Taxation is the State’s apparatus of financial power – it imposes guilt and bad conscience into people and offers distinction between those who deserve respect and those who don’t.

Lazzarato regards neoliberal governmentality as the complex combination of technologies that govern the debt society and state in the post-Fordist era. He stresses that the financial crash of 2007-2008 disclosed that we do not live in an ideal form of security society as suggested by classical liberal governmentality but in a society built upon the complex assemblage of the sovereign, disciplinary and security modalities of power. Accordingly, sovereign/the state and disciplinary power apparatuses have brought to the front certain repressive techniques, policies, political rationalities, and mechanisms of norm imposition. Lazzarato argues that we need to consider the fact that neoliberal governmentality assumes both centralizing and decentralizing strategies and creates sweeping social effects. For him, the 2008 global financial crisis has proved that we are living in an “authoritarian governmentality” (Lazzarato, 2015: 169) which relies on a specific articulation of three modalities of power. Lazzarato argues that the sovereign and disciplinary techniques of governmentality have gained ascendancy in exerting power (2015: 211). What is most significant in Lazzarato’s argument is that he identifies the role of taxation in constituting and controlling the contemporary debt and rent society in line with the authoritarian neoliberal governmentality. Taxes, in his own words, intercede as the weapon of political governmentality. Taxes assure the continuity and reproduction of profit and rent that crises interrupt; they exert economic-disciplinary control over the population. They are the measure of how effective austerity policies are on the indebted man (Lazzarato, 2015: 8).

Lazzarato pays special attention to taxation as one of the three apparatuses of capture alongside profit and rent. He is of the opinion that, “[t]he transition from Fordism to neoliberalism presupposes no less, and perhaps more, important changes in how money and taxation function” (2015: 31). He argues that, after the crisis, taxation, outweighing rents and profit, has now occupied the first order in the hierarchy of the means of capture. Taxation has become the essential power instrument that monetizes economy (2015: 33) as part of the quantitative easing policy put into effect as a remedy to heal the damaged financial industry as a result of the 2008 crisis. When individual debts and rents have reached their limits and as such finance capital turned its face to the state finance for profitable gains, taxes have become vital apparatus to maintain financial gains and flows. Taxes now function no more than as a “political levy” (2015: 36) that secures the current and future conditions of financial profit.

Therefore, taxes have increasingly become cut off from financing public expenditures for social welfare, expanding industrial employment of capital, and social redistribution of wealth. Taxation has become an apparatus of financial power. In this respect, to paraphrase David Harvey (2005), tax proves to be the means of ‘the restoration of class power’ in favor of financial capital. In addition to being the means of economic and class power, taxation functions as political power and rationality as well as governmental technology that enables “economic disciplinary control over the population” (Lazzarato, 2015: 8). For Lazzarato, in the age neoliberal governmentality and financialization, taxes have three main functions: Restoring the financial gains and debt economy by ensuring the financial flows; disciplinary control of society; construction of the neoliberal subjectivities. Concerning the state finance effects on neoliberal subjectivation in which taxes assume an essential role in relation to debt, Lazzarato provides a concise overview: Taxes play a central role even from a subjective point of view because their basis lies in the expiation of the “fault” of indebtedness. When “public debt” is not honored, the fault is not rectified individually but collectively ―through taxes. Taxation acts as a powerful vector for the transformation of each of us into the indebted man. Debt represents a mnemotechnics integral to the construction of a (bad) conscience and guilt. These are the subjective conditions necessary for keeping the “collective” promise of reimbursement, a promise state debts implicitly make (Lazzarato, 2015: 41-42).

Therefore, as Lazzarato argues elsewhere, “financial policies. . . is one of the most effective tools of the government of conduct” (2009: 122). “Finance” in this context can be understood both as fiscal/public and private finance. In this sense, taxation plays a significant role in imposing a “sense of guilt, bad conscience, and responsibility” on individuals (2015: 42). This means that taxation functions as a self-technology. Debt drives up this new political rationality and technology of taxation. Debt constitutes a new technique of power. The power to control and constrain debtors does not come from outside, as in disciplinary societies, but from debtors themselves . . . Credit produces a specific form of subjectivation. Debtors are alone, individually responsible to the banking system . . . Debtors interiorize power relation instead of externalizing and combating them. They feel ashamed and guilty. Debt is the technique most adequate to the production of neoliberalism’s homo economicus (Lazzarato, 2015: 69-70).

It should be noted that neoliberal homo economicus is quite different from its counterpart in classical liberalism and classical political economy. As Foucault shows in The Birth of Biopolitics (2008), homo economicus in the eighteenth century liberal governmentality was a technology of limiting the state intervention, who lived, or should have lived, outside the realm of direct government intervention and informed the natural limits of government, and to whom the state should have shown respect. In contrast, neoliberal governmentality suggests that the conditions of the market economy and competitive homo economicus should be constructed by the state sovereignty and disciplinary mechanisms, which is discernable from the German ordo-liberalism. As such, in neoliberal governmentality, homo economicus like the market itself is not natural, instead, becomes the target for construction by the state intervention in which fiscal regulations take the strategic position. Self-technologies of the ‘conduct of conduct’ are not outside the scope of the sovereign state; quite the reverse, the state policies like public finance have deep effects over the technologies of the self to create the “sovereign individual” (Foucault, 1978: 89) subject to the combined effects of the power regimes of security, disciplinary and legal apparatuses of the market. If the debt as the technology of the social and the self is the most vital mechanism in controlling the society, it functions as such with the neoliberal way of taxation as Lazzarato (2014: 1042) argues.