Peyton has posted a rejoinder to Max, trying to buttress his initial claim that it is “inappropriate for 73 percent of federal income taxes to be paid by 10 percent of the American population.”
I am struck by a few things from Peyton’s post, and I want to pull them out and talk about them directly.
First, Peyton argues that we should not consider the FICA tax when assessing the overall progressivity of the tax system, because, he says, those who pay FICA taxes “receive direct monetary benefits during retirement.” The idea here seems to be, if I may put it crudely, it’s not really a tax if you’re getting it back eventually. But when conservatives lament the overall tax burden that falls on, say, the top 5% of American earners, I am pretty sure they include FICA. Otherwise, taxes would seem pretty darn low! Moreover, the FICA tax isn’t the only one that is remitted back to the people in the form of some service or benefit. Peyton helpfully lists these: “the U.S. military, benefits for veterans and federal retirees, federal support for education, transportation and infrastructure, and international affairs, and the numerous other areas of federal spending not directly tied to workers’ retirement welfare.” Now, liberals and conservatives disagree about how much money should be spent on such things, and how cost-effective our current spending is, but we don’t try to calculate what proportion of our taxes is eventually remitted back to us in the form of services and benefits, and then say that only the remainder, only the waste that is, is our real tax burden. To sum up, taxes are taxes.
Second, Peyton responds to the point that everybody also has to pay state and local taxes by saying that these taxes “vary tremendously from state to state and from locality to locality.” Of course. But Republicans and conservatives media figures have been pushing the narrative for at least a week that 47% of Americans just don’t pay taxes, period. Even when they take care to say “federal” taxes (which they don’t always do, as I found out yesterday when I flipped to Fox News), the implication is clear to everyone: half the country is a bunch of freeloaders, and the other half is paying their way. One Tea Party sign, quoted by the New York Times today, read: ““I’m the 50 percent stuck paying for the other 50 percent.” If that were true, it would be quite objectionable. But it’s just not true, and the existence of state and local taxes makes it not true. Peyton can’t do these two things at once: recognize basic facts about our system of government, and imitate or justify the moral outrage of the Tea Partiers.
Finally, Peyton has a very interesting psychological argument about how voters who don’t pay much in taxes might not be responsible stewards of our fiscal future. But I don’t understand the leap from saying “I ultimately don’t pay the federal government any income taxes” to saying “I have no stake in anything the federal government funds.” Obviously this is the kind of thing that’s easier to say than to show, but I just don’t think people reason like that. It’s not that Peyton’s being too cynical, as he worries. It’s that he’s not being cynical enough! Voters don’t go through those sorts of calculations. Many if not most people vote out of atavistic party loyalty; many others vote based on the personal characteristics of candidates; many vote on symbolic issues or issues unrelated to taxing and spending; and many people who care about the deficit also don’t much in federal income taxes (unless we are to suppose that all fiscal conservatives are in the top 53%).
I also object to Peyton’s claim that “Such programs are all benefit and no cost for the bottom 47 percent of the country.” Just to pick an easy target, I hardly think it’s the case that military spending is all benefit and no cost for the poorest Americans. Not when they’re the ones fighting our wars.
Ultimately, I agree with Peyton that this debate comes down to irreconcilable moral positions. But I still think we need to get our facts straight, and talk about these issues with complete candor and statistical rigor. And as for the moral side, I’ll just say this: Peyton might be right that all citizens ought to have a stake in how the government spends its money, but I’m not willing to worsen the living conditions of the working and middle classes just to satisfy this abstraction.
Photo credit: Ezra Klein
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