Taxing Situation

I have been reading a history of early British America — America before the revolution. It is intriguing. The Americans were a recalcitrant people who really didn’t want to cooperate with the British in protecting their own frontier. Further, they were a bit of a burden to the British who spent hundreds of thousands of pounds over seven years protecting that frontier against the French and Indians in the New World. It was costing the British about £350,000 a year to maintain their army in America even after the war.

Of course, the British had been fighting the French for centuries so that was nothing new. But the fact that they had to protect fiercely independent colonists across the pond against an ancient foe and their new allies was not something they welcomed. And the fact that it cost thousands of pounds and placed the Mother country in debt up to her ears created tensions between Britain and its New World colonies. The solution proposed by Lord of the Treasury George Grenville was to tax the colonists and recoup some of the losses.

The initial tax in 1733 (in the form of a “duty”) was on molasses that came from the West Indies and was used by New Englanders to make rum. The tax was generally ineffective and simply encouraged smuggling in the colonies. But when the sugar tax was levied in 1763, and actively enforced, it began to bring the disparate colonies together as one and to create strong resistance that eventually led to the Revolution. Until I read this book I was unaware of how independent each of the colonies was from the others and yet how the people in the distinct colonies all felt themselves to be British citizens — and therefore privileged above the rest of the world — but not the least bit beholden to the Mother Country for protecting them against enemies. But it was taxation that brought them together and actually helped to create some sense of unity out of the diverse — and very different — American colonies (think: Massachusetts and Virginia who were worlds apart in so many ways and never really got on the same page).

Taxation, especially the Stamp Act, got the colonists all riled up; it was something to be avoided like the plague. That has never changed. We still lump taxes together with death as the two things we fear most and neither of which can be avoided. And it is that attitude that has given birth to the Tea Party and its insistence that there be no more taxes — in the spirit of the early colonists about whom I dare say most Tea Partiers know very little, if anything at all.

The problem is that there is another side to the issue: taxes are essential for the running of the individual states and the country itself whether we like it or not. And as noted by one of my favorite blog-buddies, our country is taxed at a lower rate than almost every other developed country in the world yet we complain the loudest. Perhaps this is part of our inheritance (as noted above, we have a long tradition of complaining about taxes), but it is unseemly and also unworldly. Taxes are essential to the well-being of each and every one of us. As noted by another of my favorite bloggers, our tax money does immense good. Not only are taxes necessary to maintain a strong defense against terrorism (a point that is accepted by almost all) but they are also necessary to maintain social programs that benefit those who are most in need and ultimately make us a stronger nation (a point that is rejected by many).

To be sure there are abuses, as critics are quick to point out. They know — or have heard about — a fellow who takes his student loans and buys himself a new car, or, perhaps, $15,000 worth of weapons that are later used in a shooting in a movie theater. These things certainly happen. But this money also makes it possible for people in need to keep their collective heads above water, to buy food, clothing, and shelter for their struggling families. And we must never forget that. Instead of focusing on the abuses and the waste we can all attest to, let’s instead focus on the immense good that our taxes do to not only those in real need but all of us who benefit from health care and better schools for our children. After all, we are supposed to be a charitable people. We need to alter our mind-set and start to think of taxation not in conjunction with death, but with life itself.

Change

I don’t pay much attention to polls. I especially tend to ignore pre-election polls. But a recent poll regarding the incumbent President’s chances to win in November and the “fact” that single women may win him the White House, while it suggests that single women may be the smartest segment of the voting public, raises some interesting issues that have nothing to do with polls. A recent story tells us that

In 2008, Republican Senator John McCain beat Obama 52%-47% among married voters, according to exit polls, while the Democrat [Obama} thumped him 65%-33% among unmarried people. That suggests that Obama has lost ground among married voters and unmarried voters alike. A drop would hardly be a surprise: Americans are unhappy about the sour economy three and a half years after the president took office vowing to fix it.

