews, and we also heard there from Stan van Hooft.


Charity is a central tenet of all the mainstream religions. So let’s step outside of the Christian frame for a moment to look briefly at the Jewish system of charity. Codified in Jewish law and collected by tithe, Jewish charity was never meant to be voluntary.

Michael Fagenblat lectures in Jewish civilisation at the School of Philosophical, Historical and International Studies at Monash University. He’s speaking to us here on the phone from Jerusalem.

Michael Fagenblat: By Jewish law, a person is obliged to give between 10 and 20 per cent of their income to charity. Jewish law flourished for the most part without the support of a political authority, an official political authority. So the relationship between charity and taxation is somewhat severed in the Jewish context for the most part. But there is certainly a very robust tradition of collective concern and the redistribution of wealth which goes back to biblical times.

Gary Bryson: So was the Jewish system of charity an early form of social welfare?

Michael Fagenblat: Jewish existence by and large, I think, thinks of itself in collectivist terms, as not just an aggregate of individuals but as a society that from the outset is constituted as a community who are responsible for one another. And in a certain sense there is more latitude in theology than there is at the level of society. In other words, the certain type of fidelity and commitment to the people with whom one shares one’s personal and political destiny is very much at the core of Jewish existence. So I think that this sense of mutual responsibility as constituting who one is, even as an individual—that as an individual one is in a certain sense defined through the network of responsibilities and obligations one has—is very much a part of Jewish self-understanding.

Gary Bryson: One of the greatest of Jewish scholars was Moses Maimonides, who lived and worked in the twelfth century.

Michael Fagenblat: Maimonides was extremely influenced by Arabic Aristotelianism. His great precursors here are al-Fārābī, Ibn Bajjah and other commentators on Aristotle from Islamic civilisation. And this Aristotelianism, this medieval Aristotelianism, regarded proximity to God as essentially the perfection of the intellect so far as it is possible. The intellect is essentially the principle of the image of God in the human being and perfecting the intellect is coming close to God insofar as it is possible. Maimonides says that without knowledge one cannot properly love God, for example. And so the vision of Judaism that he proposes is one which steers the people, and especially the intellectual elite, toward God by the improvement of their rational faculties.

And the whole of Judaism is in this respect interpreted by Maimonides so that the prophet, for example, appears quite like Plato’s philosopher king, as a person who’s mastered the intellectual faculties and is able to use that mastery for a social purpose.




Maimonides, Guide for the Perplexed.


Michael Fagenblat: The ladder of charity is a well-known tradition that Maimonides outlined. And essentially it’s a sort of eight stages of how we should think of giving, the bottom of which is a person who gives begrudgingly or unwillingly, and it proceeds with giving gladly, without being asked, giving without letting it be known that you gave. We see quite a lot today of named charities and we understand that people who give also want recognition for their giving, but Maimonides is quite clear that recognition is in fact a lower level of giving than the patron who gives without telling the world that they have given.

And the highest level of giving for Maimonides is a person who gives to someone not just in such a way that the person who receives receives a certain amount which may help them in a very provisional manner, but that the person is in fact empowered to look after themselves; so, for example, bringing someone into a partnership in a business, or providing someone with skills, providing them, for example, with the education to learn how to look after themselves. This is for Maimonides the highest level of giving, because it gives the person the capacity they need to look after themselves.

A very interesting part of Jewish law which Maimonides recognises also is that even the poor have to give. Giving is not just a function of need in the receiver; giving is also something that links us up with each other, I think, and in some sense constitutes our humanity. And so even the poor have to give to people who are more needy. There is always someone who is more needy, and Maimonides is very clear that no one should regard themselves as only a receiver.

Gary Bryson: Michael Fagenblat.


You’re with Encounter on RN, and we’re discussing ideas about taxation, and whether philosophy and theology can show us a better way to a virtuous economy.

Stan van Hooft: If you look at the broad tradition of political philosophy all the way from Plato through Hobbes and Kant, whom you mentioned, and Locke also, right through to today, a very strong preoccupation has been on the right to rule: what is the basis of civic and state authority. That’s been, if you like, a strong central concern, and when you look, for example, at Hobbes, who used this notion of a social contract, it’s largely that issue which he is addressing. The king, in his view, has the right to rule—indeed, he thinks the king has the absolute right to rule—because citizens have seen it to be in their interests, and especially in the interests of their safety, to hand over their authority over themselves to the king so that the king can maintain peace and civic order.

