My position is unique. I like figuring out my taxes. I like paying taxes. As a child I used to enjoy working mazes; so the income tax forms strike me as simply an adult version of the same game. You are given a starting point on form 1040 and soon you are diverted into all kinds of side ventures. For me that takes me to schedule SE where I calculate my Social Security tax. There are delightful brief visits back to form 1040 along the way.All these calculations bring me full steam into schedules A & B where all kinds of neat things (including church contributions) get to be deducted. After this I can almost see the finish line as I figure the peculiar intricacies of how political contributions, child care expenses, and unemployment compensation are figured. Then comes the suspenseful moment, when income tax paid is calculated against income tax due. But the maze is mastered: I feel every bit as much a victor as if had just completed the Boston Marathon.
I like taxes. To be sure there are some taxes I do not like at all and there are some wrinkles in the tax laws I deem very unfair and there is much that my tax dollar goes for which I do not approve. But still I like taxes. Most of my income goes for the momentary assuagements of my needs. Even most of my tangible purchases have limited life, as a rust spot on a car or a broken binding on a book remind me. Even the house where I dwell is subject to various possible casualties which could gut it in a few moment.
Some of my giving, as to our church, goes for causes which I believe to have ongoing, permanent value to human life. But next to that priority, my tax dollar probably purchases more of continuing meaning than a great bulk of my spending.
My taxes buy parks, museums, and schools. My taxes provide for the poor (in poor measure), pay for elections, and make for fire and police protection. My taxes give medical care, protect me from unfit foods and drugs, and combat the pollutions which threaten my life. My taxes support a free government, care for the mentally ill, and allow our democracy to work.
I wish my taxes did more of these things and less of some others, but my taxes purchase, in part, what I deem valuable and abiding in human life. When I read the constant bleatings about taxes, I fear for our country, for in the name of tax cutting, we could well destroy what is most important among us - that is our caring for one another.
The late Charles Schulz provides a "Peanuts" cartoon that is especially appropriate on this April Fool's Day, just two weeks from the Ides of April - Income Tax Day. Snoopy writes on his typewriter atop his doghouse: "Dear IRS: I am writing to you to cancel my subscription. Please remove my name from your mailing list."[1]
Would that it could be so. Would that we could with the stroke of a computer key expunge our names from the annals of the Internal Revenue Service - that most hated of governmental institutions. Dream on. Dream on.
Dislike, if not outright hatred, of the tax collector is not new. Jesus had to protect Zaccheus, the tax collector, who risked life and limb to meet the prophet from Nazareth. In Luke we read, "The Pharisee stood and prayed thus with himself, 'God, I thank thee that I am not like other men, extortioners, unjust, adulterers, or even like this tax collector.'"[2]
The American Revolution was in part built upon resistance to the tea tax: "Taxation without representation is tyranny." But Alexander Hamilton, first Treasury Secretary, who levied a tax on distilled spirits and carriages, had a more pro-active view of taxation which he regarded as a "means for shaping the national economy, . . . regulating morals, and realizing . . . social reforms."[3] As our own Ralph Waldo Emerson wrote, "Of all debts, men are least willing to pay the taxes. What a satire is this on government."[4]
The income tax made its debut during Civil War as Republican President Abraham Lincoln signed an income tax levying a 3% tax on income between $600 and $10,000 and 5% on income over $10,000. After the income tax was struck down by Supreme Court in 1895, it was another Republican President and a Unitarian, William Howard Taft, who pushed for the 16th amendment which created a federal income tax in 1913.
Even now anti-tax activists are calculating how long the average American works to pay their taxes. President Bush, learning the hard lessons of his father's ill-fated "Read my lips; no more taxes" promise, has presented a dramatic tax-cut package; not to be outdone Congressional Republicans add to its total, while suddenly anti-tax Democrats try to craft a smaller package that will sell.
The debate is fascinating. One argument for the president's tax cut is that if taxes are not cut the projected surplus will just be spent - squandered by the Congress - but the Congress is controlled by members of his own party - "tax and spend Republicans." Go figure!
Then the president tells us we need tax-cuts to jump-start a flagging economy even though his original tax cut will kick in only gradually. Some even believe that Mr. Bush's oft-proclaimed worry about the economy and Vice-President Cheney's earlier talk of recession is dangerously close to a self-fulfilling prophecy - if you bad-mouth the economy enough, people will act as though it is bad until it is. Irrational exuberance has been replaced by irrational pessimism.
But Federal Reserve Board Chairman Alan Greenspan, who up until now has said tax cuts are not a good way to stimulate the economy, has changed his tune. It turns out they are. He worries that the huge looming surplus is not good. However, Treasury Secretary Paul O'Neill uses an unprintable word to describe the accuracy of such projections - then agrees with both his boss and Greenspan. So what is it? Is a tax cut good because the economy is bad or is a tax cut good because it is too good? Can you have it both ways?
