Public Policy and Governance – Page 29

A Rant About Taxes

In Red states like Indiana, legislators and business interests routinely spout–and clearly believe–a lot of persistent claptrap about taxes. Taxes are bad. They should be minimized whenever possible. They may be–like death–unavoidable, but that doesn’t mean we shouldn’t do whatever we can to avoid them.

Are there problems with this reflexive approach? Let me count the ways….

Being indiscriminately anti-tax is probably the most fundamental error in today’s political discourse. To state the obvious, governments need resources if they are to provide the services we demand. The proper way to approach any system of taxation is to ask, first of all, whether We the People are getting our money’s worth. Are we getting value for the dues we pay to live in a civilized society?

When people who can afford it decide to join a country club, they evaluate the appropriateness of the dues they will pay by considering the benefits of membership. When my husband and I decided to take the cruise we are currently enjoying, we focused on what was included in the (considerable) fare being charged. Yet, when it comes to taxes, people rarely focus on the variety and appropriateness of what our dollars are buying.

The proper questions are: how are public services being delivered? Are tax dollars being wasted on services we don’t need government to provide? In the alternative, is the failure of government to provide a particular service costing individuals far more than a collective approach would cost them? (Health insurance comes to mind…) Is there credible evidence of corruption or inefficiency we need to address?

Beyond that fundamental issue of value for our tax dollars, discussions of tax policy need to focus on the fairness and transparency of the system. The question shouldn’t be whether to impose, raise or lower taxes–the question should be how. What are the pros and cons of property taxes versus income taxes? What is the difference between a justifiable tax incentive and a politically-dubious loophole?

It is so much easier for politicians to rail against taxes and tax rates than to get “down in the weeds” of tax policy.

What triggered the foregoing diatribe was a recent commentary in the Capital Chronicle that focused on revelations from a recent hearing of the General Assembly’s State & Local Tax Review Task Force. The hearing was held to consider proposals (floated by legislators and at least one candidate for Governor) to replace the state’s personal income tax.

Testimony at the hearing pointed to the considerable downsides of that proposal–it turns out that, among other problems, eliminating state income taxes would put a greater burden on the Hoosiers who already pay the largest share of their income in taxes.

But national experts also laid out a framework that would give Indiana’s lawmakers the opportunity to rethink how the state’s tax and budget structure can unlock Indiana’s true economic potential and allow all Hoosiers to thrive.

Some of the testimony presented to the Task Force was truly jaw-dropping. For example, The Tax Foundation testified that at 7%, Indiana’s sales tax rate is tied for second-highest in the nation (behind only California), and that it is “definitely not possible” to properly eliminate or replace the individual income tax.

Furthermore, the Institute on Taxation and Economic Policy (ITEP) demonstrated that not only do lower-income Hoosiers currently pay nearly twice the proportion (12.8%) of their incomes in state and local taxes compared to the wealthiest households (6.8%), but that Indiana already has the 12th-most regressive state tax structure in the country.

ITEP also showed that eliminating the state income tax would provide a windfall of $33,964 for the top 1% of earners, but a mere $203 for the bottom 20% of Hoosier earners. Likewise, replacing half of the income tax with a 9.5% sales tax would still gift $29,507 to the wealthiest while causing a net $62 tax *hike* for 1 in 5 Hoosier families.

Legislators like to characterize a low tax rate as a magnet, insisting it will draw people and jobs to the state. But as the commentary notes,”Indiana’s tax system isn’t making the state competitive even in the Midwest, where Indiana is worse than average in the region for real median wages, unemployment rate, poverty, and low wage jobs throughout the economic recovery of the past three years.”

And women sure aren’t moving here for reproductive health care…

Again, the issue isn’t cost; it’s what value are we getting for our dollars?

As the commentary notes, Indiana could fully fund affordable housing programs, universal child care, and tuition-free technical education–all for less than the revenue that would be lost from the proposed, lopsided tax cuts.

Maybe it’s just me, but I’d rather pay dues to the club that keeps the roof repaired and the chef paid…

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Rebooting…

I ended yesterday’s post with a very fanciful “reboot America” suggestion. I’m sure our contemporary MAGA warriors would love to reboot the country–they’re working hard to to take us back to before the civil war, when men were men and White Christians were in charge–but as I was mulling over my very silly premise, I realized that one of my favorite final exam questions actually did ask my graduate students how they would reboot governance. (It was a take-home exam.)