And so that’s been a very large preoccupation and it’s also been one of the meanings of the social contract. The social contract has been seen, especially by Hobbes, as a source of our security and of our safety. What I think Rawls does—and many other thinkers, following conservative thinkers like Hayek—is to indicate that a central issue in political philosophy is not only what is the basis of the rule of law, but also what is the basis and what is the nature of justice in a modern society.

Gary Bryson: Justice, equity, a fair go. Each of these ideas can be appropriated by opposite sides of the political fence, and very often are.

But is there a way of thinking about a fair society that takes into account both the desire for individual freedom and the need to provide for the less fortunate amongst us? This is something that exercised the mind of the political philosopher, John Rawls, who developed the notion of ‘Justice as Fairness’. Stan van Hooft:

Stan van Hooft: It comes out to a very simple scenario that he imagines. He imagines people coming together in order to form a society, to establish the institutions, the constitution if you will, of a society. And he imagines them from a position that he calls ‘behind a veil of ignorance.’ What that means is that people don’t know how they’re going to end up or in what socially defined position they’re going to end up in the new society.

So—he’s using American examples of course—so you don’t know whether you’re going to end up a white or a black in the society; you don’t know whether you’re going to end up a man or a woman; you don’t know whether you’re going to end up a Jew or a Christian; you don’t know whether you’re going to end up inheriting a huge amount of money or being born in a cardboard box in the street. You don’t know any of the social circumstances that usually go to define one’s economic and social status within a society.

And then you’re asked, ‘Well, what kind of institutions should this society have?’ Now, the first thought you’re going to have, being that you are a self-interested and intelligent more-or-less rational person, is, ‘Well, I’d better support only those institutions which ensure that the people who are worst off in the society aren’t all that badly off.’

 One of the premises that Rawls accepts is that there’s going to be competition in a society, because it’s going to be a free society, and that hence some people are going to be more successful than others. So disparities of wealth are inescapable, he thinks. So the question becomes what kinds of institutions should we then have to ensure that those disparities of wealth do not result in the poor and the disadvantaged being totally left out. And anyone in this scenario, behind a veil of ignorance, imagining themselves as the possible least-benefited by the system, will only agree to a system that ensures that that bottom line is adhered to.

Gary Bryson: If I can quote shamelessly from the Stanford Encyclopedia again, ‘Equality sets the baseline for Rawls; from there any inequalities must improve everyone’s situation, and especially the situation of the worst off.’

Stan van Hooft: Yeah, basically his position is that it would be terrific if you could have equality in a society, but you can’t have equality and also freedom. And the reason for that is that some people are more talented and more energetic than others. So if you have freedom, then very soon you’re going to have inequality, because some people are going to be taking advantage of others or engaging in commerce. You know, in the schoolyard some kids end up with more marbles than the others even though they’re all equally kids in the schoolyard.

So equality might be a starting point, but it can’t be an end point. And hence the question of justice isn’t simply answered by saying, ‘Well, if it’s an equal society it’s just.’ You’re going to have inequalities, so the question becomes under what circumstances is an unequal system nevertheless a just system. And his answer to that is that… there’s two parts to it: one, that the system is just if everyone in the system has an equal opportunity to take part in the competition—in the commercial and economic competition—so as to gain advantages for themselves and, secondly, it’s just if whatever wealth the rich people acquire also results in an increase in the welfare and wealth and general wellbeing of everyone, and in particular of those who are at the bottom of the heap after the disaggregation, as it were, that results from economic activity.

Gary Bryson: Did Rawls in any way openly support a redistributive tax system as part of his thinking?

Stan van Hooft: Um… but I think he’d be very careful of that word ‘redistribution’. For him it would be a matter of rescue for those who were absolutely down and out, and it would be a matter of justice in terms of giving equal opportunities. Now, giving equal opportunities is a costly thing to do. One of the ways that it’s done is through education and training; another way in which it’s done—perhaps not so direct but it’s still relevant—is through the healthcare system, because you can’t participate in economic activity if your health is poor.

