In this interminably long election season, the topic of taxes has been frequently raised, and you can bet it will be brought up many times between now and Election Day. Politicians think it's an easy way to endear themselves to voters, and they can't pass up the opportunity. Notice with the exception of Walter Mondale in 1984, they never campaign to raise taxes, only to lower them. After all, we all hate taxes and want them lowered, right?
Well, maybe not. While most taxes are enacted by legislators, a few are subject to referendum. Local option taxes in Iowa are approved by the electorate, almost always when the uses of the tax are clearly defined.
If people hate taxes so much, why do they vote to impose or increase them? The answer is clear: They approve of the uses of the tax revenues.
But this doesn't happen at the national level. Raising or lowering the federal personal income tax is done by Congress and the president, not the voters. Of course, with a population of more than 300 million people, there is no way we could have a national vote on taxes, so we have little recourse. This has some strong disadvantages as well as advantages. Few if any dollars raised by Uncle Sam are earmarked for particular purposes. Instead, the money pretty much goes into the general fund and is then allocated by legislators to various purposes. The result is while we see the immediate cost of government programs in our pay stubs as taxes are withheld every week or month, the benefits are many times delayed or distant. It's hard to connect costs with benefits and decisions are difficult to make. After all, who doesn't occasionally feel as if their tax dollars were going down a rat hole?
Yet, at the same time, we seem to be asking government to provide more, not less, public services. We wanted protection from terrorists and government responded by creating the Department of Homeland Security. In 2008, it will spend more than $42 billion. And recall, this department didn't exist eight years ago.
In 2003, Bush's invasion of Iraq was endorsed by most Americans. We're now over $500 billion spent and climbing almost $350 million per day with no end in sight.
Closer to home, we want a clean environment, less dependence on foreign oil, a safe workplace, quality education systems and a multitude of other programs. Regardless of what we say, it seems every time we have a problem, we ask government to solve it.
Americans want these services but they aren't free. They're paid for with taxes. Economists have long understood there is no such thing as a free lunch, and the electorate should know this too. I know taxes are not popular, but neither is paying for the pizza you get on Friday night.
I'd love to get free pizza, and I'd love to get public services without paying for them. Unfortunately, it doesn't work that way. If I want something, I have to pay for it.
So what about the services government provides I don't want? Presumably, someone wants it or it wouldn't be provided. Who's to say that person's tax dollars can't be spent on their project? I think we should have a space program but there are those who disagree. Others may think it's important to build recreational facilities for water lovers. I wouldn't use them - I can't even swim! So who's right? Well, both and neither.
That's why government policy is frequently a compromise among competing wants. You approve money for space research and I'll approve it for water. Seems reasonable to me.
If we want public services - and it is obvious that whatever our rhetoric, we want a lot of them - we have to pay for them. The professors, pundits and politicians who pander to us by promising to cut taxes without paring programs know this. Yet, they continue to play their scratched record trying to convince us taxes are somehow bad. They should discard the emotional agitation and present reasonable and cogent arguments for tax cuts and program elimination. Instead of appealing to our worst attributes, why can't they be honest, inspire us and enlighten us? I would guess it would lead to more thoughtful - and civil - discourse.
And perhaps, better government.
Posted in Guest_column on Sunday, May 4, 2008 12:00 am
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