And so, the conclusion goes, we shouldn’t complain too much about higher taxes or other inconveniences. After all, we’re doing just fine. It sounds appealing and reasonable. But logically speaking, the argument falls apart on four counts.

1) It simply doesn’t follow

The first logical objection is the non sequitur: the conclusion does not follow from the premise. Suppose that the Dutch do indeed rank among the richest or happiest people in the world. Even then, we still do not know whether an increase in income tax, VAT or tax in box 3 is sensible. Nor does the fact that the Netherlands is prosperous prove that the tax burden is optimal. Perhaps we are prosperous thanks to our tax system, or perhaps in spite of it.

It is more likely that our prosperity is the result of a complex combination of entrepreneurship, international trade, legal certainty, infrastructure, technology and well-functioning institutions. Anyone who draws the direct conclusion from our current prosperity that the tax burden can therefore be raised a little further is skipping over all those intermediate steps. More relevant questions are whether a tax increases social prosperity, what behavioural responses it triggers, and whether the revenue actually outweighs the economic costs.

The same error becomes immediately apparent when we apply this non sequitur reasoning to other situations. ‘The boiler has never had any problems, so we might as well stop the annual servicing from now on.’ Or: ‘There are smokers who live to a very old age, so we might as well have another cigarette.’ We recognise straight away that these are flawed inferences. But when there are calls for a ‘fairer’ distribution of the burden, we seem less sensitive to logic.

2) Being able to pay is not the same as having to pay

By extension, ability to pay is confused with desirability. If someone earns €100,000, that person can probably afford a tax increase of €1,000. But that does not prove that levying that €1,000 is a good idea. To do so, we would at least need to know what the government does with that money, what social returns are achieved as a result, and what economic effects the tax levy has on the other side. After all, taxes can influence people’s behaviour, such as their willingness to work, save, invest and start businesses.

The argument ‘we are rich, so we can pay more tax’ only answers the question of whether it is financially feasible, not whether it is necessary or desirable. I might well be able to pay an extra €200 to my energy supplier every month without getting into financial difficulties. That is still no argument for increasing my energy bill by €200. To do so, it must first be explained why that increase is necessary and what I get in return. The same applies to taxes. Ability to pay may be a relevant consideration when distributing the burden, but it is not, in itself, proof that increasing the burden is economically sensible, effective or fair.

3) It’s worse elsewhere, so the problem doesn’t exist here

Wealth and happiness are relative concepts. The ‘we’ve got it so good anyway’ argument implicitly draws a comparison with people or countries that are worse off. This is known as the fallacy of relative privation: a problem or objection is played down by (implicitly) pointing out that greater problems exist elsewhere. The fact that the healthcare system in country A functions less well does not tell us whether the Dutch healthcare system could be more efficient. And the fact that people in country B are poorer does not tell us whether a Dutch tax is effective or fair.

In fact, virtually any social criticism can be rendered impossible in this way. After all, there is almost always someone off to a worse lot. Anyone who is only allowed to voice criticism when there is no greater problem anywhere in the world will, ultimately, be unable to criticise anything at all. Prosperity should therefore not be used as an argument to stifle criticism. On the contrary, it gives us both the scope and the responsibility to remain critical.

4) But what does ‘having it good’ actually mean?

This leaves us with an even more fundamental issue. Is being happy, or ‘having it good’, synonymous with a high income, a long life expectancy, good health, plenty of social contacts, personal freedom, financial security, or a sense of purpose? Every ranking depends on how the concept is defined and measured. If psychological strain, prolonged stress, burnout symptoms or feelings of meaninglessness are weighted differently or given greater weight, the image of a ‘happy’ country may also change.

We must therefore be cautious when such a ranking is used in a political debate as if it proved something definitive. But even if the Netherlands is demonstrably one of the happiest and most prosperous countries in the world, the crux of my objection remains valid. Even then, that observation says nothing about the desirability of a further tax increase.

A value judgement disguised as a conclusion

It is likely that we do indeed have it good in the Netherlands. But it does not follow from this that every tax increase is sensible, every item of government expenditure is useful, or every complaint is mere whingeing. Behind the reasoning ‘we have it good or we are so happy, so we can certainly pay more tax’ usually lies a concealed normative judgement: people who are well-off ought to contribute more.

That may, of course, be a political or moral conviction. But it is not an economic conclusion that automatically follows from our prosperity. It is a value judgement. The fact that we are well off is an excellent reason to be grateful, but a poor reason for setting a tax rate.

This article contains a personal opinion by Harry Geels

More columns by Harry Geels