Thursday, February 12, 2009

Transparent Taxes

One of the problems with our form of representative democracy is that nearly all of the citizens are effectively disenfranchised at least some of the time.  When the Republicans control the government, Democrats feel that they are not being represented, and vice versa.  Even citizens belonging to the majority party do not necessarily agree with all of their party's platform.  As Lincoln might have said, "You can represent some of the people all of the time, and all of the people some of the time, but you can't represent all of the people all of the time."

The problem is exacerbated when citizens are forced to pay taxes to support programs to which they are opposed.  I may be a pacifist, but my taxes pay for the military.  I may oppose welfare, but my taxes pay for it anyway.  I can urge my representatives to vote against funding programs I dislike, but if I'm in the minority among constituents in my district, they may not act on my wishes, and if they're in the minority in Congress, they may not be able to eliminate programs anyway.  Even if they do, the people who support those programs are not having their wishes represented.

Is there any solution to this problem?  Ideally, since government derives its legitimacy from the consent of the governed, I and all those who agree with me on every issue could form our own government.  In the real world, this has a tendency not to work out very well, as evidenced by the plenitude of civil wars, ethnic cleansing, and "freedom fighters".

I do have ideas about how to make government more representative, but I'll save those for another post.  For now, I have a more modest proposal.  Why not let citizens specify what their taxes should be used for?  We have a very limited form of this now, namely the Presidential Campaign fund, to which I can elect to contribute $1.  


The tax return could instead list a variety of programs, with a box next to each into which I can write the amount of my taxes I wish to contribute to that program.  Thus, if I am concerned about the environment and food safety, I can split my taxes among the EPA, FDA, and USDA.  If I dislike farm subsidies or foreign aid, I can allocate my taxes elsewhere.  If I don't care, I can leave all the items blank and let Congress decide how to spend my taxes.

Corporations likewise could allocate their corporate taxes to programs of concern to them.  If companies are having a hard time finding skilled workers, they can allocate their taxes to education or job training.  If they're concerned about intellectual property protection, they can support the patent office.

What about unglamorous but essential government functions such as dredging shipping channels, running prisons, servicing the national debt, monitoring television broadcasts to make sure no children are traumatized by the sight of a female breast, and paying congressional salaries?  Well, perhaps we find some of them are not so essential after all.  In other cases, perhaps the agencies concerned need to do a better job of educating the public -- in essence, advertising their services.  And Congress would still set tax rates.  If absolutely necessary, they could limit you to only being able to allocate, say, 90% of your taxes, the rest to be spent at Congress's discretion.

Besides making us feel a little better about paying our taxes, this would also serve as a much more accurate gauge of what citizens think our government should be doing.  Which is what government is supposed to be all about, right?

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