#60. Tax evasion, tax aversion, and the starve the government movement
It astonishes people who live in the European social democracies and here in Canada that in America a major party, the Republicans, and its smaller unofficial ally, the Tea Party, not only claim that taxes are too high but that there should never be –no matter what—any increases in taxes, for anybody. The Tea Party members invoke with their name the Boston Tea Party and the precipitating slogan of the American War of Independence: “No taxation without representation.” But they are not really concerned with representation, they are focused on taxation itself, which they reject. They want to “starve the beast” of government, so voracious for revenue, and thereby shrink it into the “small government” –the smaller the better—they tote as an ideal. That tiny remaining government should, they think, be controlled by them as the grateful people’s triumphant representatives: the people will have representation without taxation.
As of today, Monday the 1t of August, this Tea Party platform has won the day in the insane debt ceiling debate that has gripped Washington for weeks. Supposedly, we are saved from the August 2nd catastrophe scenario. But, instead the Tea Party’s main propagandistic catastrophe scenario has been installed in Washington. There is, so this scenario goes, a civil war in the country in which the Tea Party , allied with like-minded virtuous anti-tax small government Republicans, is facing down President Obama and the big government, “tax and spend” Democrats. Had the Democrats gotten their way, so this image implies, the beast of government would have become ever more of a Leviathan. We would be continuing our slide into socialist totalitarianism. We would have become ever more trapped by the debt such a regime has run up with its overbearing tax policy –keeping taxes high and then over-spending the revenue anyway. But, praise be, the Tea Party held firm and beat back the force of evil.
One thing is obvious in this ridiculous situation and that is that “taxes” has become a shibboleth. If you say the word “taxes” with sufficient contempt in your voice, you are identifiable as a small government advocate; if you say the word neutrally or fail to express fear of taxes, you are a socialist. Things have changed little since the 13th century BCE when, as the Book of Judges (chapter 12: 5-6) informs us, the Gileadites asked their neighbors the Ephraimites, whom they had conquered and banished to the far side of the River Jordan, to pronounce the word “Shibboleth” when they applied to cross back over the river and return to their homes. If the refugees had lied on their applications, denying they were Ephramites, their inability to pronounce the Hebrew word for an ear of corn in the proper Gileadite fashion would expose them, whereupon the Gileadites would kill them. Forty two thousand Ephramites were slaughtered at the Jordan River’s ford, the verse in Judges informs us matter-of-factly.
So, here we are in a Washington moment in which everyone who is not a Tea Party or Republican anti-tax zealot is afraid to say the word “taxes” at all lest they and their re-election chance be dead on the Potomac’s ford. Even saying “we must end tax breaks for the rich” has become dangerous, much less “we must tax the rich.” And yet, at the same time, out in the country at large, “beyond the beltway,” a recent Washington Post-ABC News Poll (www.washingtonpost.com/wp-srv/politics/poll) has found that for 72% of Americans the most popular reforms to deal with the deficit are increased taxes on those making more than $250,000; nearly as many want increased taxes for hedge fund operators and oil and gas companies. Almost 75% of Americans oppose cuts in Medicare. Majorities reject raising the eligibility age for Medicare or cutting the Social Security inflation rate, two reforms President Obama seems to have accepted in principle in order to get his deal with the Republicans and Tea Partyers.
So, how did this debt deal, which makes no economic sense and which is profoundly undemocratic come to pass? What are these anti-tax Tea Partyers thinking? It seems to me that they are not thinking. The word “taxes” has become a test word for them, and has no connection to any ordinary citizen’s daily experience. It functions like a piece of hate speech, a prejudicial word for a group, the tax advocates, the socialists.
