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Lower Taxes? You Can’t Handle It.

Posted by POLIMOM in Economy, Politics, Society.
Apr 30th, 2009 | Comments

I had an interesting conversation with a friend today about a boardwalk that has been constructed on the beach in her city. It’s a lovely walkway — I’ve been on it — and it was built with funds designated some years ago. You know… back when cities were flush (or at least solvent).

But a beach boardwalk rests upon sand. Which blows. And so, the obvious is occurring: the boardwalk is being covered.

My friend isn’t particularly bothered about this (yet), but while out walking, she encountered someone who is. He wondered aloud to her when the city was going to get somebody out there to take care of it.

Cities, of course, are not rolling in money right now, and her city in particular is having to cut services and benefits to keep going. And so she asked him why she thought the city needed to spend the little money they have on something its citizens could easily do?

“Get a neighborhood committee together, get some brooms, and go sweep it off if it’s bugging you.”

You can guess where I’m going with this by now, right?

Nobody likes taxes — and that’s a truth that the political parties have used as bait for many years. But it’s meaningless hot air, as long as people are unwilling to take on the tasks and responsibilities themselves.

I hear lots of talk lately about how things were done “back in the day”, when government was local. Yet every single time a bond comes up in a city, there are people fighting against it. Do folks not realize that “back in the day”, the citizens performed mandatory civic tasks like roadwork, or common-area maintenance?

When’s the last time you saw anybody mowing their own neighborhood common ground?

The direct result of lower taxes is smaller government — an outcome I’m all in favor of. But I really, seriously doubt that society is prepared to pick up the slack.

Cross-posted from Polimom, Too.

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Ryan

Yes, but it's a winning electoral strategy to do things with borrowed money. Low taxes, good services, and some indefinite future possible catastrophe you might not even be around for anyways.

Polimom

Ryan, you're right. "Lower taxes" is often an empty slogan used by politicians to provoke a Pavlovian voter response.

For taxes to EVER begin to go down, somebody would have to stand up and tell the truth to people: yes, we can lower taxes. Tell me which services you're willing to provide for yourselves (or alternatively and more directly, we're going to discontinue this specific service to reduce your taxes by 'x').

It's considered political suicide to do so. Cutting taxes = good! Cutting services = bad!

We're a spineless bunch.

CStanley

PM- at least with local taxes, people have a better idea of how the money is spent and can make more informed decisions. Once our money goes to Washington DC, all bets are off and it becomes nearly impossible to say with any specificity what should be cut.

Polimom

CStanley, you're quite right. It gets incredibly tangled very quickly at the federal level.

Over at the Chronicle, for instance, the example of "Volcano Monitoring" (aka Jindal's Folly) was just introduced in the comments. That's a whole different level than... say... municipal trash pick-up.

T-Steel

Agreed CStanley. I've been making myself more informed in about the local tax situation in my lil' Georgia town. I feel much better knowing exactly where my tax dollars are going. But like many massive corporations, DC government has way too much incoming and outgoing with little transparency. It's part of the reason why I've never voted for any political party on the federal level. At least locally, I know what's going on most of the time.

CStanley

T- In one of the threads yesterday I asked what the GOP could do to attract a self professed "center left" guy like yourself. In the back of my mind, one of the thoughts I had was that the federalist approach might make sense to you. It seems to me that this was one of the big selling points of Reaganism, that made the conservative message more palatable to people who still think that the government has a place in solving community problems. Do you agree with that? IOW, rather than just preaching small government/low taxation, that the GOP should but the focus back on devolution of the federal government, and addressing community problems on the community or state level?

jwest

PM,

Although I agree there is less direct civic participation today than in “the good old days”, I still believe that, given the chance, people will surprise you by rising to the occasion.

Local politicians love to use the specific program elimination to sell their tax increases, like threatening police or fire cutbacks while leaving the “Coloring For Consensus” program untouched.

Conservatives have faith in people, liberals have faith in government. Don’t be too cynical. Ordinary people have done the right thing for thousands of years, they will continue even without a government program to do it for them.

CStanley

Just to shine light on what seems to be a really good example of the process of local scrutiny working well, our GA legislature recently enacted a balanced budget that was reponsive to voter's concerns over certain essentials that we didn't want cut.

There was a lot of outcry when the state suggested that it might have to cut school budget line item for school nurses, and to some extent this seemed like the scare mongering that Jwest is referring to. But in this case, I do feel that our legislators rose to the occasion, and when people said "no, don't cut there" they didn't use that as an excuse to say, "OK, then we're either going to have to raise taxes or use deficit spending" (the latter would require repeal of our balanced budget amendment.) Instead, they appear to have done due diligence to find wasteful spending in the budget and cut it in order to reconcile the budget.

DaGoat

For taxes to EVER begin to go down, somebody would have to stand up and tell the truth to people: yes, we can lower taxes. Tell me which services you're willing to provide for yourselves (or alternatively and more directly, we're going to discontinue this specific service to reduce your taxes by 'x').

