Conflict and Harmony in Taxation

Author(s): Roy Blough

Source: Proceedings of the American Philosophical Society, Vol. 88, No. 1, Symposium on
Taxation and the Social Structure (Jun. 16, 1944), pp. 22-28
Published by: American Philosophical Society
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 CONFLICT AND HARMONY IN TAXATION

ROY BLOUGH

United States Treasury Department

(Read February 18, 1944, in the Symposium on Taxation and the Social Structure)

TAXATION is an instrument of organized so-
ciety. Itself a social institution or group of
institutions in the broad sense, taxation exists for
the service and promotion of other institutions;
in and of itself it produces no personal or social
utility. Accordingly, the system of taxation
rests on the political, economic, and social struc-
ture and should be fitted to that structure and
adapted to achieving the ends and objectives of
the society. Such adaptation does occur, al-
though sometimes belatedly. Thus the general
property tax served an undeveloped agrarian
America but decayed with the rise to dominance
of commerce, industry, and finance. A very
current example is presented by Soviet Russia.
As long as Soviet Russia followed a policy of
equality of incomes, it used the sales tax almost
exclusively, but in recent years, when a policy of
unequal incomes has been increasingly accepted,
the progressive income tax has been adopted.
But taxation is no passive instrument. It
exerts an active force of such strength that it
inevitably affects the social structure and may
importantly alter the course of social evolution.
Annual wartime tax collections of 50 billion
dollars-virtually as much as the total national
income during the depths of the depression-
cannot avoid having a major impact on social and
economic life. Post-war peacetime taxes will no
doubt be substantially lower than wartime taxes,
but they can scarcely avoid being so high as to
contain an important key to the production and
distribution of wealth and income. The effects
of such taxation cannot be kept neutral. The
potency of taxation is so great that it may be and
indeed continually is used as an instrument for
mlaking changes which politically dominant
groups believe should be made in the social
structure. The first Federal revenue act, that
of 1789, was for the promotion and protection of
industry as well as for the raising of revenue.
Accordingly tax policy is not something to be
considered as a separate, independent subject.
It is an integral part of general social and eco-
nomic policy. Likewise the study of tax policy
should not be approached from only one side,
such as economics. Adequate consideration of
tax policy involves, in addition, ethics, law,
political science, sociology-indeed every point
of view from which the social structure may be
studied.
The operations of a tax system involve at least
two levels of activity. The first level comprises
all the things that happen up to and including
the point where the tax is collected from the
taxpayer. This includes the passage of laws,
their interpretation and testing by the courts,
and their administration. The second level of
activity comprises the economic reactions to the
tax by the taxpayers. These reactions may re-
sult in the shifting of the burden from the
taxpayer and in a variety of other economic
effects. These taxpayer reactions and their
repercussions constitute the chief subject matter
of the economics of taxation. Governmental
policy has relatively little power over taxpayer
reactions except as economic institutions and
operations in general may be affected by the eco-
nomic policy of the Government.
To achieve its purposes, tax policy, executed
through governmental action, must anticipate
and allow for shifting and other economic effects.
Wide variations' exist in the effects of different
taxes, depending on the tax and the circum-
stances under which it is collected. Accordingly
a knowledge of the economics of taxation, as well
as of the interrelated intricacies of tax laws, is
obviously of primary importance if desired tax
results are to be achieved. The translation of a
tax policy into a tax program involves what may
be called tax engineering. Just as an electrical
engineer uses the scientific knowledge at his
disposal in the building of an electric motor to
certain specifications of size, weight, speed, horse-
power, etc., so in the tax field the specialists who
are sometimes called "tax experts" I face the
1 The term "tax expert" is generally considered odious
by the persons thus designated, but it is too widely used,
especially in Congressional circles, to be ignored.

PROCEEDINGS OF TIlE AMERICAN PHILOSOPIlICAL SOCIETY, VOL. 88, NO. 1, JUNE, 1944

22

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 CONFLICT AND HARMONY IN TAXATION 23
problems of designing measures and devices for
achieving the purposes and objectives of tax
policy. This process of tax engineering is a vital
element in the design of a good tax system.
Much of the failure of our tax system to carry out
tax policy effectively can be attributed to an
unwillingness on the part of policy-makers to
allow tax experts an opportunity to perform their
functions. In candor, it must be said also that
much of the failure is due to bad tax engineering.
