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Did I call it? Great minds…

August 15, 2011

Yesterday I did my bit about how Team Obama has been trying to vilify the Tea Party, and that’s kind of like vilifying smoke. The Tea Party is like the Holy Roman Empire, and is neither Tea nor a Party. (As the HRE was neither Holy, Roman, nor an Empire – I read that someplace once.)

Today Rush Limbaugh spent a lot of time with a similar argument, giving his kind of definition of what the Tea Party is. His was wider than mine, but you know, we both could be right, because as we both pointed out, there is no official Tea Party set of beliefs.  It’s more people who have a common sense of rightness about how the country should be run, but they may completely disagree on the details.

Being a grass roots movement it’s hard to destroy, but it’s also hard to pin down. I just think a lot of people want the government out of their lives, and to be left alone to raise their families and run their businesses.

There’s that group of people – almost half the adult population, apparently – who receive some kind of federal assistance. That includes things like student loans; they’re not all welfare moms or something. They might be of two minds here, wanted their taxes lowered but knowing that they also were in debt to the government, and without some of those taxes they couldn’t get those loans either.

So when a person like that gets into the voting booth, alone, which way do they lean? “I’m being overwhelmed by my taxes and my wife lost her job because her boss at the small business where she worked had to close,” or “I’ll vote for this guy, because I really needed those loans to get through college, and it’s only going to be far more expensive when my kids go.” I don’t write them off, but they aren’t a slam-dunk, either.

One of the things that the folks who press for lower taxes have not done particularly well is demonstrate the “trickle-down” effects of lower taxes. When you talk about lower taxes, people think personal income taxes first. Some might think about capital gains taxes, or maybe about inheritance taxes, or something else specific that might affect them. Rarely do they think about the big picture. People forget that taxes get added to taxes  – businesses have to pay property taxes, income taxes, all sorts of things that get rolled into the cost of goods and services. They have to pay higher salaries for some jobs because of the market, and those salaries are where they are because the individuals need to be able to pay their taxes, too. Everybody talks about moving business overseas because of the cost of workers’ salaries, but the cost of property, utilities, construction, and taxes all could be lower than in the US. If you lower the tax rates we can become more competitive. Perhaps salaries don’t go up – but they don’t need to, because goods and services become more affordable. It’s more likely US businesses buy from US businesses because they can price competitively. Less money flows out of the country.

I’m no economist. I know this wouldn’t happen overnight, although the changes Ronald Reagan made in the 1980s had some pretty quick positive effects, and those effects continued for two decades. It’s also been proven, time and again, that when taxes are lowered, the revenue brought in by the government actually goes up – because the economy gets going, and grows, and even at the lower rates the added GNP adds to the tax revenue. It worked for Reagan, it worked for Bush 43, and it even worked for JFK.

I think a lot of people who can’t articulate their beliefs still know, deep down, that increased taxes are a bad idea. They’ve either been around long enough to see this happen in their lifetimes, or the New Media has made the information available to everyone and more people have heard it.

There will always be people who want to be taxed more. I understand there are people who like to have other painful things done to them, too, but that doesn’t make unfair taxation reasonable for everyone. (I’m not even getting into the whole thing about how the Congress seems to be working against the will of the people a lot lately.) What baffles the media folks, and probably the political pundits as well, is that there’s practically no way to know if the Tea Party membership is 100,000 or 100 million. It’s this uncertainty that makes both parties a little crazy, and why probably even the Republican party in any of its forms doesn’t really want to embrace it. However, if the frontrunner Presidential candidates start saying nice things about the Tea Party, it’s going to be a very interesting election cycle.

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2 comments

  1. Why do you think it is that most Tea Party people do not ever talk about lowering payroll taxes, which affect all working Americans and all American businesses? Instead they just seem obsessed with lowering corporate taxes and personal income taxes even though income taxes are already so low that half of Americans don’t pay them.


    • I’m not sure they don’t…I guess I would have to do a lot more research to get a better feel for that. You are correct, income taxes seem to be the major focus for most people – not just those who have identified themselves as Tea Party members. I call it the “April 15 Effect.” On one day each year we focus on income taxes, whether we pay them on that date or not. Other taxes are, if not hidden, at least not given as much publicity most of the time. People who have their property taxes paid into escrow with their monthly mortgage probably don’t remember how much they pay nearly as much as those who pay it when the bill comes.

      I think there are so many taxes of one kind or another, and the tax code is so complex, that a lot of people tend to turn it off. My wife is a CPA and she has to work like crazy to stay on top of all the changes. Her kind is almost a shaman nowadays – she intercedes with the gods of the tax world on the behalf of regular mortals. There’s just too much to know.

      And your comment goes back to my point, in a way: I think that using the term “Tea Party,” like using “liberal,” or “libertairian,” encompasses a wide range of levels of understanding and intensity of belief. We all like to slot people into nice little categories whether they fit or not.



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