This is kind of a straw man argument since as others have said taxes at the federal level are so opaque that it's hard to tell what services you're actually getting. I think there are exceptions, though. In the case of earmarks I can say most of them are local issues that should be decided and paid for locally. In the case of a high-speed rail system I can say that is a project that should wait until the government is more flush.

I live in Iowa and one of the earmarks is to study hog farm odor here in Iowa. Although that sounds like a joke it really is very important to the Iowa economy. Nevertheless I think that is a project that should be funded at the state level if at all. I doubt there is going to be outrage from Iowa voters if we don't get a federal hog farm study.

CStanley

In the case of earmarks I can say most of them are local issues that should be decided and paid for locally. In the case of a high-speed rail system I can say that is a project that should wait until the government is more flush.

Hear, hear, DaGoat. Even though neither of those items (banning pork or putting off high speed rail) is going to come close to balancing the budget, at least they demonstrate fiscal responsibility based on the right first principles of accountability and affordability.

And both involve a more significant amount of cost reduction than the toe nail trimming that Obama recently announced.

Rudi

CS Don't pat your state Congress just yet, only a couple of the fifty states are allowed to run deficits. States run balanced budgets by constitution mandate, not because of the love of tea.

CStanley

Yes, I already acknowledged that we have a balanced budget amendment in our state constitution, Rudi. My point is that they didn't use that as an excuse to raise taxes or fees, but instead made (what appear to be) sensible cuts.

shannonlee

As many people have already stated...faith in local government to do what is best for the community is what we really need. The federal government is too big and involved in too many micro issues. Our tax money is used for political survival, not for what our communities or country needs.

Garvey

Your post is honestly one of my favorites ever to appear on The Moderate Voice. You cut to the core, as so many comments before mine point out. I just wanted to say thank you.

Polimom

shannonlee said: "faith in local government to do what is best for the community is what we really need"

Faith in local government. There's a thought. I have to tell you, though, that these days, right or wrong, I see government at every level as pretty suspect. Whether that stems from frustration at the ballooning entities generally, or just projection from the federal goat rope is hard to say, but faith is definitely missing.

Garvey -- wow. Thank you very much. What a nice comment -- and doubly welcome, since this was my first post here at TMV in a VERY very long time.

Polimom

"I still believe that, given the chance, people will surprise you by rising to the occasion."

jwest, it wasn't until I was writing this post (and then thinking about various comments here and over at the other post) that I realized how very cynical I've become. It bugs me to recognize that in myself, but you're right. I would be surprised.

CStanley

PM, I'm similarly a cynic and I agree with your critique of the use of 'faith'. But I do still believe in Reagan's adage, 'trust but verify.' And on local issues, it's not that hard to see the proof in the pudding and have that ability to verify.

In our community, we've funded quite a few park and school improvements through ballot initiatives for local sales tax with designated purpose. It's done through a GA state program called SPLOST, which allows counties to tack on up to 2% sales tax for projects that get voted by referendum on the ballot. Of course, true to form, some of our local politicians have now corrupted this system by borrowing against future SPLOST income (to the tune of the next 25 years of projected income being earmarked- and the state law doesn't allow for further increases above the 2%.)

So what could be a logical (and accountable) way to fund community needs is now all but useless for further needs. And it's especially egregious since there's been overuse of this method of funding for new school construction instead of requiring sensible impact fees from developers and/or donation of land for schools (in several cases land was set aside for school construction but- surprise, surprise- when it came time to build it was suddenly discovered that the land was unsuitable.)

So I think that our cynicism is well founded, frankly.

But at the same time, what jwest says is true as well- I don't think that citizens will refuse to pay for legitimate needs, as long as they see the money being properly spent.

mikkel

What do you think the Fed's role should be? I ask this to someone that I know live(d?) in Louisiana where the local governance was so corrupt that the state would have sunk to third world status without Federal intervention. The sad fact is that I've lived many places and always perceived federal government to be grossly inefficient through its bureaucracy but local governance to be downright incompetent and corrupt. Course some of that could be what comes out of pocket...my federal taxes are much lower than state/local.

CStanley

I'd forgotten that you were a onetime resident of LA too, Mikkel- don't tell me that you're a Ben Franklin alum as well (PM and I just discovered that we both went to the same high school in NO- and it's a pretty tiny school, so I find the coincidence pretty remarkable!)

Anyway, I certainly get your point about corrupt local governments- but when you live in an area that's not like that you see how it can work (despite having to have voters who keep them on our toes as I mentioned with our local politicians.) But at least at the local level, some semblance of oversight is possible. I think the problem comes in the cities and towns where people have come to accept that the corrupt officials are the ones who 'get things done', which I know has been the mentality in LA. Even Huey Long had his populist version of this in his rhetoric back in the day- he didn't claim he was going to clean up the govt, just that he'd have corrupt guys working with him, for the folks.