Although tax engineering is an important and
necessary part of the process of adapting the tax
system to changing conditions and points of view,
its function is to carry out, not to formulate basic
tax policy. The tax engineer can do nothing
until he knows the purposes which the policy-
makers desire to achieve. This necessary de-
termination of objectvies is not a simple problem,
to say the least. In taxation, as in every other
field of policy, it is not possible to have all of the
good and none of the bad. Tax objectives com-
pete with each other and interfere with each
other. An increase in tax equity may involve
greater complication for the taxpayers and greater
difficulty for administrators. Conversely, the
simplification of taxes will almost unquestionably
involve some loss of tax equity. Similarly, tax
equity may be in conflict with some economic
purpose, such as the control of inflation or the
promotion of industry. The weighing of these
considerations and the choice of a pattern of
objectives calculated to produce the maximum
benefit is a major problem of policy determination.
But the most important reason for the diffi-
culties of tax policy formation grows out of a
basic fact that within the social structure are
harmonious interests and conflicting interests.
Conflict does not mean-at least not usually-a
battle to the death, but rather a situation where
one person's gain is another person's loss, while
harmony is a situation where one person's gain
may also be another person's gain with no one the
loser. Conflict and harmony in the social system
are analogous in certain respects to the forces
operating in the solar system. If the solar
system is to exist, there must be forces pushing
the heavenly bodies apart and forces pulling them
together. The gravitational forces must be
stronger than the centrifugal forces if the planets
are not to rush madly into empty space. Like-
wise in the social system both conflict and har-
mony are inevitable, but harmony must at
bottom be the stronger if society is not to be
reduced to anarchic chaos.
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CONFLICT OF INTERESTS
In taxation conflicting interests are very
powerful. Evidence of the existence of tax con-
flict is inescapable to all who may observe the
intense differences of tax opinion, the contra-
dictory tax programs of different groups, and
even so small an item as the amount of Washing-
ton hotel space preempted by tax lobbyists. To
those in position to follow closely the policy-
making process, evidences of conflict are often
very painfully clear.
The reasons for the strength of conflict in tax-
ation are fairly obvious. Broadly speaking,
there is harmony of economic interests in the
achievement of maximum production, and there
is conflict of economic interests in distributing the
product among those who joined forces in the
productive process. Taxation is part of the
process of distribution-of what is commonly
referred to as secondary distribution.
Conflicting interests are stronger in taxation
than in most aspects of distribution, because in
taxation there is little or no relation between the
amount of taxes a person pays and the amount of
benefits he may derive from Government. If a
person is able through a change in law to transfer
part of his burden of taxation to the backs of
others, there is no resulting loss to him in the
form of a reduction of governmental services.
Moreover, the tax bargain, if it may be so desig-
nated, is in the political field, and there are no
economic acts of the individual whereby he can
affect the amount of his burdens by withholding
goods or services from the market. This applies,
of course, to the first impact of the tax; he may
to some extent be able to affect the subsequent
shifting and incidence of the tax; but it is in the
political field that the conflict principally appears.
Major conflicts of interest over tax policy arise
primarily because persons are in different eco-
nomic positions or different geographical juris-
dictions. Perhaps the most important economic
difference is that based on the volume of wealth
or income, which is reflected in the conflict of
interests over the progressiveness of taxation.
The change in three decades from the regressive
Federal taxation of pre-income-tax days to the
highly progressive income taxes of today was
highlighted by many struggles.
While the emphasis in tax discussions has been
largely on differences in the amount of wealth or
income, other economic differences also give rise
to conflicts of interest over tax policy. Thus,
 24 ROY BLOUGH
there are differences in the source of income: a
person may derive income from property alone or
from personal effort alone, or from various pro-
portions of property and effort. There are differ-
ences in the occupation and the industry from
which income is derived. Differences are like-
wise present in the forms of wealth, especially
between tangible and intangible property. Other
differences concern the disposition of income be-
tween consumption and savings, among various
kinds of investments, and among various types of
expenditure.
Conflicts of interest in taxation arise also from
geographical differences, that is, differences in the
political jurisdictions in which people live. Re-
sponsibility for financing the activities of govern-
ment is divided among some 175,000 jurisdictions.
All persons living within any one political juris-
diction have some interests in common which
conflict with the interests of persons in other
jurisdictions.
An individual is not limited to only one interest.