So maintaining everyone in a more or less healthy and a well-trained well-educated position so that they can participate in economic activity is an important part of keeping a society just, but you wouldn’t describe that as redistributing wealth. What you are doing there is ensuring that there is, as it were, a level playing field so that the society is a just society.

Margaret Thatcher (archival): Some socialists seem to believe that people should be numbers in a state computer. We believe they should be individuals. We’re all unequal. No one, thank heavens, is quite like anyone else, however much the socialists may pretend otherwise. And we believe that everyone has the right to be unequal, but to us every human being is equally important.


Gary Bryson: The tension between the needs of society and the freedom of the individual has in many ways defined western politics since the industrial revolution. It’s a tension that points up the complicated relationship between rich and poor, and between the individual and the state. And it’s one that’s been addressed by theologians as much as philosophers.

John Milbank believes that what we think of as society was in a sense invented by the Christian church.

John Milbank: I think, quite simply, in the antique world that the social and the political and the religious all tended to fall together so that, you know, we have the tribe, we have the city, we had empires. What one didn’t have in a sense was society, or a place for free association; you know, people spontaneously getting together outside political structures and outside nakedly economic transactions.

But what happens under Christianity is that there’s an explosion of that realm of free association. And so you find, for example in Augustine, a recognition that the social is wider than the political. The political is one example of people coming together under a common object of love, but too often, as he also says, that can be a love of dominating other people, pursuing power, and so on.

But there are other reasons for coming together, like mutual charity, mutual assistance—all kinds of shared purposes. And I think the reason this happens under a Christian aegis is that the church itself is a mega international free association, that it transcends the political order. It’s not so much apolitical as trans-political, as exceeding the political. So I mean this is why it was so disturbing in the antique world. It crossed borders, it crossed religious and political borders, and finally the only way for the Roman empire to come to terms with this phenomenon was simply to embrace it, you know. There was in a sense almost no other solution, because it was a rival mode of being international.

So I think Christianity gives a new primacy to the social and the cultural, both at the international level and also at the level within and beneath the state.

Gary Bryson: John Milbank.


The idea of society demands that we give some thought to social relationships: to the way we interact, our ethical and moral responsibilities to each other. Here again, theology has something to teach us. Paula Clifford is Head of Theology at Christian Aid in the UK.

Paula Clifford: If you look at the theology of writers from Karl Barth onwards they start off with the notion of covenant with God, but taking it further back: not just the covenant that we’re used to in terms of the Old Testament—you know, people’s relationship with God—but Barth sees it as a covenant that goes right back to the moment of creation, where God sets up this special relationship with the human beings and with the created world.

If I believe that I’m made in God’s image, I therefore have a certain relationship with God. If you believe that you too are made in God’s image, then that creates a relationship between you and me, which equally has a relationship with God. And those relationships therefore impose some sort of norm, some sort of requirements as to how we deal with one another.

I’m using ‘relationship’ in quite a loose sense, because it not only covers relationships between individuals but it will cover relationships between us and the state, between us and the created world—so environmental questions—between groups of people. It’s open-ended.

Gary Bryson: And when we start to look at this in relation to something like taxation, or the ethics of a welfare state—those sort of questions—can we say that one of the key biblical injunctions around all this is, in fact, ‘Love thy neighbour’?

Paula Clifford: Yes, the whole thing, if you want to simplify relational theology down to the essence, it’s about loving God and loving your neighbour. And we do that through the relationships we create. And, you know, if the relationship with our neighbour goes wrong, then the relationship with God goes wrong as well.

Again, it comes back to this question, doesn’t it, of caring for the poor and the vulnerable in society so that those of us who are on the rich side of things—and unfortunately not many of admit to being rich, but those of us who earn enough to pay a slice of our income to the state, then that is surely a form of redistribution and a form of justice that we are through the state acknowledging our duty to the poor: allowing the state to do for us what we are not in a good position to do for ourselves, necessarily, or perhaps lack the will to do ourselves, which is to care for people who need to be cared for.