I think that the poll indicates that the majority of Americans want to live in a country in which they can have a daily experience that is not now possible. They want to have the experience of hearing people say with satisfaction when they look at a public school: “our taxes built that so that our children can be educated and enabled to live in the world.” They want to say as they look at the hospitals and clinics that serve their community “our taxes built these places so that we and our children have medical practitioners nearby, practicing preventative and therapeutic medicine, ready to help us even if we are temporarily fallen on hard times.” They would like to join other working people each workday morning in saying: “our taxes paid for this road, this railway, this bus, this train, these engineers and those drivers, and I am able to get to work as cheaply, efficiently, and eco-sustainably as possible thanks to that.” They do not want to feel delusional if they say “Ah, I have clean water coming out of my kitchen faucet because of the water authority and the water system my taxes are paying for.” Teaching their children how things work, they think it would be good to say: “Well, about half of our income goes to taxes so that needs we have which no individual can meet alone or through a family are met by government projects, while the other half of our income is for us to spend as we chose or to save for the future. People who have more or earn more pay more in taxes than people who have less. This way we do not need a Robin Hood to make sure no one is without food, shelter, medical care.”
But these kinds of statements are not part of our daily experience. We do not live in Norway, a country where the people, if they get shocked by an explosion of insanity from a person who rejects their commitment to creating a well-functioning, shared national household, pull up and recommit to that vision. No, in our midst we have, instead, an on-going opposition to the very idea that tax-paying can provide the resources to make a well-functioning, shared national household. And that opposition routinely explodes into anti-tax frenzy. The simple idea that taxes are necessary to run the national household is obliterated.
I certainly know that governments can mis-spend the tax revenue they get, and that governments can fill up with corruption, spending tax money illegally or using it to subsidize crony projects at the expense of ones that serve the people. Taxes are not moral currency, they are money, and where there is money there is corruption. Political oversight is always needed –and if the political oversight is itself corrupt, a country is in serious trouble. That is a very short way to summarize the recession of 2008 and how wasteful and wrong-headed was the use of tax revenue to bail out a bunch of tax evaders.
What the citizens who want taxes to be paid and paid equitably –more by the rich, less by the poor—and honestly supervised are much more likely to hear around them than appreciation of taxes is: “Why should I pay taxes? I am going to hire an accountant who will shelter my money or reduce my tax bill to zero. I think my money should be my money, I earned it, I worked damn hard for it.” That is the anti-tax harangue of the entitled individualist, the narcissist. But there is also the anti-tax snarl of the paranoid: “My money is my money, I do not want to give any of it to a government that gives it to undeserving people or to programs I despise because they are undermining the country’s strength.” Or there are the unrealistic fantasy-mongers: “Look, if people who make good money did not have to pay any taxes they would be able to hire more people. They would immediately expand their businesses, and serve their country by being successful.” Let our unemployment problem be solved by Good People who do not pay taxes! Tax evasion is not for personal gain, all these sorts of folks ratonalize, it is to support individualism, to oppose any scheme for redistribution of wealth, to contribute to a growth economy ultimately benefiting everyone.
In such a sea of hypocrisy it is very difficult to remember that paying taxes can be a means of acting communally, in concert; you put your money in a common pool that sustains the common habitat in which everyone lives, the national household. If that national household is well run, if there is good governance, we are free to do other things than sweat over the national checkbook and the national bank balance. But in America now, the feeling that taxes are the government’s means of robbing the people is growing more common –and it is this feeling that the Tea Party taps into and then reinforces, guides. Why? Because for it to be otherwise people have to talk about good governance, not only about big government or small government. To tax or not to tax. Our choice, the Tea Partyers argue, is that simple.
To me it seems that this is the kind of choice is conjured up by people who have been profoundly neglected or feel themselves to have been profoundly deprived. They are fighting back in the way that a juvenile delinquent does by stealing to make up for past deprivations –of money, but more deeply of love. Listening to the “no more taxes!” advocates, there comes before my mind a conversation I once had with a client who makes a tiny salary doing admirable work with children. She is single, childless herself, and now past child-bearing age. Bitterly, on April 15th, she said: “I think it is really unfair that I have to pay school taxes when I don’t have children and am never going to have children –the people who have children should be responsible for them by paying the school tax.” I asked her if she wanted to live in a society in which children –all children–got a good education at a preschool as good as the one where she works. “Of course,” she said. But she did not make the connection: so everybody has to do their part, as the result is for everybody, including her. That connection does not make her feel any better about herself or diminish her sense that she has been left out, deprived, never included.