Polimom

@ Mikkel -- Oddly, I thought of LA before I ran this post -- because I think states like that help make an argument in favor of distributed federal money. In Louisiana's case, there were / are a wealth of natural resources (oil & gas, the River) -- but because corrupt politicians in the past made deals with the government that were short-sighted, they've been unable to reap any benefit from their own best income producers.

So a generation later, they're stuck, and leaving part of the country in poverty (it's not just LA) does not further the interests of the nation.

So that's an aspect (not the only one by any means) where I'm really torn.

pacatrue

FYI, I grew up in Louisiana, too, but in a small town up near Monroe. Pete Abel, I think, tried to address some of these issues several months ago with a post about a more networked government. I think the rough idea was that the federal govt could try to set standards and enforced goals, but that state and local governments would be free to meet those goals as they chose. An example of my own that fits with some of these comments might be that the federal government could enact a set of transparency standards that local governments must meet, but then stay out of the way.

I've actually been meaning to work up a guest post on why liberals should like states rights, too, but haven't gotten around to it.

shannonlee

Poli...I find local politicians to be much more answerable to the people than our state and especially our federal officials. As soon as a politicians office is removed from their constituents, it becomes much easier to forget the people they sent to represent. Also, in a democracy, you get exactly what you deserve. Local political corruption is usually found within the most corrupt populations. In these cases, I believe this is where state police and FBI should be more involved.

The federal government is good at a lot of things...big things. It is there as a framework in which the states can work together for common needs. I think when it comes to issues of morality within the bounds of the constitution, it needs to leave that to the states. I also just don't understand why I pay federal taxes that are then allocated back to my state to repair a highway.

HemmD

I think the 800 lb gorilla in the room is just where is the line drawn? Who's not for keeping the Federal govt out of trash collection or sand sweeping? I know noone is saying these are not local issues, but some community problems over-run local coffers or require intervention. Community service can take care of the little stuff( and should IMO), but that's not where Federal billions are spent.

For example, I know many who have commented here were absolutely against the stimulus, but for states and communities devastated by the downturn, the 'smaller government' meme falls apart. The argument then is smaller govt until we need you.

Calling for smaller govt is fine; but don't you have to state very clearly where this idea fits into the various situations we all know will occur. Without that clear delineation, smaller government is just becomes another political sound bite.

Polimom

HemmD, I think maybe the various levels of government have gotten mixed together in your comment.

"Who's not for keeping the Federal govt out of trash collection or sand sweeping?"

Those are very local level examples. I can't even imagine a scenario where the fed is involved in such activities. (horrifying thought!)

"...for states and communities devastated by the downturn, the 'smaller government' meme falls apart. The argument then is smaller govt until we need you."

But right there, you come back to the point. States and communities can, in fact, handle a lot of this without the fed. But neither the people nor the the fed seems to think so.

HemmD

PM
"Those are very local level examples. I can't even imagine a scenario where the fed is involved in such activities. (horrifying thought!)"

It wasn't meant as a snark or a trap, but billions in Fed money goes directly to Hurricane and tornado cleanup all the time. People see that as a blessing when FEMA shows up. You may see that as an extreme example, but it demonstrates what I was questioning.

I believe you have to define the scope very carefully, or else the general concept fails to be implementable. It's like you asked, "If you want lower taxes, what services are you willing to give up?" 20% unemployment likewise requires outside intervention just as much as storm damage.

mikkel

Yeah but which areas of the country are models for good local governance? The Gulf South? Very corrupt. The Rust Belt? Corrupt. The Eastern Seaboard? Corrupt. Stereotypically speaking the only places that aren't are the "farming" states, the western interior and coast, sans a lot of California and New England. Dixie south isn't that bad I guess.

I mean I've lived in a place where the local government was excellent, provided more public transportation and other services than most big cities, had great schools and didn't have any higher tax rates than elsewhere, but that was the exception, not the rule. I'm just not convinced that the Federal Government is the source of most of the day to day problems.

That said, I don't think that Federal control is the answer either. But there needs to be some sort of network for oversight, sharing resources etc that local govts can use.

CStanley

I think it's more individual communities rather than generalizing according to region, though I think that the patterns you describe are true in a broad sense.

And I think it's a matter of the citizens being involved and providing oversight, really. One problem I find here is that we're in such a conservative area that most of the GOP run unopposed, and I think whenever one party dominates like that you end up with a lot of fraud and corruption (that said though, our area isn't too bad but there are certain issues like too much collusion with developers.)

I also feel that online tools and transparency can work a lot better at the local level, and I was pleased to discover that we have a watchdog group for my county and that some of our state officials have set up websites where you can easily access information about budget and project oversight.

I don't think those things are all that useful at a federal level- though it's better to have the daylight than not, of course- but I don't think most people could glean much meaningful information from a federal department budget.

Here's the county citizens group website I'm referring to. It's a fairly new group and their website isn't completed yet, but you can get an idea of how I think this sort of thing can be very useful (there's all the contact info for our country officials, and explanation of some current issues relating to rapid growth, zoning, and water/sewerage.)

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