Then, bristling from charges that his tax cut proposal favors the rich who will receive the great bulk of the benefits, Mr. Bush says these critics are engaging in class warfare. He does not deny their claims, but simply rebuts them rhetorically. The truth is that the United States is already in a state of class warfare in which the top 20% earn 50% of the income and possess 84% of the wealth, having gained 115% in income over the past 25 years, while the bottom 20% have lost 9%.
Then, there is the "death tax", a clever bit of rhetoric that suggests, I suppose, that we are taxed to death. Known objectively as the estate tax, there is a push to eliminate it altogether. That's interesting, especially in light of the fact that while compassionate conservatives want to rely more on the private - mostly religious - sector for social welfare, those are the very groups that will be hurt. Non-profit groups benefit from the estate tax because people would rather give it to charity than to the government. Even John DiIullio, Director of the Office of Faith-Based Initiatives, is opposed to eliminating the inheritance tax for that very reason.
Washington Post columnist David Broder last summer wrote: "Representative Pete Stark, a California Democrat who built a successful banking business before he came to Congress, addressed his five children and 10 grandchildren in personal terms in explaining, during House debate, why he was not going to vote to give them a 'seven-figure business' entirely tax-free. Under existing law, he said, 'you are going to get a down payment from your mother and me of $1.35 million (tax-free). You have not worked a day in your life for that. . . If you are so dumb that you cannot run that business with over a 50% down payment given to you and 10 years to pay off the balance at a low rate, you do not deserve it.'"[5]
The Stark progeny, through no effort of their own, will have a head start on millions of children who will begin the economic race with virtually no resources. Even with the inheritance tax, they will reap a reward which has not been earned - flying in the face of the work ethic that one is entitled only to what one has earned. Whatever happened to the ideal of a level playing field?
Columnist Molly Ivins caustically observes, "The people who brought us welfare reform on the grounds that getting $8,000 a year to raise three kids is very bad for a mother's moral fiber now tell us that Junior, who never worked a day in his life, needs to inherit $200 million tax-free." [6]
Or if you prefer a more conservative voice, Winston Churchill once said, "Saving is a very fine thing. Especially when your parents have done it for you."[7]
I confess I'm against all the tax-cut plans now before the Congress. Most of us don't really need a tax cut. We are the most lightly taxed people in the developed world - about 30% of our income goes into taxes, while it is on average 40% in most other nations. I, for one, would not change the upper tax rates. The affluent are doing very well, thank you. I find it first amusing, then quite disturbing, to note the enthusiasm for tax cuts among the already wealthy.
For example, the crowd at January's Inauguration broke into their loudest applause when President Bush promised to reduce taxes. That symbolizes a very real moral and spiritual concern. In 1986 the Roman Catholic Bishops in their declaration on U.S. economic justice wrote, "Greed is the most evident form of moral underdevelopment." I find it incredible that in a nation with 32.3 million poor people, including nearly one in five children, there are those who believe that $100,000 or more is not enough.
And, if you study the Bush budget closely, you will note some interesting things. While federal spending as a percentage of Gross Domestic Product was about 22% under presidents Reagan and the first George Bush, it fell to 18 % under President Clinton. The second George Bush proposes to reduce that to 15.7%. If the president held that 18% steady, the federal government would have $250 billion more to spend a decade from now, enough to provide health insurance for America's 43 million uninsured several times over.
A more detailed look reveals that along with a welcome increase in the education budget, he proposes to cut child care grants - so essential to welfare reform - from $2 billion to $1.8 billion; child abuse programs would be reduced by $15.7 million; $20 million is to be cut from an "early learning fund" to improve the quality of child care and education for children younger than 5. Large cuts are also indicated for a new program to train pediatricians and other doctors at children's hospitals across the country.[8] But that is only symptomatic of why I oppose the income tax cuts proposed by our political leaders of compassionate conservatism and limpid liberalism. The Institute of Medicine, the arm of the National Academies, reported that our nation's health system was not capable of providing high-quality medical care to all Americans and must be "reinvented" fast.[9] The World Health Organization ranks us 24th in life expectancy at birth and only 15th in a broad measure of health criteria.[10] Surely the tragic closing of Genesee Hospital is a shot across our bow. Health care in our community and in others across the nation is in jeopardy.
And can we really afford to cut federal programs for the poor when we read about our local situation:[11] There was a 17.5% increase in consumption of food provided by Foodlink last year over 1999, apparently due to rising costs of medicine and heat. And we want to cut taxes which will undermine programs to help the poor? What are we thinking of? As long as well over 10% of our people are "have-nots" - in poverty and near-poverty - I cannot support a tax cut mostly benefiting society's "haves." It just doesn't make sense.
As long as we cannot provide funding for universal Headstart programs, I cannot support a tax cut for those who think they are so overburdened.
As long as we have crumbling schools in our cities, including Rochester, as long as we have these "savage inequalities" in funding for public education, I cannot support a tax cut to indulge those who already have too much.
As long as we have 43 million Americans with no health care insurance, I cannot support a tax cut, when our prosperity provides a window of opportunity to provide health care for all Americans.