John Milbank: Ever since early modernity, we’re in a complicated situation where there is a kind of anomie, there is a kind of social breakdown, there is a collapse of people’s traditional responsibility for each other. So to some extent the state has to fill that gap and if you too readily dismantle that state protection, then you can too easily land up with something worse. But at the same time, the more sophisticated analysts on the left point out that, in the end, that kind of state welfare-ism is equally as impersonal as the economic and in the end tends to play the capitalist game, that instead of welfare being built into society and the economy, you get a reliance on the state to perform that role. So it kind of lets employers off the hook.

Paula Clifford: We sign away some of our supposed rights to the state and trust the state to do with our money what is appropriate, which is again a cause for some concern among some individuals in different places. But the question of big companies and their negotiations with the state again is very interesting. The state needs to be held to account by its own citizens in the way in which it negotiates its income from multinationals, whether they’re local to themselves or whether they’re international.

Clive Palmer (archival): We pay tax like everyone else at the normal rate. We also pay government royalties, payroll tax, GST and a whole range of other taxes— land tax. So we’re paying more tax than most people in the community. The more money we make, the more profit we make, the more tax we pay, like all Australians do.

Gary Bryson: That’s mining magnate Clive Palmer, who’s been highly vocal in his opposition to the government’s Minerals Resource Rent Tax, a tax on profits generated from the exploitation of non-renewable resources. But far from paying tax like all Australians, it was revealed last month that Palmer’s company Mineralogy paid no tax at all in the last financial year. All perfectly legal, but is it ethical?

Paula Clifford: This is a key instance of relationships breaking down, isn’t it, where people do everything they can to get out of their mutual responsibilities to one another and to the state. Rich people, rich companies will spend a great deal of money employing rich lawyers to find the loopholes and to move their money around so that they avoid tax, apparently legally, and ethically I think this is not acceptable.

Stan van Hooft: To minimise one’s tax within what is allowed by the law is one thing, to avoid tax is another. Avoiding tax is, in fact, illegal, whereas tax minimisation is not illegal. And of course a lot of people extrapolate from that and they say, ‘Well, if it’s not illegal then it’s not immoral either.’ And that, I think, is a rather subtle point and I think a very discussable one.

Gary Bryson: Tax minimisation strategies can embroil whole communities in questionable ethical practices. Think of tax havens, for example. Paula Clifford:

Paula Clifford: It becomes very difficult, because you are challenging the ethics of a community where that community depends for its livelihood on the activities of the big banks, the activities of all the offshore companies there. And what do we do about the people who are dependent on this for their livelihoods? You can’t ask them to move away from their home in order to work in a totally different part of the world where they might find the behaviour of the people they’re dealing with more ethically acceptable. So it is a problem that we need to explore much more deeply I think. But the sort of general principle, I think, is that tax havens are to a degree complicit in all this.

John Milbank: Once you’re given the idea that the economy is basically about pursuing brutal self-interest, what you can get away with and so on, people lose the sense of responsibility—a sort of philanthropic sense—that I think people had even up to the 1950s. You know, all this kind of thing has got far worse and we need governments to catch up with this kind of thing.

But there’s a limit to what governments can do. If we think of the economy as basically an amoral world, then people will find ways to abuse it. And so shifting the ethos is of even more importance than kind of legal guarantees and protection, even though we do need the latter.

Man (from advertisement): You can’t run. There is no place to hide. The crippling tax burden will close businesses. Hiring will slow. Government will grow. Personal freedoms will decline. It’s your money, but not for long. The tax man cometh.

John Milbank: The trouble with tax is you don’t know what proportion of tax is going on what, you know. And I think the more one can mitigate that, the more people really know what they’re paying for and what they’re getting back, the more it becomes an acceptable system. And I also think that a system that’s closer to a kind of reciprocity more encourages an interpersonalism within the system.

Gary Bryson: Tax is a necessary evil, a simple fact of life that’s recognised by everyone. Our political, moral and ethical beliefs will largely dictate whether or not we think our taxes are being wisely spent, or if our social democratic model of tax and welfare is working as well as it should.

But beyond the obvious polarisations of left and right, society and the individual, is there in fact a third way of thinking about this? John Milbank believes there is. He calls it ‘the virtuous economy,’ and it starts with reciprocity.