He always has at the same time several kinds of
economic and geographical interests, each in
common with various other individuals. Thus a
manufacturer who has an additional income from
corporate stocks and owns his own home has cer-
tain interests in common with real property
owners in general, certain other interests in
common with manufacturers, others with owners
of securities, others with the corporation in
which the stocks represent equity, and still others
with consumers in general. He also has interests
in common with other persons in the same po-
litical jurisdictions-city, county, and state
regardless of the relative economic situation of
those persons. His interests and outlook are
thus not unitary; he is drawn in opposite direc-
tions by his competing interests. In taking an
intelligently selfish stand on questions of tax
policy, his position will depend on the evaluation
that he makes of his competing interests. Rela-
tive values of these interests to him may change
from time to time, thus changing his attitude
toward tax policies.
This' conflict within each individual prevents
the tax struggle from being a clear-cut fight with
every person permanently lined up on one side or
another. In many kinds of tax questions, the
balance of interests will be so close that a large
number of individuals will be relatively neutral.
This group of neutrals often holds the balance of
power between conflicting groups and thus is for
practical purposes the public. Although the
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true public is commonly at least a majority of the
people, the effective public in any tax conflict is
this group of relatively neutral persons. The
composition of the effective public group may
change with each succeeding tax issue.
Although no two persons are likely to have the
same pattern of economic and geographical in-
terests except by accident, there are degrees of
similarity and contrast. Since political power
largely determines tax policy, persons with like
interests tend to form groups for the more
effective expression of their opinions. These
groups have varying degrees of effectiveness in
dealing with the makers of tax policy, but in
general have a great advantage over persons not
working through group organizations. On the
geographical side, unity and conflict of interest
are formally recognized in the system of repre-
sentative government under which representation
is based on geographical districts.
HARMONY OF INTERESTS
The spectacular nature of conflicting interests
in taxation tends to obscure the presence of
harmony of interests. Some harmonies are di-
rect and obvious. Nearly everyone prefers cer-
tainty to uncertainty and confusion in the
amount of his taxes. Nearly everyone is bene-
fited by a low cost of tax administration and low
cost of compliance.
Other harmonies underlie apparent conflict or
at any rate set limits to the conflict. For ex-
ample, a high protective tariff on manufactured
products might so destroy the foreign markets of
domestic farmers and diminish their purchasing
power as to affect adversely the markets of manu-
facturers with the result that manufacturers
would really be better off with lower tariffs. In
this case there is an area of conflict between
farmers and manufacturers, but beyond a certain
point the conflict may be replaced by harmony,
since both may benefit from the same policy.
Another type of basic harmony is inherent in
the concept of tax justice. Although what is
just is a matter of opinion, there is a good deal of
agreement over large areas. Justice is a moral
end or objective, and its violation outrages the
moral sense of people. Moreover, good will
among various groups in society is necessary to
the effective functioning of economic organiza-
tion. Flagrant injustice in taxation destroys
good will and leads to destructive antagonisms.
Taxes imposed by the political power of one
group may so destroy the good will of other
 CONFLICT AND HARMONY IN TAXATION 25
groups that the harm from the resulting non-
co-operation more than wipes out the advantage
to the apparent beneficiary. Some superficial
advantages that an individual or group might
obtain by political force always must be sacrificed
in order that there may be peaceful and orderly
political, social, and economic relations through
which greater advantage for all may be secured.
Still another kind of harmony is based on the
interest which the members of a group seek not
each for himself but each for the whole group.
Such group loyalties or common interests usually
arise when the group is in conflict or in competi-
tion with other groups, and the loyalties tend to
disappear in the absence of such conflicts or
competition. For the nation as a whole this
kind of harmony in taxation has proved difficult
to achieve even during time of war when national
unity is greatest.
CONFLICT, HARMONY, AND TAX ISSUES
Problems of forming tax policy take the form
of tax issues. A tax issue involves choosing
among alternative courses of action with regard
to any of a large variety of tax questions such as
the total amount of taxes; the types of taxes to
be employed, the relative emphasis on each type,
rate schedules, and exemptions, as well as per-
centage depletion, basis for gain and loss, in-
vested capital credit, contemplation of death,
pay-as-you-go, floor-stocks tax, definition of
proof gallon, powers of appointment, withholding
certificate, post-war credit for the Victory tax,
carryback of losses, and many other technical
matters.