To begin with, Obama is being hoist by his own petard, having embraced the notion of “change” in his candidacy four years ago. He was going to be the President of Change and turn things around. Every political candidate promises this, of course. But he made it the focal point of his campaign. Big Mistake. The remarkable thing is that we still believe these people — after repeated failures to deliver on campaign promises. Further, Americans want what they want when they want it. We are an impatient people and if we grant the President three years to turn the economy around and he hasn’t done it we want someone else in there who will.

The problem is, of course, Obama was trying to get things done with a Republican Congress that refused to cooperate at every turn. He used up all his chips on health care, and he didn’t have many to begin with. We are now so deeply entrenched in party politics and there isn’t a man or woman alive who could effect meaningful change trying to work with people who are ideologically opposed to them in the Congress. It is naive to suppose that even if this man did everything he could to turn the economy around he could have done it alone. It’s not clear that a Republican President could have done it. The economy is in the toilet and no one seems to know what the magic formula is to pull it out (though I would suggest cuts in “defense,” increasing taxes on the wealthy, closing corporate loop-holes, shifting tax subsidies from Big Oil to clean energy thereby creating more jobs and helping to save the planet — for a start. But what do I know?).

Political promises are made to be broken. We simply should accept that fact going in. Furthermore, change takes time — years in the case of complex problems that have no simple solutions and where the infamous 1% seem to be in charge. This group as we know includes many members of Congress and as a whole they don’t really want radical change: they are doing just fine with things as they are, thank you very much.  Change may indeed come. But it will be very slow in coming and it may not be for the better.

Ironic Footnotes

You may have seen the graph that shows the parallels between what is referred to as “Obamacare” and “Romneycare.” It has been making the rounds of Facebook of late.

The irony is, of course, that Mitt Romney as Republican candidate for President will be forced to argue against the very plan he supported while Governor of Massachusetts. This is only one of at least two ironies that have come on the heels of the recent Supreme Court decision supporting the  Affordable Care Act. The other has to do with the fact that Barack Obama, while Senator from Illinois, stood on the Senate floor and spoke against John Robert’s nomination for the Supreme Court, pointing out that Roberts was on record questioning “whether the Commerce Clause empowers Congress to speak on those issues of broad national concern that may be only tangentially related to what is easily defined as interstate commerce.” That is to say, the so-called “commerce clause,” has been employed in the past to push forward legislation on the grounds that these laws involve more than one state and were therefore under the purview of the national government. This has been the grounds for many fundamental socially progressive acts of legislation in the past and has proven to be a way around the objections of “states’ rights” advocates who are still fighting the Civil War.

The recent decision on the Affordable Care Act was based, as I said in a recent blog, on the grounds that the law was allowable as a form of tax, thereby rejecting the government’s plea that it be allowed on the grounds of the familiar commerce clause. The irony was that it was John Roberts who substituted the rationale in his vote supporting the law and made the government’s case for the Affordable Care Act himself. Thus, the man whom Obama opposed on the Senate floor handed the sitting President his greatest triumph so far in his first term as President.

But, as I also mentioned in the previous blog, the victory may have been merely Pyrrhic since this Court’s decision to reject the commerce clause rationale will almost certainly handcuff the Congress in the future and make it far less effective in pushing through regulatory legislation — thereby simultaneously giving the Court itself extraordinary legislative power. It will be interesting to see how it all plays out in the future. In the meantime, we can be pleased that more Americans will have affordable health care while at the same time we keep a wary eye on the future machinations of the Supreme Court.

 

[Update 7/6/2012: Louisiana Governor Bobby Jindal, , a possible candidate for Vice President and one who has sworn not to uphold the Affordable Care Act, recently said the following in ragging on the plan: “There’s only one candidate — Gov. Romney — who’s committed that he will repeal the Obamney — the Obamacare tax increase,” Jindal said. “He will repeal Obamacare as soon as he’s elected.”  “Obamney Care.” Indeed. Is there any doubt?? Freud would have delighted at the slip of the tongue!]