This was the question:

Earth has been destroyed in World War III. You and a few thousand others—representing a cross-section of Earth’s races, cultures and religions—are the only survivors. You have escaped to an earthlike planet, and are preparing to establish a new society. You want to avoid the errors of the Earth governments that preceded you, and establish a governance system that will be stable and fair. What institutional choices do you make and why? Your essay should include: The type/structure of government you would create; the powers it will have; the limits on its powers, and how those limits will be enforced; how government officials will be chosen and policies enacted; and the social and political values you intend to privilege.

Most of the students responded with a modified version of American governance–three branches, rule of law, equal rights, democratic elections and a variety of “tweaks”–interestingly, the tweaks usually included getting rid of the Electoral College, adopting national health care and paying considerably more attention to environmental issues. Students also tended to constrain–but not eliminate– capitalism. Others were more creative; I recall one student who suggested that the new world order should start with a benevolent dictatorship–with him as dictator– until the time was right for democratic governance. (I’m pretty sure that was tongue in cheek…)

Anyway–remembering that essay question made me wonder how those of you who comment here might answer it. There are a lot of obviously bright, highly educated folks who offer thoughtful commentary to my daily meanderings, and I’d be very interested in your individual “pie in the sky” suggestions.

If you were answering my exam question, what social and political values would you make the centerpiece of a new world order? What systems would you build in, and what mechanisms for change? What problems do you wish America’s founders had foreseen, and how would you guard against the inevitable unforeseen, unfortunate consequences of your favored policy choices?

Go to it! Imagine a reboot of government– but no fair “rebooting” humans to make us nicer and less tribal and easier to govern. Just focus on the governance system…

If pigs could fly, what would your ideal government look like?

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Twenty-First Century Puritans

Being out on the ocean prompts reflection…

When I taught Law and Public Policy, I approached the material through a constitutional lens, because I was–and remain–convinced that a basic understanding of American history and the philosophy that shaped what I call “the American Idea” is critically important for anyone hoping to understand today’s politics.

The American Constitution was a product of the 18th Century cultural, intellectual and philosophical movement known as the Enlightenment. Most of us know that the Enlightenment gave us science, empirical inquiry, and the “natural rights” and “social contract” theories of government, but what is less appreciated is that the Enlightenment also changed the way people today understand and define human rights and individual liberty.

We are taught in school that the Puritans and Pilgrims who settled the New World came to America for religious liberty; what we aren’t generally taught is how they defined liberty.

Puritans saw liberty pretty much the same way current politicians like Mike Pence and Mike Johnson do– as “freedom to do the right thing” as they definied it. That meant their own freedom to worship and obey the right God in the true church, and it included their right to use the power of government to ensure that their neighbors did likewise.

The Founders who crafted the American constitution some 150 years later were products of an intervening paradigm change brought about by the Enlightenment and its dramatically different definition of liberty.

America’s constitutional system is based on the Enlightenment concept of liberty, not the Puritan version. It’s an approach we sometimes call “negative liberty.” The Founders believed that our fundamental rights are not given to us by government (nor necessarily “God given” either). Most of them–especially the Deists– believed that rights are “natural,” meaning that we are entitled to certain rights simply by virtue of being human (thus the term “human rights”) and that government has an obligation to respect and protect those inborn, inalienable rights.

That philosophical construct is why–contrary to popular belief–the Bill of Rights does not grant us rights—it protects the rights to which we are entitled by virtue of being human, and it protects them against infringement by an overzealous government. As I used to tell my students, the American Bill of Rights is essentially a list of things that government is forbidden to do. For example, the state cannot dictate our religious or political beliefs, search us without probable cause, or censor our expression—and government is forbidden from doing these things even when popular majorities favor such actions.

Most Americans today live in a post-Enlightenment culture. We accept and value science. We understand liberty to mean our right to live our lives free of government control so long as we are not harming others, and so long as we respect the right of other people to do likewise. But there is a persistent minority that has never accepted an Enlightenment worldview, and that minority currently controls the Republican Party. These contemporary Puritans–who, along with their other religious convictions tend to see Black people and non-Christians as unworthy subordinates– use the word “freedom” in the older, Puritan sense of “freedom to do the right thing” as their reading of their holy book defines “the right thing.” They also believe it is government’s job to make other citizens do the “right thing” –to impose their version of “Godliness” on the rest of us.