The absence of a tax issue in a certain area does
not necessarily mean that no conflict of interest
is present. Tax issues do not ordinarily arise if
the interests of a very small minority are op-
posed to those of a large majority. In such
a case, the decision is taken for granted and no
problem is recognized. The minority feels its
helplessness and does not even bother to raise the
issue. The possibility of favorable action may
be so remote that they do not even think about or
recognize their own interests. Issues come to
the foreground only when opposing groups are
of substantial size.
Tax conflicts may present themselves in vari-
ous forms. Two group interests may be pitted
against each other, or one group interest may be
pitted against the combined opposition of several
other groups, or one group may be struggling
against the inertia and passive resistance of the
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remaining groups. There need not necessarily
be an apparent, direct clash between groups.
The issue is perhaps more likely to take the form
of one group demanding that its taxes be lowered
or not raised, as the case may be. Representa-
tives of such a group commonly say they have no
desire to increase the tax burdens of anyone else.
This is no doubt often true. Nevertheless the
tax burdens on others must be raised, eventually
if not immediiately, to the extent that the burdens
of the particular group are lowered. This con-
clusion rests on simple arithmetic, but if it were
appreciated fully, there would be fewer cases of
especially favorable treatment in the tax law.
The apparent tax issue is not necessarily the
real one. For example, the total amount of
taxes to be raised is an important issue which
often conceals more basic issues. Thus, high
taxes are often opposed when the real issue is
the volume of governmental expenditures. This
appears to have been an important factor in the
attitude of the Congress towards the recent pro-
posals for more than 10 billion dollars of new
taxes. The issue of the volume of taxes may
also conceal basic conflicts of interests over such
apparently extraneous matters as the desirability
of inflationary price rises or other economic
effects which might come from higher or lower
taxes.
The issue of the proper use of the taxing power
also commonly conceals some other issue. An
examination of the circumstances under which
various groups oppose the use of the taxing
power for other than revenue purposes makes one
justifiably suspicious of arguments in this field.
Many such opponents are undoubtedly sincere
and not motivated by narrow self-interest. Too
frequently, however, the real objection to the use
of the taxing power for some social or economic
purpose is that such use would be contrary to the
objector's self-interest. The conflict of interest
over the social or economic result of tax policy is
concealed under the guise of an objection on
grounds of principle, the principle being that the
taxing power should not be used for any purpose
other than revenue. When the shoe is on the
other foot, however, and the use of the taxing
power can be made to bring advantage to their
group, little difficulty is found by such persons in
supporting the measure. Highly technical pro-
visions of the tax laws may constitute important
issues in this respect, because through such
provisions, which may be entirely incompre-
hensible to the general public, special benefits in
 26 ROY BLOUGH
form of special low rates or exemptions are fre-
quently extended to special-interest groups.
Tax issues also arise where there is underlying
harmony. In this case the problem is a soluble
one, at least in theory, depending for solution
only on an understanding of the facts and on the
application of proper tax engineering techniques.
It is soluble because there is a one best answer to
the problem. In case a tax issue is based on
conflict, however, the issue is essentially insoluble.
There is no one demonstrably best answer, be-
cause a good answer to one person may be a very
bad answer to another.
THE POLITICAL FUNCTION AND THE
PUBLIC INTEREST
Still, there must be an answer. It is this
necessity for an answer that makes political
action, that is, policy-making, a vital function.
The function of the policy-makers is to decide
among the conflicting interests with respect to
any particular tax issue.
The test of good tax policy is whether it is in
the public interest. What is in the public
interest is good, what is against the public interest
is bad. Where the interests of all of the people
are in harmony the public interest is easy to
determine, since it is the common interest of all.
Where there are conflicts of interest, however, the
public interest is not so easy to determine. Yet
the public interest must somehow be located in
the maze of conflicting private interests. Where
there is a clear majority of people on one side or
the other, the public interest will ordinarily
correspond with the interests of the majority.
But commonly there is no clear-cut majority one
way or the other. There is usually a relatively
neutral or indifferent group which decides the
issue and with respect to the issue represents the
public. The part played by the effective public
group is to evaluate the claim of each directly
interested group and to decide the issue in the
manner that will best serve the interests of the
members of the effective public group or what
they conceive the public interest to be. Since
this group is relatively neutral, it is in position to
decide the issue fairly and with considerable
objectivity. Each directly interested group en-
deavors to persuade the neutral public group.
