Reno on Free Markets and Post-Modern Relativism

In his column today On the Square , Professor Reno considers a recent editorial from the Wall Street Journal and concludes that he can detect “a fundamental agreement between free market libertarians and postmodern relativists” because free-market libertarianism “denies . . . that human beings have a natural end beyond economic self-interest.” Happily, Professor Reno is not offended when I disagree with him, and so I say quite frankly that he has misread the editorial and then grossly misinterpreted it.

The editorial was criticizing a proposal by Rick Santorum to expand the child tax credit from $1,000 to $3,000 per child, not because the editors think government should be neutral on the question of whether people should have children but because they think special provisions in the tax code are the wrong way to encourage such behavior . This is apparent on the face of the article, for after the sentence Professor Reno quotes, the article continues as follows:

Mr. Santorum is essentially agreeing with liberals who think the tax code should be used to pursue social and political goals. Yet a major goal of tax reform is to make the tax code less of a political free-for-all. The best tax code is one that raises the revenue the government needs with the least amount of economic harm and misallocation of resources.

The idea here—and it’s a very familiar one—is that social and political ends should be pursued through other forms of legislation, not the tax code, because tax law provisions that aim at social or political ends usually fail to achieve them and often create other costs in the process. For example, the child credit (whether $1,000 as under current law or $3,000 as under the Santorum proposal) is almost certainly too small to have a meaningful effect on how many children people have (and thus fails to achieve its stated goal), and its existence complicates tax returns and is an invitation to fraud (as when divorced parents each attempt to claim the credit for one and the same child).

One can dispute whether the tax code is or is not the appropriate instrument to pursue social and political policies, but to interpret someone who says that the tax code is not the appropriate instrument to pursue such policies as saying that we ought not have such policies at all is, at best, gross misinterpretation. Even the staunchest of libertarians, such as Milton Friedman, are on record saying that other forms of legislation, such as transfer payments, are the way to pursue such policies. To take a further step and say that, if a person thinks that government ought not meddle in certain issues, the person must hold some kind of philosophical relativism on such issues, is just silly. For example, I’m sure that Professor Reno thinks that the government should stay out of most religious controversies. Does this mean he thinks that there is no objective truth in religion? I’m pretty sure he doesn’t. The question of whether there is an objective truth, or an objective right or wrong, on a certain issue is one thing; the question of whether the government should be involved in affecting people’s behavior in relation to that issue is quite another. The whole idea of limited government is that there are certain issues, including very important ones, with which government should not be involved.