Many Ontario residents who have worked hard, lived frugally and invested intelligently breathed a sigh of relief last December when the report of Ontario's Fair Tax Commission was released.  Abandoning the trial balloon they had sent up in their discussion paper nine months earlier, the Commission recommended against rushing into a provincial wealth tax.          

Unfortunately, though, the reprieve appears to be only temporary.  The report shows that the Commission gave up on the idea of a wealth tax for precisely the wrong reason.  In their never-ending quest for what they call fairness, they did not decide that a wealth tax would be unfair.  They decided only that it would be too easily avoided if imposed by Ontario alone.  What they recommended is a national wealth tax that would be much harder to escape.

Wealth taxes have become the latest infatuation of the left--especially, it seems, of law professors.  One example is Maureen Maloney, formerly Dean of Law at the University of Victoria and now a deputy minister in the B.C. government.  A flattering profile of Ms. Maloney, published in Canadian Lawyer's August/September 1993 issue, reported that she garnered a lot of public cricitism when "the press got wind of her writings on wealth taxes, which included the observation that much wealth is inherited."

With all due respect to the author of that profile, I would suggest that the bad publicity had more to do with Ms. Maloney's "observation" that "wealth and indeed large incomes are rarely the result of individual hard work or effort."  Or perhaps it had something to do with her "observation" that the success of most individuals who didn't inherit their wealth is due to "fate or, more simply, sheer luck."

Another example is Neil Brooks, a professor at Osgoode Law School and--surprise, surprise--Vice-Chair of the Fair Tax Commission.  In a debate entitled "Capitalism Versus Socialism: Which Is the Moral System?" held a few years ago, Professor Brooks (debating for the socialist side) said, "It's indisputable, it seems to me, that returns to capital and labour are dramatically affected by luck."

One can't help wondering whether these people (especially Ms. Maloney, who describes herself as a workaholic) believe that their theory of success in financial spheres also holds true for success in academia and in obtaining political appointments.  If so, then there would be no reason for anyone to heed their arguments.  After all, they got to be law professors and political appointees by sheer luck, and not because anything they had said or done was particularly meritorious.

According to Professor Brooks (I'm paraphrasing here), luck undermines the theory that capitalism rewards people proportionately to their contribution to society.  He suggests that since we can't equalize people's innate endowments of talent or ability, we should at least equalize their rewards. 

Translated into action, this means that we should spread the good luck of the successful around by giving some of their money to the unsuccessful.  Another way of looking at this would be to say that we should spread the bad luck of the unsuccessful around by inflicting losses upon the successful through taxation.

Now, keep in mind that Professor Brooks is supposed to be one of Ontario's top policy-makers on fairness.  Fairness is supposed to have something to do with justice, with right and wrong, with morality.
 
Even if we concede, for the sake of argument, that he's correct about the enormity of luck's role in determining wealth, there's still a big difference, morally, between a hardship that is visited upon you by an act of fate and one that is visited upon you by an act of your fellow man.  The former is morally neutral.  Luck is not a moral actor.  Fate is not a conscious entity capable of making deliberate choices.

The acts of men and governments do have moral content.  Men make conscious, deliberate decisions about how they will act.  That, in fact, is what morality is all about.  And surely we can only call an act by which some men inflict deliberate harm upon lucky but otherwise innocent strangers morally wrong.

Then there is the thorny question about how to treat those few rare individuals--I think even the professors would concede that there are some, or I could introduce them to a few if they'd like--who have dragged themselves up from the gutter to the good life through sheer, dogged effort, will-power and self-denial, despite horrendously bad luck.  Should the wealth tax include a character test to exempt such "deserving rich" from its reach?

Of course, there is lots of room to dispute just how large a role luck really plays in determining wealth--not only in gaining it, but also in keeping it.  Imagine two siblings who inherit their father's fortune.  The son squanders his share on booze, drugs and prostitutes, and becomes a derelict.  The daughter invests hers and becomes even richer.  Her reward?  She pays a wealth tax, to be used by the government to fund a rehabilitation centre for people like her wastrel brother.  Is this fair?

No, when the wealth tax comes, it will simply be a matter of the state's grasping pragmatism cloaked in the rhetoric of fairness.