The decision may be in favor of one of the
directly interested groups or it may be a compro-
mise between their demands. As the result of
the action of the public group an equilibrium is
reached which will last until changing circum-
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stances or changing opinions again raise the same
or a related issue.
This choosing and compromising is the main
function of the politician in the best sense of the
word. It is not a function which can be per-
formed by tax experts or tax engineers. It
represents at bottom a determination of what is
in the public interest. Only the public is in
position authoritatively to state its interest.
The people are often sadly in error as to what are
their interests, but obviously no one person can
be sure he knows what is the public interest.
It will be readily agreed, no doubt, that the
private interest groups are not likely to be very
much interested in tax principles. They are
interested in getting what they want; the princi-
ples they espouse are likely to fit their interests as
they see them. The neutral public group, how-
ever, is open to persuasion on the basis of
principles. The interested groups often seriously
abuse tax principles in urging upon the neutral
public group the view that their interests are in
harmony with principles accepted by the public
group. For example, many crimes of tax propa-
ganda are committed in the name of the principle
of ability to pay.
TOWARD "REASONABLE" TAXATION
Because of conflicts of interest and the part
they play in tax issues we cannot hope for ideal
taxation. Even if there be such a thing as ideal
taxation in contemplation, no one is in position to
demonstrate what an ideal system is, and the
conflicting groups in the community certainly
would not recognize it as such. What we can
hope for is "reasonable taxation."' Reasonable
taxation is taxation which constitutes at any
given time the nearest practicable approach to
the public interest. Reasonable taxes cannot be
made fixed and unchanging; they will not stay
reasonable with the passage of time and changing
conditions. People who lose today in their
attempt to get tax changes which would promote
their interests will reopen the matter another day
when the circumstances seem more favorable.
Perhaps on that occasion their private interests
will be judged to coincide with public interest
and the desired tax change will be made.
I Cf. John R. Commons, Institutional Economics (New
York, 1934): 805-840 (particularly 820-821). The present
writer is deeply indebted to the classroom teaching and
published works of Professor Commons with respect to
the ideas discussed in this paper.
 CONFLICT AND HARMONY IN TAXATION 27
This importance of tax conflicts and the pros-
pect of an ever-changing tax system are very
distressing to many people, which is not sur-
prising. Conflicts are confusing and leave one
without a nice solution. Conflicts tend to take
the form of log-rolling for special privileges and
loopholes, with a consequent erosion of the tax
base and degeneration of the tax system. A long
catalogue of failings in the tax system can be laid
at the door of conflicting interests. The political
process has frequently been distorted to serve
narrow special interests which by no stretch of
the imagination could be considered the public
interest.
One reaction to the problem is to minimize and
ignore conflict. This, by and large, is the ap-
roach of treatises and textbooks on economicss
and public finance. Perhaps it is thought that
conflict is like sin, something to be kept down by
keeping the mind on the higher harmonies.
More seriously, a tax system based on high
principles reflecting common interests and har-
mony is both intellectually and emotionally more
satisfying than one based on conflict. Tax
theory based on harmony can be much more
nearly "scientific." Moreover, it is through
unity that society is strengthened and through
conflict that it is disrupted, sometimes to the
point where totalitarianism seems the only
solution.
But there is no use in glossing over the facts.
Conflict will not go away simply by being ignored;
the only result of ignoring it is that- the evils
growing out of conflict will continue to flourish,
the tax system will continue to be condemned,
and the politicians will continue to be castigated.
The conflict is there anyway, and in many cases
private self-interest is going to decide tax issues.
To recognize the conflict and bring it into the
open would seem the better course. Then one
can see better whether the public interest is really
being achieved from conflicting private interests.
After all, if each person evaluates his own
competing interests intelligently, if each group
really knows its own best interest, if the effective
public group understands the relations between
group interests and the public interest, and if
the political machinery fairly and effectively
represents the different interests, the result
should be the achievement of public interest in all
cases. This is an imposing list of "ifs." They
may come true but only in "never-never land."
They are far from being true in the United States
today. The point is that the future improve-
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ment of tax policy and the tax system rests
largely on making them increasingly true.