My client spent her unhappy, neglected childhood in the years when the Republican Party was morphing into what it is today from what it was up to the 1960s. It was states’ rights in it orientation, skeptical about all things federal and big government, often (although not consistently) isolationist, and fiscally conservative. But, on the other hand, its members had accepted the fact that the American military had needed a huge build-up to fight in the Second World War –and that meant a huge increase in the size and reach of the federal government. During the Cold War, that build-up was thought necessary and the Pentagon continued to grow. Lo and behold, the economy benefited –despite the occasional little recession. Nonetheless, the Republican Party was, still, a party that could be led by an Eisenhower, a staunch anti-communist who could, nonetheless, warn about the domestic “military-industrial complex” and its dangers.
The old Republicans could understand that the war-time build-up, the post-war economic boom, and the post-war increase in the size and reach of the federal government had pulled America out of the Depression. And they understood, too, that the so-called entitlement programs –like the Social Security and medical insurance support for senior citizens that came with the 1935 Social Security Act—were necessary to prevent the growing impoverishment of the elderly. But addressing the growing impoverishment of the lower classes and their children –including so many southern African-American migrants to northern cities– was not, basically, something they wanted the federal government to be involved with. To the extent that poverty was to be addressed at all, it was to be addressed by the states, using state taxes and as little federal revenue as possible.
I disagree with this position completely, but it is at least a position, not a piece of insane propagandizing of the sort many current Republicans and the Tea Partyers engage in. Thinking about it today, my grandfather came to my mind. He, who had been a Republican state senator in Maryland, argued his version of the old Republican world-view over our dinner table, with vehemence, but also with–after his fashion—reason.
My memory went to an evening in1962, when I was a teenager enormously inspired by John Kennedy’s election and reading all the time about politics, economics, international affairs. Our dinner table topic was Michael Harrington’s classic study The Other America: Poverty in the United States (1962), about which I made a little book report type speech to my elders. At the time, my grandfather, known to his friends as Colonel Williams (he had been a decorated cavalry officer the First World War), was preoccupied politically with the threat of Communism in southeast Asia. He had tried to use his influence to press President Kennedy (who, needless to say, he had not voted for) to send American officers to South Vietnam so that they could support the Vietnamese who were fighting against Ho Chi Minh and against China. The Chinese Communists, so he thought, were creeping down into Southeast Asia on their way to world conquest. Harrington –“that Commie bleeding heart” in the Colonel’s judgment– had written about what seemed to him just a soluble practical problem, which state governments and local communities should take on. Personally, my grandfather put his local energies into getting funds from Baltimore for a housing project on the upper Chesapeake Bay that was to be–to the horror of his Republican cronies—integrated. His motivation horrified me when he made it crystal clear, instructing us over the dinner table: ”If you let the Negroes just live on the streets, they’ll steal and tear down our communities; if you let them live together in a ghetto, they’ll organize and make a revolution –just like the Communists everywhere else do. The best thing is to keep them like ours.”
By that “like ours,” he meant like his cook and caretaker, a couple who lived in an annex of the Williams family home which had once been occupied by their slave forebearers. The Colonel was for a transformation of the plantation slave system into a housing project servant system so there would be no poor and all would be free citizens (and educated, as his housing project had its own school, so that the Negroes would not be forever child-like). For this solution to work, he knew there had to be taxes to support it –as there had to be taxes to support our national military, which would keep us safe from our external enemies. On this point, he agreed with Kennedy and later with Lyndon Johnson whom he otherwise hated for his federal War on Poverty. In the Colonel’s opinion, taxes were comparable to the tithe people should pay their churches to support the church and pay for good works amongst the poor.