John Milbank: In the medieval and early Renaissance, cities hadn’t lost sight of this sense of reciprocal benefits; in other words, that when you made a contract interests of mutual honour and mutual help and social benefit entered into that contract. So by the time we get to Adam Smith in the eighteenth century, he regards it as self-evident that when you’re kind of buying meat from your butcher you don’t really care what happens to the butcher, you just want to get the best deal.

But this is by no means true of the way people habitually thought. It may not even be true of the way people in small communities think now: that an economic transaction could also be a social contract, in which you still want the butcher to be there, he’s also your neighbour, you want him to be able to survive, your kids may play with his kids. So why do we have this idea that an economic contract is completely corralled from the rest of life? This is artificial. It means that we must be thinking of people as strangers.


Gary Bryson: Let’s talk about a Christian notion of the economy and a social vision that goes beyond economics and politics. How should we understand this Christian notion of the economy?

John Milbank: I think there are two things at the heart of a Christian vision. First of all, the primacy of the social, the primacy of free association beyond the realm of the coercive law, or beyond the realm of naked economic self-interest. And secondly, I think the supremacy of the person: that the person is not a kind of substitutable atom; each person is of infinite worth as being in the image of God, each person is unique. But paradoxically, each person is unique because their histories are unique and because their set of relationships are unique. So the uniqueness of a person is tied to the relationality of people, and that points back, I think, to the idea of free association and the fact that it’s neither individualist atomistic nor collectivist; it doesn’t treat people en masse. So we have these twin ideas of free association and the primacy of the person making up the primacy of society.

And then I think we need to bend both our politics and our economics towards that primacy of the social. So first of all politics has to assist and encourage the primary social and cultural ties that bind people together. And I think an economy bent towards the social is what Stefano Zamagni has described as ‘a civil economy.’ What this means is that it has to become unacceptable that you’re just pursuing an economic purpose, pure profit alone, but we need, in law, to define a company as something that has to be pursuing a specified purpose of social benefit. And in this way we can pursue a third way that’s beyond the sort of state control of an economy on the one hand, but is also beyond the idea of the amoral free market on the other hand.

We need every business to be hybrid, to be pursuing both the social purpose and reasonable profits. We also need businesses to clump into voluntary guilds where there are principles of the standards of production, treatment of workers, consumers, and so on. This needn’t be coercive; it can become an economic advantage to belong to that guild, because if you have a badge—it’s like free trade—if you have a badge saying, ‘I sign up to those principles,’ then the consumer will choose that, because it knows you’re reliable. It’s like the famous example of the John Lewis store in Britain, the department store that treats its workers and its customers well, that only sells good quality goods; it has outcompeted its competitors for those reasons.

And I think we need to get towards the idea of an economy where it’s likely that you will succeed in market terms out of good practice, whereas at the moment, sometimes you can succeed more readily because of bad practice. We need to somehow persuade people that in the long run bad practice is going to lose out. We need, therefore, to encourage a different ethos, but we need also laws and government measures to be biased towards this idea of a virtuous economy, an economy of honour. In other words, it’s the entire idea that a contract can be about more than brute individual benefit and competition could be more [than] about profit; it could be a competition in honour, if you like. So a market can work differently, be a real, genuine social market.

Gary Bryson: And you would like to see the church much more involved in processes of welfare and medicine, banking, education, the arts, business, technology et cetera.

John Milbank: Absolutely.

Gary Bryson: How would that work?

John Milbank: Well, I think the first thing to say is that this is not unrealistic, that on the contrary, increasingly civil servants are realising the burden on the state can’t really be sustained. And they also realise that even though church attendance may be in decline, say in Britain for example, the two million-odd people who go to church represent the biggest sort of social civil society grouping, much bigger than people who belong to political parties, trade unions and so on. And the extent of church or other faith-based social activity is already immense.

And I think there are two important things here: first of all that a faith-informed social activity is likely to be more personal, likely to involve more personal care. It won’t ultimately be motivated by a sort of cold bureaucratic concern for the mere strength of the state, nor by just profitmaking; it’s much more likely to be interpersonal. And this can sometimes mean that you make demands on the people you’re helping as well as just helping them. In other words, you treat them with a load more respect. You treat them as genuine human beings capable of doing certain things.