As long as we cannot pass a minimum wage that will sustain a family at a humane and decent level, I cannot support a tax cut of which 40% goes to the richest 1% of taxpayers. Are there no limits? How much is enough?
You see, I'm with Supreme Court Justice (and Unitarian) Oliver Wendell Holmes who said "I like to pay taxes. They are the price we pay for civilized society."[12]
I am sick and tired of the anti-government rhetoric we hear from both parties. Remember the Great Communicator, President Ronald Reagan, who got such mileage out of his stern warning that "Government is not the solution; government is the problem." What utter nonsense!
I rode to church this morning on a road built by the government, patrolled by police who protect me from "road rage." They are government. My house is protected by firefighters who are government. Laws that protect me are government. I am warned about dangerous foods and products by government. It is government that guarantees contracts made by business. It is government that guarantees my right to private property. It is government that enables me to enjoy a multitude of beautiful parks by protecting them from commercial development. It is government that provides an education for my children. It is government which protects freedom of religion and speech and press. Oh, yes, government is the problem all right. If we didn't have all this government we'd all be free - free to live in the jungle.
Oh, I would like some tax cuts all right. I support the president's lowering the 15% bracket to 10%. But since 3 of 4 Americans pay more in FICA - Social Security - taxes that in income taxes, I'd like to see a change there - perhaps exempting the first $10,000 in income to make this "cruelest tax" - so regressive - a little easier to bear. The ceiling on which FICA taxes were paid could be raised to make up the difference. And I'd like to see an expansion of the Earned Income Tax Credit for the working poor so we don't tax low-income, hard-working people back into poverty as we do now.
Our tax system is basically regressive. Social Security, property, and sales taxes all fall hardest on people of low or moderate income. I believe in increasing reliance on the income tax - a progressive tax based on ability to pay. But that is not a popular idea. The administration's tax-cut proposal affects essentially only the income tax and the inheritance tax - cuts which overwhelmingly benefit the "haves" of our society, including many of us, including me. I find that position unjust in the extreme.
According to former President Ronald Reagan, the idea of a progressive income tax came from Karl Marx, "who designed it as the prime essential for a socialist state." In actuality Adam Smith touted it in The Wealth of Nations in 1776; Thomas Jefferson in a letter to James Madison dated October 18, 1785 (Marx was born in 1818), said that a way to lessen inequality in wealth "is to exempt all from taxation below a certain point and to tax the higher portions. . . in geometrical progression as they rise." The question is : Was Jefferson a Marxist or Marx a Jeffersonian?
We Americans live under the myth that taxation is evil. We are an independent lot. Many believe everything we earn is by dint of our favor with God or our unsullied merit. We did it ourselves. Why do we have to give it to government? We ignore the rhetoric of government of the people, by the people and for the people. Government is the people; it's not as if government were some alien creature - the enemy.
I thought of this recently as I worked on "the Self-Sufficiency Standard" for Interfaith Impact of New York State. Based on careful research, it estimates how much is required for various families to live a decent life in 21st century society - not only the cost of food, clothing and housing, but also health care, child care, transportation and other necessities for sustaining a family in reasonable comfort. The figures presented are far above both the minimum wage or the more generous living wage. But that is not the point.
It is the idea of self-sufficiency that hit home. This study is of great use in evaluating social policy, but I have trouble with the idea that any of us are really self-sufficient. Self-sufficiency is a myth. All of us are dependent upon Creation which has spun us into existence through no merit of our own. We are dependent upon the munificent grace of nature, not only for basic physical needs, but also for much of our spiritual pleasure as well. We are dependent upon the good will and the cooperation of our family and our neighbors and our community and - our government. Albert Schweitzer provides an ethical principle to undergird our actions: "good fortune obligates."
And so I like paying taxes. They are the price we pay for civilization and I, for one, am glad to pay them. Paying taxes is an act of civic virtue; an act of ethical altruism; an act of spiritual gratitude. The act of paying taxes is symbolic of our interdependence as people; it is an affirmation of community and our mutual responsibility. It is an investment in our future as a people. Representation without taxation is anarchy.
I know, I am hopelessly naïve. I romanticize taxation. I don't get it. I don't understand that our mission on earth is to get more and give less. I don't understand that what I earn is mine all mine - pure dessert for my hard work. Why should anyone or anything have a claim upon what is mine? It's a good thing I'm not running for office. Maybe I should run for cover instead.
I believe it was Francis Bacon who said, "Money is like manure. If you spread it around it does a lot of good, but if you pile it up in one place it stinks like hell."
I worry about our continued drift toward selfishness - symbolized by that January 20 crowd in Washington that roared approval of tax cuts. Greed is the most evident form of moral underdevelopment. Maybe wanting a tax cut for a person who is better off than all the kings of history is not greed. Maybe I should get with it and stick to the conventional wisdom and get mine while I can. Maybe.
And so I conclude with a picture from Punch magazine in which the minister tells his disgruntled congregation: "If, of course, your life-style is going to be seriously affected, then disregard everything I've said." I hope and pray you won't. But who knows? It's April Fool's Day. Anything can happen.
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