-- Posted by Neil H. Buchanan
In a recent post, I referred to my series of posts from late Summer 2007 in which I identified the worst examples then afoot of "dishonest tax rhetoric." I singled out misleading methods of describing tax increases as the "largest ever," the games one can play to make sales tax rates seem smaller, and finished with the infamous death tax/estate tax ploy. In each of those cases, I described what was going on as dishonest because the purveyors of the rhetorical ploys were building on some element of truth in each case but were deliberately communicating utterly false conclusions.
For example, if one describes a tax increase as large or small by measuring it in dollar terms, then a $100 tax increase in a $10 trillion economy is "larger" than a $10 tax increase in a $100 economy. The reason for the false comparison is to mislead the unwary into thinking that the current tax increase is somehow unprecedented, dangerous, and venal. There might be reasons to oppose any particular tax change, but such false comparisons are clearly dishonest.
Another false comparison has resurfaced recently; and although it also qualifies as dishonest in the sense that I am using the term here, it is so qualitatively disgusting that it hardly deserves to be described in the same terms as these other, more pedestrian, rhetorical shell games.
Several years ago, Harper's included a transcript of an NPR interview in which Terry Gross was discussing the estate tax with the anti-tax activist Grover Norquist. (I am recounting this from memory.) Gross pointed out that the tax at that point affected only 2% of all estates, and Norquist casually suggested that targeting a small minority of people for harsh treatment was morally equivalent to the Holocaust. Gross, obviously incredulous, pressed the issue, giving Norquist every opportunity to say that he had misspoken. Surely, Gross offered generously, you cannot possibly be suggesting that taxing large estates at average rates of roughly fifty percent is the same as killing six million people because of their religious identity. Norquist was unfazed, insisting that this was exactly what he meant to say, because in both cases a majority was targeting an unfavored minority for harm.
I had stored that shocking exchange in the back of my memory files, thinking it an especially amazing example of how provocative Norquist was willing to be. Early in 2009, I started to see some references to this analogy in the hand-written signs at the anti-Obama rallies, but I still thought that this was limited to the most extreme crazies. A few weeks ago, however, "The Daily Show with Jon Stewart" showed clips of Laura Ingraham of Fox News invoking the famous poem: "First they came ..." Her point was Norquist's point, extended from the estate tax to progressive taxation more generally. That is, she argued unambiguously that "going after" a rich minority to pay higher taxes is morally equivalent to "going after" a religious minority for extermination.
As Stewart pointed out, the phrase "they came" in the famous poem refers to taking people away and killing them, whereas the worst that can be said about progressive taxation is that "they came" to collect more taxes from a rich person than from a poor person.
Beyond that rather important difference, it is also notable that American politics is hardly an unfriendly place for wealthy people. One can buy office if one has enough money (sometimes even three times -- in a city where mayors are limited to two terms), and virtually every aspect of the U.S. legislative process is awash in money. The idea that America's rich are somehow defenseless against the whims of the unwashed masses is beyond laughable.
Even setting aside the disgusting analogy between killing people and taxing people, however, the comparison is beyond dishonest. Progressive taxes do not turn rich people into non-rich people. For example, if the estate tax returns in 2011 in the form that it existed in 2001 (which is the current default), the effective tax rate on estates would pass 50% when the taxable estate (ignoring planning opportunities) reaches about $14 million (approaching a maximum rate of 55%). This means that the heirs to a $14 million fortune would receive at least $7 million that they did not earn. If, as the House health bill proposes, we raised tax rates on high-income people by roughly 4%, then a person whose taxable income rises from $300,000 to $310,000 would have roughly four hundred fewer dollars than if the bill had never passed.
But isn't the worry that we will not stop at the $300,000/year earners? That, in fact, is the larger point: The slippery slope is reversible. If "they come" for the rich, and then "they come" for the almost-rich, and then "they come" for the merely comfortable, etc., those people will still exist and will still be able to vote. Voters in lower income categories who see "them coming" will be able to stop the process, if the benefits of higher taxes are less than the costs. No matter what, the richest will still be the richest, even after taxes.
Our political system has many flaws, but failing to listen to anti-tax sentiment among the people is not one of them. Progressive taxation is not irreversible. Analogies to genocide are appalling. They also make no sense, even on their own terms.