In response to my criticism of conservative Members of Congress for supporting H. R. 1380, which I have nicknamed the T. Boone Pickens Earmark Bill, some conservatives (in which broad category I include libertarians and advocates of free markets) have defended tax credits, even those that benefit only narrow interests. They do, after all, reduce some people’s taxes, and reducing taxes is a good thing. Some even go further and define ending tax credits as raising taxes. Some anti-tax groups thus demand that elimination of any tax credits be matched with tax cuts somewhere else.
The conservatives who make these arguments do so because they have unknowingly accepted the world view of the left. They have forgotten that the Constitution was designed to maintain a nation of citizens rather than to create a government with subjects. They ignore the essential role that the equal protection of the laws fulfils in maintaining the rights of citizens against the encroachments of government.
Tax credits (also known as “tax expenditures”) for buying or producing certain goods and services rather than other goods and services are a species of wealth re-distribution. Tax credits are a particularly obnoxious type of wealth re-distribution because the re-distribution generally flows from the politically less powerful to the politically more powerful.
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