These contemporary Puritans are throwbacks to the early American settlers who defined “liberty” as the imposition of the correct religion on their neighbors. The Enlightenment construct of “live and let live”–the notion that each of us should have the right to believe as we wish, the right to follow our own set of moral imperatives (again, so long as we are not harming the person or property of someone else) was utterly foreign to those original Puritans, and it is evidently equally inconceivable to their philosophical descendants.

(Interestingly, these throwbacks to Puritanism never seem to doubt that they know precisely what God wants–that, as a friend once put it, God hates the same people they do. But that’s a phenomenon for a different post.)

If you had told me ten years ago that American government would once again be under the thumb of Puritans, I wouldn’t have believed it. But here we are–with a Speaker of the House of Representatives who is a full-blown Puritan throwback and a Republican Party that has rejected the Enlightenment.

When I have computer problems, I reboot. That usually returns my laptop to working order. Can we reboot America?

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Taking The Country Down With Them

In the run-up to electing a Speaker of the House, Moira Donegan considered the underlying reason for the GOP’s chaos. She wrote that “Republicans have no interest in public service, an ideological hostility to functional government and an insatiable thirst for attention.”

As Donegan also noted, there are few, if any, adults in the GOP’s room.

The “adult in the room” is a person willing to make difficult compromises, a person willing to sacrifice vanity for pragmatism, a person with a clear eye of their own priorities and needs and more determination to achieve them than a desire to make a point.

What the Republicans need, she wrote, is

someone more level-headed and serious, someone willing to accept imperfect compromises and to subvert his own ego for the good of the party, someone who might even possess a quality that passes for dignity.

Evidently, someone who isn’t currently a Republican.

Donegan was writing before the House GOP settled on someone who is emphatically not the adult she described. Instead, the GOP chose a previously-unknown theocrat with a dubious past, a set of extreme rightwing bigotries and a total lack of any leadership experience.

Donegan’s essay was written just after Jordan and Scalise had both failed to grab the brass ring, and she pointed out that these men– both “extremists and election deniers, comfortable with white supremacy and willing to discard democratic principles.”–had “ascended to what counts for leadership in the Republican conference, not in spite of the depravity of their positions, but because of them.”

They are the products of rightwing political, fundraising and media apparatuses that incentivize candidates to move further and further to the right – and which have left the Republican party itself both unable and unwilling to impose discipline on its politicians…

In a project that spanned decades, Republicans and their allies built a vast conservative media infrastructure and developed an impressive skill for shaping and whetting the ideological appetites of their audience, creating a more and more conservative base.

And as we now know, Republicans proceeded to elect extremist and election denier Mike Johnson as Speaker. Johnson was aptly desscribed by Jamelle Bouie as a right-wing fever dream come to life.

Mike Johnson is neither a moderate nor an institutionalist. Just the opposite. A protégé of Jordan’s, he comes, as you have doubtless heard, from the far-right, anti-institutionalist wing of the congressional Republican Party. And while he was not a member of the Freedom Caucus, he did lead the Republican Study Committee, a group devoted to the proposition that any dollar spent on social insurance is a dollar too much….

And what does Johnson believe? He is staunchly against the bodily autonomy of women and transgender people and supports a nationwide ban on abortion and gender-affirming care for trans youth. He is also virulently anti-gay. In a 2003 essay, Johnson defended laws that criminalized homosexual activity between consenting adults. In 2004, he warned that same-sex marriage was a “dark harbinger of chaos and sexual anarchy that could doom even the strongest republic.” Last year, Johnson introduced legislation that has been compared to Florida’s “Don’t Say Gay” law, and he continues to push to overturn Obergefell v. Hodges, the Supreme Court decision that legalized same-sex marriage nationwide in 2015.

If Johnson is known for anything, however, it is for his tireless advocacy on behalf of Donald Trump’s attempt to overturn the 2020 presidential election.

As Bouie accurately notes, Johnson is Jim Jordan in substance but not Jim Jordan in style, which was evidently enough to win him the coveted title. Media, which had previously ignored Johnson, has begun an “after the fact” investigation.

The Guardian, for example, found that Johnson is “a believer in scriptural originalism, the view that the Bible is the truth and the sole legitimate source for public policy.”

Chalk up his elevation to the speakership as the greatest victory so far within Congress for the religious right in its holy war to turn the US government into a theocracy.