If you’ve got an economy run on basically amoral principles—that relies on the constant generation of excessive profits—then it really is true that there’s a tension between gathering taxes and redistribution and economic health. So I’m kind of arguing that we really need to end that tension. I mean the state is always going to have a role in ensuring that nobody is left out, in providing a safety net and so on. And I’m not arguing for a kind of purism. I think that church and state need to cooperate. I’m arguing for a mixed system, if you like, not the church replacing the state or total voluntarism. But I am arguing that we need sort of mutualism even in the state system. And the church needs to encourage and support systematic social and economic activities that have justice built into them in the first place, because that’s much more stable than a constant Canute-holding-back-the-waves act, which is what state social democracy tends to involve. I’m arguing for something to the left of social democracy, on Christian principles.

Gary Bryson: John Milbank, with the final word on this Encounter on the ethics of taxation.

Readings for today’s program were by David Busch. Technical production, Timothy Nicastri, I’m Gary Bryson, thanks for your company.



John Milbank
Professor in Religion, Politics and Ethics, The University of Nottingham, UK
Paula Clifford
Head of Theology at Christian Aid in the UK.
Stan van Hooft
Professor in Philosophy, Deakin University, Melbourne
Michael Fagenblat
Tim Andrews
Executive director of the Australian Tax Alliance.
Christopher Todd Meredith


Gary Bryson

Comments (8)

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  • paul leonard hill :

    28 May 2012 9:32:39pm

    One hour of Christians spouting about equality in the distribution of wealth, plenty of quotes from Thomas Aquinas, yet not one single word uttered by Jesus who was probably the greatest champion of equality who ever lived, that's if you take his words literally.

    “Whatsoever a man soweth, that shall he also reap” (a fair day's pay for a fair day's work). “By the sweat of thy brow shalt thou eat bread" (not by speculation). From Socialist Luke, “He who hath much from him shall be taken and he who hath little to him shall be given” (redistributionist Jesus predicting his policy on taxation if he won the election). From Conservative Mathew, “Unto him who hath much shall be given more whilst he who hath little, even that which he hath shall be taken away” (by he who hath much via speculation. This is the way it is and what will be reformed). “Woe unto you Scribes and Pharisees, ye lay upon widows burdens ye yourselves would not attempt to lift” (being dispossessed with all of the inheritance going to the eldest son or the state if there is no eldest son. Thus the widow - Mary Magdalene? - is forced into prostitution to feed herself. Then when she gets found out is stoned to death. Great stuff!!)

    Now to the daddy of them all. “A certain man came unto Jesus and said 'What must I do to enter the Kingdom of God?' (Jesus's Party, or Heaven on Earth as we'd say today). Jesus replies “Go sell ALL that that thou hast, give the money to the poor, take up thy cross and follow me” ('ALL that thou hast' is based on the fact that almost all great wealth is unearned income, derived by some form of speculation. The rich man could doubtless keep enough to live on).

    Let's assume that on the road to becoming the Monarch, the individual would have to become Governor of a State, (e.g. Ronnie Reagan, Governor of California), then Jesus would have to become Governor of Galilee, and as there was no separation between Church and State he would be the chief Rabbi of the Pharisee Party of Galilee, his constituency. Thus in his three-year ministry he was on the hustings. He was forced into this position because his half-brother Judas, head of the Scribes Party, contested his right to the monarchy as Jesus had NO bloodline. Joseph was NOT his father but WAS the father of Judas, who was the same Iscariot (Iscarie, the Knife Assassin.) So Jesus, champion of fairness, suggested putting the leadership to a vote, the very beginning of democracy, our two-party system. Those tax collectors hanging around were working for Jesus in his caretaker role.

    Judas, having the 'bag' was the Treasurer of the Party. This was an (illegal) provisional future Gov't of Israel. The 12 were the provisional upper house or 'Little Sanhedrin' and the 70 disciples referred to in Mathew were the Provisional Lower house or big Sanhedrin....

      • ABC (Moderator):

        30 May 2012 10:24:00am

        Post cut off - messages over 3000 characters in length are automatically truncated by the system (as set out in "house rules"). Please keep posts reasonably concise.

