Taxes and Transparency

I won't pretend to have much background in American tax policy. Like most Americans, I figure that of the two certainties in life, death is by far easier to understand than taxes. But as I was ready to post my prior draft - a firm populist rant which more or less said that I don't have any philosophical problem at all with someone making seven times my income paying more in taxes proportionally than I do, I realized the problem really isn't with what is being proposed.

I'd like to understand our tax code, and I'm with Hector that I think it is a fundamentally good thing if taxes were more transparent. But I'm not at all convinced that simplicity in the tax code in itself is a holy grail - it's probably bad memories of Reagan assuring everyone that the benefits of his tax breaks would eventually trickle down to the rest of us. I'm sure that there is much more to the story about why those benefits never seemed to arrive, but that's the perception I think I share with most Democrats: that they never arrived. Instead, it seemed that the gap between the working class and the upper class got wider - regardless of how all Americans seem to want to consider themselves "middle class."

This perception I freely admit may not have anything to do with reality. But there is no source I can really look to for information. Almost any news source is open to charges of a political bias. Almost any government official has a vested interest to protect. So where do you go to separate fact from fiction? Classical economic theory to predict how a marketplace behaves seems far removed from a world of imperfect information, unequal bargaining power and mounting federal obligations.

This isn't a perfectly performing capitalist machine that we live in, and there is no doubt that there is definitely an element of social re-engineering in any tax policy that is advocated - liberal or conservative. Why is it that the words 'social' and 're-engineering' are always put out there as liberal goals? Hector seems to assume that Democrats are using the tax code as some blind for funding underhanded programs Americans don't know of. Let's face it - every party does that, and this government, supposedly the party of small government, is as guilty as any other.

The problem isn't that Americans are unaware that our federal government spends a lot of money on a lot of programs. The problem is that Americans aren't given concrete policy information to evaluate those choices. This administration's commitment to secrecy has done more to shortchange Americans in that respect than any other in recent history.

If we can't understand our tax policy - if we can't understand our budget - then there is no way for us collectively to decide what those social re-engineering priorities should be. If we can't get access to information that tells us how our programs are performing, or how candidates would like them to perform, then the majority of Americans will always be captive to the handful who do have that information. And there is no incentive here for anyone, either a candidate or an elected official, to share that information.

It's not that most Americans can't understand tax policy. It's that most Americans don't have any frame of reference for doing so. Certainly our political leadership is uninterested in really discussing substantively any plans - most likely, they feel that platitudes are sufficient to convey their general feelings on any given subject. Detail always seems to lead to trouble in campaigns. Attempts to explain nuance are seen as waffling. Apparently Americans prefer their leaders to be single minded in all things, making politics the only profession that rewards ignorance.