Ragged Clown

It's just a shadow you're seeing that he's chasing…


Party on, dudes!

Bruce Bartlett (advisor on tax issues to Reagan) on liberals.

Back when I used to listen to Rush Limbaugh there was one thing in particular he used to say that I agreed with. Over and over he said that liberals defined themselves largely by the worthiness of their objectives and the sincerity of their motives. The actual results of their policies didn’t matter at all. Thus liberals support the minimum wage because they care about the well being of workers at the bottom of the wage scale. That many of these workers lose their jobs or fail to find jobs because the minimum wage priced them out of the labor market was a matter of no concern to liberals. All that mattered is that they cared.

Bruce Bartlett (Treasury official under Bush I) on conservatives.

One of the reasons I became a conservative way back when is because conservatives lived in a world where one’s actions are defined by their consequences, not one’s motives. Conservatives also prided themselves on being reality-based and fact-based in their analyses, while liberals often seemed to live in a dream world disconnected from history, institutions and ideology, among other things.

Bruce Bartlett (drafter of the bill which became Reagan’s signature tax cutting bill) on the Tea Partiers.

Today, however, conservatives have largely adopted the liberal operating assumption and now also define themselves by the righteousness of their motives. This fact became very obvious to me this week when I examined the knowledge that tea party demonstrators on Capitol Hill had on the subject of taxation. As I recount in my column below, most of those in the crowd grossly overestimated the level and burden of federal taxes, thinking that they are many times higher than they actually are.

Bruce Bartlett (one of the founders of ) supply-side economics on the Tea-Partiers answers to a survey prepared by David Frum (economic speechwriter for Bush II).

Tuesday’s tea party crowd, however, thought that federal taxes were almost three times higher than they actually are. The average response was 42% of GDP and the median was 40%. The highest figure recorded in all of American history was half those figures: 20.9% at the peak of World War II in 1944.

Bruce Bartlett on taxes under Obama.

According to the JCT, last year’s $787 billion stimulus bill, enacted with no Republican support, reduced federal taxes by almost $100 billion in 2009 and another $222 billion this year. The Tax Policy Center, a private research group, estimates that close to 90% of all taxpayers got a tax cut last year and almost 100% of those in the $50,000 income range. [snip] No taxpayer anywhere in the country had his or her taxes increased as a consequence of Obama’s policies.

Bruce Bartlett on the gap between perception and reality.

Perhaps these people haven’t calculated their tax returns for 2009 yet and simply don’t know what they owe. Or perhaps they just assume that because a Democrat is president that taxes must have gone up, because that’s what Republicans say that Democrats always do. In fact, there hasn’t been a federal tax increase of any significance in this country since 1993.

Bruce Bartlett’s recommendation to Tea-Partiers.

Whatever the future of the tea party movement in American politics, it’s a bad idea for so many participants to operate on the basis of false notions about the burden of federal taxation. It only takes a little bit of time to look at one’s tax return to see what one is actually paying the Treasury, calculate the percentage of one’s income that goes to taxes, and compare it to what was paid last year and the year before. People may then discover that their anger is misplaced and channel it into areas where it is more likely to bring about positive change.


5 responses to Party on, dudes!

Acilius April 2, 2010

Very interesting. My one reservation is that Bartlett seem to have a pretty narrow definition of “taxes.” All that spending has to be paid for sooner or later, whether by (#1) raising the rate at which the Internal Revenue Service collects its receipts, (#2) by inflating the currency so much that the debt vanishes, or (#3) by creating “tax shelters” that direct wealth away from its owners and into the coffers of nominally private-sector actors who are doing the state’s work for it. It seems a bit arbitrary to point out that Mr O has not (yet) done any taxing in form #1, when he has approved spending levels that will likely require a great deal of all three of those forms of taxation.

Jeffrey Fredrick April 2, 2010

“(#3) by creating “tax shelters” that direct wealth away from its owners and into the coffers of nominally private-sector actors who are doing the state’s work for it.”

Are you calling charitable donations taxes?

If not, can you clarify what you mean by this?


Acilius April 2, 2010

Take health insurance, for example. A company can pay corporate income tax to the IRS, or it can pay premiums to health insurers and deduct them as a payroll expense. Companies do compete for a reputation as providers of generous benefit packages, they don’t compete to see who can write the biggest check to the IRS. So of course they choose to pay their corporate income tax to a nominally private-sector insurance company rather than to an openly public sector agency. Whether health insurance ought to be the state’s business is another question (one I’d likely answer in the affirmative.) The point here is that the USA’s tax structure treats it as the state’s business.

Jeffrey Fredrick April 4, 2010

Ah, I see the theory now, and grant the elegance. But I’m having trouble seeing tax breaks as uniformly the result of a coherent theory of government and what is or isn’t the state’s business.

Take health insurance for example.

Given the history of health insurance in the US I would expect the deduction of health insurance premiums was the result of pressure from two powerful political forces: large corporations (like auto companies) that provided such benefits and unions whose members received the benefits.

Acilius April 5, 2010

I would be the last person to accuse the USA of setting national policy in any area as the result of a coherent theory of government! And among the last to wish that it were so. Given the sorts of people who end up in the seats of power, the only theories that would be at all likely to shape policy-making would be even uglier in their consequences than the scramble for other people’s money that dominates Washington these days.

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