          • paul leonard hill :

            30 May 2012 8:28:59pm

            I used Open Office to write this and, using Properties, was told that it was right on 3,000 characters, after going to considerable trouble to trim it. This is devastating having my comment truncated as it is brand new stuff worked out by myself after many years research. The 12 is obviously based on the 12 tribes of Israel, each with its own state, which in turn derives from the 12 city states of Ur of the Chaldees, from whence came Abraham. He had a vision of creating a state based on UR but with just one god instead of the dozens of UR and the attendant political fighting that went with it. The monotheism of Zarathustra seems to have the same origin as Abraham's.

            The 70 was originally the 72 'magistrates' appointed by Moses in the desert when the 12 'prince' judges couldn't handle the number of disputes and crimes which arose. Upper and lower house there in the desert 3,500 years ago, but very much a totalitarian state ruled by Moses and his brother. Jesus attempts to reform it by introducing the two party system, something forced on him by circumstances anyway. He does succeed in that the idea travelled through Gnosticism, went underground with the Albigencian massacre in France in the 12th century. It finally resurfaced as the underpinning of the Reformation, beginning 1513, thus destroying the totalitarian Holy Roman empire. Look at the steps. Lutheranismsm, divine right of Kings to rule free of the Papacy, US Episcopalianism, rule by the bishops free of the Archbishop, Presbyterianism (Methodism, Calvanism), rule by the Priest or Minister free of the Bishops and finally Congregationalism, the congregation having the vote in all important matters. This devolutionary process was mirrored in a secular way in Westminster. Thus Jesus's death on the Cross most certainly gave us the political freedom we take for granted today ,hence my enormous regard for him.

            Thus in my comment is, finally for the first time, the very derivation of Westminster's bicameral system of democracy and the two party State, something a bit too important to chop off at the knees. Please tell me what word processor you use to measure the letter count and what about putting the full version in just this once.

              • ABC (Moderator):

                31 May 2012 8:47:20am

                Hi Paul -

                Unfortunately the word count is calculated automatically (i.e. by a web-based system whose workings I'm not familiar with), and lengthy posts are thus already truncated by the time they reach me for moderating. Therefore I'm unable to retrieve the missing part of your original post.

                But many thanks for your comments, and apologies for the unintended edit. In future it's probably a good idea to keep posts on the shorter side, rather than to push for the 3,000 word limit.

  • Lloyd :

    30 May 2012 3:31:20pm

    I was in the car when I listened to this and I didn't hear all of it but I was amazed at what I heard. Here were people who have thought deeply about the ethics of taxation, yet still had no idea what justice and equality really is, or more importantly how to implement it.

    We don't need to question the role of market mechanisms or the government role in regulating the economy, we need both of those. The big issue we need to discuss is the system of property rights. Specifically we need to recognize private property in the things that we make but not in things that are a part of the natural world or created by society. So we are 100% entitled to the fruits of our labour, but we are not entitled to the capital gains of land, unearned income.

    It is possible to abolish all taxation and yet still have government revenue. This new system is called stewardship. Stewardship gives absolute possession of land but recognizes that land (not improvements on it) belongs to general society, and therefore a steward's responsibility is to give the rent of land to society, that's then the revenue government uses to cover its services.

    This one simple change to the rules of the economic game of life would completely transform us and our world, giving us the justice and freedom we seek. Share the earth, so we all may prosper.

  • JohnB :

    30 May 2012 9:57:23pm

    Someone famous once said that 'taxation is the price we pay for civilisation'. Sadly, there are many of us who need to be reminded of this, and of our responsibilities towards each other. Religious ideas help, as do ethical principles, but I wasn't convinced by the fellow who argued for handing over welfare, health and education to the Christian church. Give me an elected government every time. At least you can vote them out!

  • paul leonard hill :

    03 Jun 2012 10:45:35am

    Socrates said that a slave-based economy made no sense as the slave community was not a market for the goods they made as they received no income to purchase said goods. Jesus, being in a Hellenistic world, would have been well aware of this fact. When he said 'Whatsover a man soweth that shall he also reap,' he wasn't just talking about fairness, he was talking about what made economic sense. Today it's called Say's Law, named after the French economist, yet as basic as it is is NOT understood by economists. Before Keynes it was orthodoxy, but not practiced, otherwise there would not have been a Great Depression or any other depression. The consumer works for the producer, gets wages from the producer with which he or she purchases the goods made by the producer. Lower wages to reduce manufacturing costs to compete on export markets, with every nation doing likewise, you are lowering the aggregate global wages bill and thus shrinking the size of the global market for it's industrial output. The Roman Empire was very much a trading Empire. The only way to compensate is to free up credit so that the worker goes deeper and deeper into debt with all of its social consequences.

