[Newspoint] The moral imperative

I don’t know how long I’ve been hearing the admonition that a wealth tax is simply the most righteous imposition in a society so unequal as ours. And I’m hearing it again, from a constant admonisher himself, the economist and political scientist Sonny Africa, executive director of IBON, a nonprofit that has made the rich and other establishmentarians generally uncomfortable because of its progressivist outlook. 

I myself have always held that it’s precisely the outlook suitable for our situation, where the rich get richer, while the poor have remained poor and their already teeming ranks are joined yet by those demoted from a progressively slimming middle class. It’s a situation perpetuated by a culture that has entrenched political dynasties in wealth and power and institutionalized official corruption.

Sonny Africa is about the same age as my eldest, two generations removed from another economist with whom he is unsurprisingly  familiar — the late likeminded Alejandro Lichauco. He tells me that Ding Lichauco’s “were among the first lucid accounts on nationalist economics” he read. 

Lichauco was, indeed, known as the nationalist economist — for the same reason that Renato (“Tato”) Constantino, a contemporary of his, was known as the nationalist historian (The Past Revisited, The Continuing Past). Indeed, it was their “nationalist” appellation that detractors — those audacious enough among them, anyway — seized as an excuse to take them on. The point of their criticism, which might have looked good on paper but definitely proved puerile in practice, was that economics and history should be pursued as neutral disciplines, unadulterated by any point of view, never mind if democratic or patriotic.

Drawing a comparison from my own profession, it’s not unlike reporting the news in its barest, without comments or annotations or, if you like, any additives, however relevant or clarifying or otherwise likely useful in the distillation of public issues. The fear is that any sense of objectivity observed in the reporting would be lost by dilution, as if it’s not automatically lost once news is separated from reality and recounted verbally.

Although definitely a standard for hard science, a standard established by quantifiable factoring and working formulae, objectivity doesn’t work in undertakings proceeding from mere assumptions, as is the case with economics and other social sciences. 

Anyway, I caught Sonny Africa on television last week speaking to the prospect of an oil-import squeeze and a consequent spike in prices, not to say, a potential world recession, all resulting from the current Middle East war. As a reflex exigent measure, our own government is resorting to subsidy and looking to reduce or suspend the excise tax on oil products.

As a longer-term measure and for greater economic flexibility, Africa again urged a wealth tax on billionaires, singling out the top 15 for starters — I presume he was referring to the 15 Filipino dollar billionaires on the American magazine Forbes’ list. If it were up to me, I’d go down to the last billionaire. Surely, one billionaire in a dire setting like ours makes for enough obscenity. 

Africa also pointed out that the 20-25% tax on corporate net income is avoided by willful misrepresentation, resulting in a loss to the government of up to 12%. A good part of that loss, by simple zero-sum reckoning, could not but have gone as ill-gotten profit to our billionaires, among other opportunists, given such definitive evidence as has lately come to light of a readiness among our officials to conspire, for kickbacks, with anyone dealing with the government, whether contractors or big taxpayers.

All this time, our obscenely rich have managed to part with some of their money for charity on their own terms, through foundations. Still, this supposedly nonprofit initiative actually works more as an image-building trick for them than in narrowing the wealth gap: it advertises a dubious virtue, and, far more profitably than that, it works as a tax hedge. It is put to absolute shame by the village pantries put up unbidden by middle-class and just-well-off-enough groups for the poor starved during the pandemic lockdowns.

The fact is that our billionaires are not held to legal account by a tax that should curb their compulsive excesses. The default has led to a spectacular failure of the theory that prescribes leaving the control of the wealth tap in the hands of the wealthy, for, sure enough, they have allowed no more than a trickle where a munificent flow is owed the poor as a long-standing moral debt.

Any wealth tax is bound to inspire the paralyzing argument that it opens yet another opportunity for corruption, whether by straight stealing or conspiratorial bargaining. Since any income-generating effort by the state potentially does that, It’s an argument that implicitly promotes the lopsided status quo.

To be sure, there ought to be no compromise in the campaign against  corruption — it’s all part of the moral imperative after all. But lest the end goal be overlooked in the confusion of our moral priorities, that goal is to manage the wealth gap — to lift the poor to levels of contentment set to established standards of decent living that, at the minimum, guarantee the right to shelter, education, health care, pensions, and, yes, emergency subsidies.

My resident all-round advisor tells me that her own take on the wealth gap comes from her grandfather: “Anything you take in excess of what you need is a loss to the truly needy.” – Rappler.com