Ah, those were the completely contradictory and patronizing southern Republicans of yore. They were not insane, they were simply provincial men of their time who viewed themselves as pragmatists and could not in any way reflect on their prejudices–either their racial prejudices or their prejudice against socialists, whom they thought were either National Socialists or Communists, the kind of people our country had gone to war against not so long before. These men were householders, who viewed the nation as the big household in which they knew best as the paterfamilias class.
I fought with the Colonel over almost every facet of his worldview, but I recognized that he was a thoughtful man, a respect-worthy enemy. Trying to figure out why he thought what he thought was a good education. Some of his attitudes surprised me and were, thus, particularly instructive. For example, he had no respect for people who were, as he put it, “filthy rich.” For a nation to have a sizeable group of people who were “filthy rich,” he said, was dangerous. Why? His answer startled me: “You learn in the Army that any officer who thinks he is different than his men because at home he has a lot of money, and behind the lines he has an aide de camp who shines his boots, will get his men and himself killed. Money aristocrats do not make good decisions, they are preoccupied with their money.” How, I wondered, could he understand this but not understand that people have all kinds of preoccupations that make it impossible for them to think of the common good, or to think politically in the true meaning of that word. He had a democratic sensibility but he had trouble holding to it because of his own preoccupations, which were all about federal institutions being robbers and the vengeance he assumed the wretched of the earth would exact from the law-abiding and good is they were not managed.
The common denominator of the kinds of preoccupations that keep people from being able to think politically, I have come to think, is a sense of having been injured and slighted and deprived and threatened; a sense of having been left out in the emotional cold. So the common denominator solution is to become as invulnerable as possible –let no one tax you! —and then make yourself a member of the new ruling class, the new dictatorship. My grandfather had inclinations toward this solution, but he never went there –his suspicion of hate politics always checked him. His democratic sensibility always reasserted itself in a crisis. When Kennedy was assassinated in 1963, I was so touched that he said to me, full of grief: “There is something wrong in the way people hated Kennedy and what he stood for, something that made that madman think he would be praised for shooting him. Something wrong in the Republican Party. I feel ashamed that Kennedy is dead.”
Your grandfather was an admirable man, remaining emotionally available enough to himself and others to keep from wanting to kill what he opposed. But that doesn’t appear to be the case with the wing of the Republican party whose absolutism has been holding the country hostage. It is not easy to make sense of the debacle that has just occurred in Washington, D.C. but it seems to me that Obama thought he could trust Boehner to bring his party around to a mix of tax changes (probably all removals of favors and loopholes, with no overt increases, even for the super-rich) that would avert a default). Boehner may or may not have been acting in good faith, but even if he was prepared for this compromise, he could not deliver it, because all of us are contending with a group of ideological true believers who do not believe in politics. The sense of injury and deprivation may be at the core of their inability to think politically, let alone empathically, but there must be something further involved. I am reminded of Ulysses’ “degree” speech in Shakespeare’s “Troilus and Cressida,” where the collapse of hierarchy (“degree”) becomes a self-consuming process which, wolf-like, “at last eats up itself.” This is what Hitler did in his self-consuming assumption of absolute power, and what the fanatical wing of the Republican party is prepared to do to preserve its sense of invulnerable correctness. No sooner did Obama capitulate to the no-tax fanatics but today he began to repeat the same position he had been forced to abandon, the need for a mix of revenues and budget cuts. Why should we think he will not capitulate next time? Because he will be the only choice against a worse, or faster, catastrophe? The legacy of the Bush-Cheney-Rove years is a Republican party that will continue to feed on its sense of grievance, and on our common democratic welfare, until it is defeated.
I think Bush damages will last for decades. But on a brighter note the Baseball team the Texas Rangers only took 20 years to recover from the damage that George Bush did when he was the owner. One needs to remember that the first law Bush passed in his second term was the Bankruptcy reform act.