    Jesus may have also been talking about the little business person growing crops or making something on his or her OWN LAND, ie. self employed, in his case as a carpenter. Did he go bust at some time, 'He became poor for our sakes', and even homeless, 'The birds of the air have their nests, the foxes their lairs, but the son of man has nowhere to lay down his head' and thus be acutely aware of the enormous injustices of his time. Galilee was a center of an emerging petty bourgeoisie, self employed individuals clamoring for land reform. The Pharisees were a middle class party. No more master and slave. They bought slaves and allowed them to buy their freedom by working off their cost. No other party did this.

    However, as a bread basket, Galilee was secretly supplying food to the insurgency based at or around Qumran - rocky, hilly land protected by guerilla warfare and inaccessible to the Roman's heavy conventional weapons. If a farmer got found out, his house was burned down and his land seized. As well, the Sadducee aristocracy colluded with the Romans in seizing land around the Sea of Galilee to to build spas, i.e. holiday resorts. Many of the dispossessed joined the insurgency if they weren't executed.

    Thus we find so many in Jesus' party self employed, doctors, lawyers, tradesmen, fishermen etc. THIS WAS FREEDOM and almost unique in the entire Empire, but unsustainable given the rapacious greed of the Sadducee Roman pact, the insecurity and horrific anxiety, violence, high inflation and debt. Thus the ONLY way out of this situation was to start a non-violent revolution to reform the ENTIRE Empire, the model being Galilee, based on 'What profiteth a man if he gain the whole world but lose his soul (peace of mind).' What indeed!

  • paul leonard hill :

    07 Jun 2012 9:24:18pm

    Rumor has it that HM, as a devout Christian and head of the C of E, is about to actually take the words of Jesus seriously when he said that 'it is as difficult to for a rich man to enter the Kingdom of Heaven than for a camel to pass through the eye of a needle', and is about to 'go out and sell all that she hath, give the money to the poor, take up her cross and follow Jesus', who allegedly had something to do with inspiring the formation of the Christian Church. The REAL Jesus seems to have had a profound recognition that social stability and individual happiness was totally dependent on equality in the distribution of wealth. One could hardly call the poor homeless of Britian living in cardboard boxes at one end of the spectrum, with a choice of castles to sleep in at the other end, equality.

    The Monarchy is held up as force for social unity, as is evidenced by the riots a few months ago. Imagine how much worse they would have been if she hadn't been on the throne. If this is supposed to be an age of reason and scientific elimination of superstition, surely the most ostentatious display of wealth on Earth has become total anathema to said reason, and the inflammatory flouting of such indulgence might provoke more than just much worse riots next time but something akin to civil war, especially given the parlous state of the British economy. What if a Greek default sends a financial tsunami washing over Britain, worst hit Ireland? Doubtless Northern Irish Republicans (and Loyalists on the flip side) are preparing for for such an event.

    Thus I have a plan for HM to defuse the situation. As selling her castles, Rollers and the like would involve another rich person buying the stuff, and then he or she would have to do likewise ad infinitum, why not just give all this stuff directly to the homeless? Rollers could go pick them up at their cardboard box homes and transport them to the castles, which would have been refitted with many more rooms, each fitted out with furniture and new clothes, tele, stereo etc. Some of the buildings would be converted to workshops, so that these individuals could learn a range of skills and begin selling a number of their beautifully-crafted wares. Meanwhile HM could move into one of the outhouses (is that the right word?) and administer the whole shebang for a modest stipend.

    Civil war will have been averted, and Britain will flourish with zero unemployment and crime, a flower of true egalitarianism. HM having set such a splendid example and entered the Kingdom, the rest of the aristocracy would then be desperate to emulate her, so that they too could enter such bliss and inner harmony, and the Lion would indeed lie down with the Lamb. Isn't that brilliant.

    Please note that as an introductory offer, I will be available as a financial consultant at a discount rate of a mere million bucks an hour. Better hurry, as this offer closes yesterday.