My biggest problem with the modern Republican Party is their seeming abandonment of ideas. They are stuck in a terrible rut lately, and are redeemed (as a political force) only by their incomparable skill at branding. When one takes a serious look at their concepts for solving American problems, a simple pattern emerges. Health care system got you down? Cut taxes. Working class Americans can’t afford insurance? Cut taxes. Manufacturing base eroding? Cut taxes. Energy system a relic from the previous century? Cut taxes.
I have to admit to liking the idea of cutting taxes. Who wouldn’t? Paying the government is one of those steady annoyances that can become too much in light of everything else. You see a chunk of your cash go before you get your paycheck, then you pay sales tax locally. You pay fees to drive your car, own your dog, and start a business. On top of everything else, you pay property taxes. Taxes, taxes, taxes. Then you see the size of the government budget, hear someone screaming about fiscal irresponsibility and wonder, “What the hell am I paying all of this for?”
When you take a breath, and sit down in contemplation, it is easy to get lost in the things you are paying for. Most folks who have ever pleaded in exasperation for “someone to do something about this”, have found relief in some government action. To be certain, not all actions are just, efficient, or necessary. But it is a curious fact that the entire country, including conservatives who don’t want the government involved in business, was furious in its demand that the government fix the Gulf Oil Spill. More curious, were the accusations by conservatives that the Obama Administration did not do enough prior to the spill. Conservatives wanting for lack of deeper government involvement in commerce? Very curious indeed.
We all instinctively recognize that the market can’t handle everything. We all instinctively acknowledge that, were there no traffic cops, we would go to fast. The sum total of all of the fears and recognitions of our mutual shortfalls is expressed in government action; and that action requires money. The commercial infrastructure that the business community in the United States enjoys is payed for in tax dollars. Roads, dams, levees, locks, bridges, and the freedom to operate with limited fear because of the world’s best military, police, and fire protection are all business benefits that taxes pay for. An educated workforce that labors under the knowledge that some level of dignity will attach to retirement is also a byproduct of taxes.
All of the above, with the notable exception of the military, are in decline in America. We are laying off teachers, consolidating schools, and trimming the rolls of police. The American Society of Civil Engineers issues a report card on American infrastructure; in 2009 the grade was a D. The society estimated a 5 year investment of $2.2 trillion was needed to bring our infrastructure back to par. Friends, this is a shortfall in investment that will cripple our nation’s competitiveness in this century. To make it more critical, that estimate does not account for any investment in real modernization of our energy and transportation grids. We are doing all of these things, because we the people have decided against taxes.
It is easy to see where Republicans and others could go wrong on this. The top marginal tax rate in 1980 was 70%, with tax rates on median wage earners in the 24% to 37% range. Cutting taxes from that level to the rates seen in 1989 has the potential to drive a tremendous amount of money into the private sector. In general, that is not a bad thing; providing the private sector is motivated to spend that cash in similar areas as the government. So when one sees the tax cuts of the Reagan and Bush years, one expects to see massive improvements in the U.S. economy. The problem is, we don’t.
Even including the recession, the United States’ gross domestic product, the measure of its economy, has more than doubled since 1980. The number, in 2008 dollars, has moved from $5.8 trillion to $12.8 trillion during that rough 30 year period. In inflation adjusted dollars, median household income during that period has increased by less than 20% (US Census Bureau). Were I in the Tea Party, I might be moved to call that trend wealth redistribution. Clearly, it hasn’t been redistributed in the manner that President Obama has been accused of; quite the contrary. As I am not in the Tea Party, I will only point out that the data does not support the Republican contention that tax cuts are the universal cure all.
To make matters more complicated, many Republicans are now faced with promises they made to constituents regarding the deficit. When you spend your time ranting against taxes and deficits, you will inevitably pay the piper. Even though half of the deficit is a direct effect of the recession, and even though the deficit represents no immediate threat of inflation, and no threat of any kind regarding insolvency, Republicans are now forced to promise that they will cut both taxes and the deficit. Mathematics, of the scope and power that could solve that contradiction, haven’t yet been invented.
The result; we cut services. We lay off teachers, police, and firefighters at the state and local level. We put off road construction and maintenance. We continue to fall farther behind China in the development of new energy products. We contemplate raising the age of Social Security…again. We contemplate reducing the benefits of Social Security. We may even cross the sacred threshold and make real cuts in defense spending. All of this because we aren’t mature enough to have reasoned discussions on tax rates…and to call them taxes. In the last thirty years, the United States has gone through an orgy of tax-cutting, union-busting, regulation-suspending, and accounting-rule changing; all revolving around the premise that what is good for big business is good for America.
With all of this good for America activity, where have all the good jobs gone America? It should be instructive to all, that when people think fondly back to the good old days, they are remembering times when the taxes were higher. We don’t like to pay them, but we the people seem to like the results when the government of the people, by the people, and for the people does positive work with those taxes in our communities. I don’t think that we ought to go back to the top-marginals in existence before President Reagan, but we ought to at least be able to have conversations about taxes and their efficient application without having to worry about Rush Limbaugh or Grover Norquist calling us names.
The Rational Middle is curious about your feelings on this subject…