Since his fellow Republicans made him their leader, numerous articles have reported Johnson’s religiously motivated, far-right views on abortion, same-sex marriage and LGBTQ+ rights. But that barely scratches the surface. Johnson was a senior lawyer for the extremist Alliance Defending Fund (later the Alliance Defending Freedom) from 2002 to 2010. This is the organization responsible for orchestrating the 303 Creative v Elenis legal arguments to obtain a ruling from the supreme court permitting a wedding website designer to refuse to do business with gay couples.

There’s much, much more.

This delusional ideologue is Speaker of the House at a time when the U.S. faces a government shutdown and the global imperatives of two hot wars.

I suppose it could get worse, but I’m not sure how…..

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I Plan To Buy This Book

I have previously quoted Nick Hanauer, a billionaire with a clear vision of economic reality and a refreshing respect for data and evidence. I first encountered him when he was supporting Seattle’s “Fight for $15.” He pointed out that jobs are created when workers have sufficient disposable income to purchase the goods offered in the marketplace. (If no one is buying your widgets, you are very unlikely to hire additional people to manufacture them.)

In the absence of any empirical evidence,” Nick explained, business owners kept repeating the same false threats over and over: “It’ll be a job killer. It’ll harm the very people it’s intended to help.” Even though these warnings had no basis in economic research, local media repeated the lies uncritically.

Seattle did, in fact, raise its minimum wage, and despite the dire warnings from opponents of the measure, its economy survived. Nicely.

Hanauer was introduced to Donald Cohen, who had noticed a similar effort– businesses arguing that safety regulations kill jobs–and the two of them teamed up to collect other examples. There turned out to be a clear pattern: whenever a social benefit has been proposed, powerful voices have warned that the policy would only hurt the very people it’s intended to help.

They decided to write a book, and enlisted progressive author Joan Walsh. The three of them have produced a volume they’ve titled “Corporate Bullsh*t,” tracing decades of (surprisingly similar) arguments from America’s captains of industry—against abolition, against child labor laws, against women’s suffrage….

There’s a pattern.

According to a letter sent by a friend describing the book (no link available), the book uses a lot of humor to make its point. As Hanauer is quoted,

If you think that you are going to talk the Chamber of Commerce out of saying that raising wages kills jobs by showing them the economic evidence [to the contrary,] you are deeply, deeply naive,” Nick says, adding that ridicule plays “an essential role” in debunking these claims and changing the public conversation for good.

A review of the book from The New Press goes into more detail:

From praising the health benefits of cigarettes to moralizing on the character-building qualities of child labor, rich corporate overlords have gone to astonishing, often morally indefensible lengths to defend their profits. Since the dawn of capitalism, they’ve told the same lies over and over to explain why their bottom line is always more important than the greater good: You say you want to raise the federal minimum wage? Why, you’ll only make things worse for the very people you want to help! Should we hold polluters accountable for the toxins they’re dumping in our air and water? No, the free market will save us! Can we raise taxes on the rich to pay for universal healthcare? Of course not—that will kill jobs! Affordable childcare? Socialism! It’s always the same tired threats and finger-pointing, in a concentrated campaign to keep wealth and power in the hands of the wealthy and powerful.

Corporate Bullsh*t will help you identify this pernicious propaganda for the wealthiest 1 percent, and teach you how to fight back. Structured around some of the most egregious statements ever made by the rich and powerful, the book identifies six categories of falsehoods that repeatedly thwart progress on issues including civil rights, wealth inequality, climate change, voting rights, gun responsibility, and more. With amazing illustrations and a sharp sense of humor, Corporate Bullsh*t teaches readers how to never get conned, bamboozled, or ripped off ever again.

I haven’t read the book yet, so I am approaching it with my own prejudice: the importance of credible empirical evidence.

If X is damaging, how do we know? Has it been tried? Under what circumstances? With what results? Have those results been replicated?

It is perfectly possible for a well-meaning policy to be unworkable or damaging–but an assertion to that effect needs to be backed up with evidence, not rhetoric.

Americans have a bad habit of giving credence to arguments made by the wealthy and powerful simply because those making the arguments are wealthy and powerful. It reminds me of that lyric from “If I Were A Rich Man.” “The most important men in town would come to call on me, asking questions that would cross a Rabbis eyes–and it won’t make one bit of difference if I answer right or wrong…When you’re rich they think you really know.”

Come to think of it, that goes a long way toward explaining why naive people listen to Trump…

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