Opinion

Make spending discretionary for taxpayers, not politicians

Joseph Gibson Contributor
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Our federal government faces a growing tide of red ink. If we do nothing, we will undoubtedly soon drown in it.

The problem has many facets, but one of them is so-called discretionary spending. In Washington parlance, discretionary spending refers to the annual appropriations bills that Congress passes to fund government agencies as distinguished from “mandatory” spending programs like Social Security, Medicare and Medicaid. Congress is on track to increase discretionary spending again this year while there is hardly any inflation.

Congress has tried various mechanisms (e.g. automatic across the board cuts, pay-as-you-go rules, etc.) to control this spending over the years, but none of them has worked well. The red ink keeps rising regardless of whether Democratic or Republican politicians run Congress.

And that is just the problem. The “discretion” rests in the hands of the politicians—not the taxpayers who are paying for all that spending. The politicians have no incentive to save other people’s money when they can spend it to attract votes.

But what if the discretion rested in the hands of taxpayers instead? Justice Brandeis once referred to the states as the laboratories of democracy, and they have tested the idea of taxpayer discretion.

According to a 2003 survey by the Federation of Tax Administrators, 41 states and the District of Columbia fund some government programs through voluntary contributions made on the state income tax return. The FTA survey indicates that in most cases, taxpayers make these contributions in addition to their tax liability. For example, Virginia’s law allows up to 25 choices (some of which are government programs and some of which are private organizations) on its income tax return. Under the Virginia program, if a program does not receive at least $10,000 for three consecutive years, it is dropped from the program.

Imagine what would happen if the federal taxpayer had that discretion. The tide might start to recede just a little bit. To make it recede even more, let’s add one more element. It is probably too much to ask to allow taxpayers to have this power over all discretionary spending, but we could at least apply it to new spending. No annual increase, no new programs, and no earmarks unless taxpayers voluntarily contribute the money right after they have learned how much they must pay in non-discretionary taxes.

Another great Supreme Court Justice, Oliver Wendell Holmes said “the best test of truth is the power of the thought to get itself accepted in the competition of the market.” One can say much the same for government programs under this kind of system. If the spending is worthwhile, it will attract the money just as hundreds of charities do each year. But if it cannot attract voluntary contributions, then perhaps it is not necessary. Why should taxpayers be compelled to pay for it merely to satisfy the politicians? They should at least have the choice.

No doubt those who favor more and more government spending will raise a host of administrative objections to this idea. However, the federal government has already administered a similar program to fund public financing of presidential campaigns. As noted above, 41 states have had such programs as well.

The details can be resolved. The principle is what matters. We all spend more carefully when we are spending our own money. That is what keeps spending to reasonable levels in normal life. Let’s put the discretion where it belongs—with taxpayers, not politicians. Then maybe, just maybe, we will swim our way out of the red ink.

Joseph Gibson is a former Chief Minority Counsel of the House Judiciary Committee, an attorney at Constantine Cannon, and the author of the new book, “Persuading Congress,” published by TheCapitol.Net. His e-mail is jgibson@Constantinecannon.com.