Steve Horwitz on Corporate Personhood

Corporations are composed of people. So are unions. So are universities. So are families. The belief that we can somehow “tax corporations” without “taxing people” is the fallacy at the heart of Romney’s exchange. It’s the same with any collective: If we take away union rights, we take away the rights of individual union members. If we strip a university’s accreditation, we also strip credibility from its students and its graduates.

I am composed of cells. The belief that we can somehow tax me without taxing my cells is the fallacy at the heart of [something something.]

Is this not the fallacy of division? Why isn’t Steve’s version?

via Yes, corporations are people | The Daily Caller.

Author: Will Wilkinson

Vice President for Research at the Niskanen Center

11 thoughts

  1. And this seems like an “argument from fallacy.” Is it true that taxes on corporations will affect the (relevant) behavior of the people who control the corporation? If so, then Horwitz has an argument.

  2. It seems senseless to commit the fallacy of composition (let’s recognize the right-to-life of all Occupy activists who will die if they don’t experience fellation on a daily basis), or accept the legitimacy of their collective claim, and then worry about the fallacy of division.

    Why not strike at the root: Trying to attribute rights to collectives, inspired by our intuitive respect for the individual, commits the fallacy of composition?

    (I know, I know, it’s been done before… and by Ayn Rand, no less.)

  3. Perhaps the difference is that Horwitz is not attributing characteristics of the collective to the individuals (for example he is not arguing alumni can grant degrees or that union members can engage in their own personal collective bargaining sessions).

    Instead I read his article as arguing that removing the collective’s legal status impacts the benefits which those individuals derive from their membership in the collective. The rights someone gains through membership in a union (to collectively bargain) are different from the rights that same person has in his or her individual capacity (free speech etc.).

  4. The forms of “business” enterprises represent the extensions of human activities (including the degree of access to forming associations), they do not “represent” the human entities as such, only their activities.

    To some degree, but not perfectly, of course, the differences in the treatments (for different objectives) afforded various kinds of associations via the political processes reflect the relative importance of the human activities of whuich they are extensions.

    Avery mundane example in the U S can be seen in the differentiations in taxation “policy” amongst corporations, partnerships, and trusts.

  5. “Cell is to human individual as human individual is to collective” is not a very good analogy for these purposes. Consider that a cell’s only function is to comprise a human individual, and the cell has no meaningful individual existence of its own. But human Individuals exist outside of collectives, can join and quit collectives, can be members of multiple collectives, etc. So, false analogy fallacy.

    1. Cells can and do exist outside of the human body. They can grow in a petri dish, for instance. They require an environment conducive to their growth, but so do humans. (If you throw a human out into a barren wilderness, it will die.) The relationship between cells and humans and the relationship between humans and societies are obviously different, but it’s nothing as simple as that.

  6. Well… if the tax happens to keep me from buying certain food, or vitamins, or sunscreen, etc., my cells may indeed suffer and thus be ‘taxed.’

    But since cells can’t be taxed (nor can they have rights, nor receive accreditation), it’s a useless analogy. Ultimately, the money that is being taken through a corporate tax would have gone to some individual, whether to employees, shareholders or other businesses through investments. And given your ‘more substantive’ understanding of freedom, I imagine you would agree with Horwitz that, if the govt were to restrict a group’s rights, it’s restricting the rights of the group’s individual members.

  7. The fallacy of division doesn’t say the parts never have the characteristics of the whole, only that they don’t necessarily have them. I think Steve’s argument is specifically about groups of individuals, and the fact that something taken away from the group must be taken away from (at least some of) the individuals composing it.

  8. “If we take away union rights, we take away the rights of individual union members.”
    But we know that union leaders do not always represent the interests of union members. Thus, vast sums of union money are given to support the Democrats, despite a large percentage of union members who have different political preferences. Union leaders are also more concerned about building their own power and lining their own pockets than they are about the livelihoods of union members. They do just enough to please the rank-and-file, without necessarily providing wise leadership that leads to long-term benefits. Witness the loss of many industries that have moved overseas because union demands made it impossible for businesses to operate at a profit.
    So yes, the argument is based on a logical fallacy.

  9. Genuine question: if the government taxes you, how is it not taxing your cells?

    Now, some of your cells may bear the burden more than others, eg if you pay your taxes by maintaining your food consumption unchanged, but cutting back on your entertainment budget, the change might affect your brain cells more than your leg cells. But I don’t see how it avoids taxing your cells, in the sense of making some of your cells do without things they would otherwise have had. (Of course, if the government is efficient then what it spends the tax money on should more than make up for it).

    As Glen says, the fallacy of division is an informal one, sometimes for something to be true of the whole it must be true of some of the parts.

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