Makers and Marks: I just did my taxes and peeked at the bottom line, which was … zero. It turns out that if you are lazy enough and the market rate in your profession falls quickly enough you can end up with no taxed income at all! Plus when your AGI starts falling suddenly all sorts of deductions and breaks seem to open up to virtually guarantee that you pay no tax. (Suddenly it may be worth it to itemize your deductions, for example, since medical expenses are deductible above a fixed percentage of income–a threshold that quickly approaches zero.)
Will being in the “47%” of non-taxpayers make me more pro-government, as Ari Fleischer and the popular”makers vs. takers” theory suggest? Or is it perfectly compatible with remaining a small-government Republican, as Tim Carney argues? Now that I’ve crossed the line, I’m monitoring my political outlook for subtle changes, in the interest of science.
So far, the main feeling is guilt–guilt that I’ve gotten away with contributing nothing this year, even though I’m actually reasonably well off.** This hardly leads me to expect any kind of government aid–how can I expect anything in return for a contribution of zero? If I paid even a small amount I think I’d feel differently.
One shouldn’t generalize from a single solipsistic anecdote, but I am a blogger and that is my job. The insta-takeaway is this: If people pay no taxes, maybe they don’t become welfare state libs or complacent subsidy-suckers. But if people contribute even a little it’s very easy to expect a lot in return. Our Darwinian minds aren’t good at rationalizing getting something for nothing, but are very good at convincing ourselves that we’re getting the short end of a bargain. It’s analogous to the labor-mixing theory of property (Locke’s, I think)–if you mix just a bit of your money into the government pot, you think you own the whole thing. Maybe you are even happy to be generous with what you think is your money.
If this is true the Romneyesque “47%” argument has it backwards. It’s not the 47% (now actually 43%) who pay no income taxes that conservatives should worry about. It’s the vast mass of voters who pay something in taxes and then happily go to town on Social Security and Medicare. Which may be one reason why the biggest budget-busters are middle class entitlements.
It also means that Reagan’s dictum–that everyone should pay at least a bit and feel some pain–is really a recipe for creating more welfare state liberals. (That doesn’t mean it is wrong, of course.)
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**–Guilt tempered by what seemed like large, though not unfair, tax payments in prior years. Maybe Washington does owe me after all. (My minimum demand: no death panels!) [Edited]