Unfortunately, there is no secret formula for
improving the tax system; there is nothing new
on which to pin hope. The old standbys are
about all there are, namely, increased under-
standing, wider dissemination of knowledge, and
the improvement of the political machinery. So
far as the last of these is concerned, the de-
ficiencies of the system of representative govern-
ment in the United States have been pointed out
many times. While there are no doubt special
lines of revision which might be mentioned with
particular respect to taxes, time does not permit
the discussion of these possibilities in this paper.
The considerations underlying tax policy may
be said to look in two directions, the past and
the future. The principle of tax justice looks to
the past and endeavors to levy tax burdens in
accordance with the ability of people to pay such
taxes as measured by past evidence. It is be-
lielVed that makers of tax policy, however, are
usually more concerned about the effects taxes
will have on employment, production, and the
condition of the economy generally than they are
on ability to pay, although the latter is not dis-
regarded. They are, at their best, interested in
levying taxes in such a way as to contribute to
the greatest economic well-being in the future.
The generalizing of this point of view into a prin-
ciple of taxation would mean that taxes would be
kept relatively low at those points where taxes
interfere with production, and made relatively
high at those points where such taxation would
not interfere with production. Putting it an-
other way, taxes would in so far as possible be
made to fall on social surpluses instead of on
social costs. The development of such a prin-
ciple to the point where specific application could
be made to the different tax issues as they arise
for settlement would provide an invaluable tool
for the policy-maker. The development of such
a principle depends in part on a much greater
knowledge of the effects of taxes than exists
today. This is true even though knowledge has
outrun practice in some respects.
There are many sectors of the tax field in which
further study, specific quantitative study as dis-
tinguished from general analysis, is necessary if
the jobs of tax policy and tax engineering are to
be done adequately. There needs to be a further
advancement of knowledge concerning the extent
and limits of conflicts and harmonies of interest.
It is almost certain that the area of harmony is
 28 ROY BLOUGH
much larger than ordinarily appears to be the
case. Continued study should narrow the range
of conflict and reduce its intensity. This is
very important if the more unfortunate effects of
conflict of interest are to be minimized. Further
study is needed also to determine the relationship
of taxes to production, employment, and other
socially desirable economic factors.
Along with this expanded economic research
should go a more widespread public dissemination
of tax information. There seems to be a firm
belief by most people, even very competent
people, that they will never be able to understand
taxes. This is only an inferiority complex, but
their problem is not clarified by the many con-
flicting programs which are pressed upon them,
and the frequent wide divergence of opinion
among economists has not helped the situation.
Fortunately, not everyone has to be fully
informed. We are an organized people and rely
largely on the leaders of our organizations.
These leaders need to absorb as much as possible
of the type of information which will be forth-
coming from economic research in taxation.
Education of this kind will be helpful in dis-
tinguishing long-run interest from short-run
interest and in recognizing private self-interest
which poses as public interest. Such education
is necessary also to lead to the broader harmony
which underlies much of tax conflict and which,
if promoted, may lead to unity rather than
divergence.
It is suggested that the encouragement of re-
search and the education of the leaders of the
community call for the establishment of a journal
of public finance. There is no journal devoted to
the whole field of public finance and that field
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exclusively. Such a journal could make avail-
able to the public in relatively non-technical form
the results of research in taxation economics.
Such a journal could also cut across the boundary
lines between economics, political science, law,
and administration-a necessary procedure since
most tax matters naturally cut across these lines.
Great care would have to be taken to see that
such a publication did not become a forum for
special interest groups to urge policies which they
desired. Indeed, it is believed that in such a
journal policy recommendations should be kept
to a minimum, with the major emphasis on
research.
There may be other better ways of achieving
greater knowledge of the effects of taxation and
greater dissemination of this knowledge. Cer-
tainly some changes are needed in American tax
policy formation. At the risk of repetition it is
to be emphasized that the most disquieting aspect
of taxation is the dominating role of conflicting
interests based too often on shortsightedness and
ignorance. The tax system shows signs of de-
generating into a collection of myriad provisions
conferring special privileges on numerous mi-
nority interests. Conflict is inevitable and
should be accepted as a necessary and desirable
part of the process of arriving at a tax policy
which will be in the public interest, but when
conflicts disrupt the social and economic struc-
ture, society is likely to create artificial uniting
forces and institutions, and these may be very
dangerous to a democratic way of life.
The problem is to find ways to use tax conflicts
to produce a finer tax system, one more attuned
to the ever-developing needs and ever-changing
emphases of the social structure.