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Giving Meaning To Taxes

Over the last week the media—from blogs to major news outlets—have commiserated with all of us who must complete our tax returns by midnight tonight. They have run commentary and analyses on who pays how much in taxes. They speak of billions and trillions. They mention loop-holes and population quartiles. They lament how complicated the tax structure is. They feature high-profile spokespeople for whom tax season is the perfect opportunity to fan the anti-tax and anti-government flames.

In most of this coverage, Americans are cast as victims. We are taxpayers bearing up under the obligation to pay into federal and state coffers. Some are stoic in the face of the inevitability of “death and taxes,” while others burn with resentment. We dread the task of hauling out that folder of receipts and calculating just how much of our income we have to hand over to Uncle Sam.

All of these stories reflect aspects of tax season reality for Americans. What is missing from this picture is any sense of a larger meaning in the act of paying taxes. Most other things that require effort and sacrifice—family, service, charity, and volunteerism—have virtuous, or at least redeeming, meaning associated with them. That meaning helps us face life’s challenges with a sense of a larger purpose that makes these acts worth the sacrifice.

The stories we tell about tax day reflect a chronic disconnection from our role as citizens; they are devoid of civic meaning. Taxes pay for the things that underpin our public life and connect us to one another through our communities, our states and our country. When we lose sight of this, taxes are seen as merely depriving us of our individual property. If, on the other hand, we see ourselves as stewards of a common good, as citizen managers of public systems and structures that secure the city, state and country we live in, then taxes are our contribution to something important that is bigger than we are.

We all need to be telling a new and meaningful story about tax day that celebrates the concrete opportunity it offers “we the people.”

Part of the answer is to give people ways of understanding what government does. Research conducted for Demos by the FrameWorks Institute and Topos Partnership has highlighted how obscure the role of government is to most people, and making these functions visible and concrete is an important part of a new story about Tax Day. Another aspect of our relationship to taxes is personal—what do I get for my taxes. Some efforts to “rehabilitate” taxes highlight how we each benefit from tax-funded services and programs. There are testimonials from people who attribute their quality of life or their success to public systems and structures. The White House just released a tax-payer receipt calculator that calculates “how and where your tax dollars are spent.”

These are a start toward illustrating a “consumer” understanding of taxes, but they do not fully answer the question “why?” Why do we pay taxes? Self-interested understandings of taxes only take us so far. We need frameworks that illuminate the higher meaning of paying taxes.

The money we pay in taxes supports all of the things we accomplish together that we cannot manage alone. Every day our lives are affected by the thousands of ways in which we band together to secure our safety, security and quality of life. The vast majority of these united efforts we finance and manage through tax-supported public systems at the local, state and national levels. In a country where the public interest is often seen as the mere aggregation of individual interests, the idea of a common good still is an important concept, but one that we rarely lift up.

Tax revenues are civic capital. Publicly-funded enterprises represent a reliable and “scalable” means of addressing many of our common needs and pursuing shared long-term goals. Civic capital is a lynchpin that secures quality of life for future generations.

Massachusetts Governor Deval Patrick has spoken eloquently of the “generational responsibility” that motivated the public investments of our predecessors…

“… [that] built great public institutions and universities and the federal highway system; that created the social safety net we so worry about today; that launched the modern civil rights movement…None of it sprang fully formed from thin air. Each is the result of our parents, grandparents, and great-grandparents asking themselves what they must do in their time to leave things better for the generation to come, and then sacrificing for it. They saw their stake not just in themselves, but in their neighbors; not just in their times but in tomorrow. They bore their generational responsibility. Now, so must we.”

This generational perspective of “civic capital” is what is missing from today’s tax debates. As we send off those tax returns today, let us all try to remember why.

— By Dianne Stewart, Director of Public Works at Demos

References (19)

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April 18, 2011 | Unregistered CommenterDernetz

Dianne and Demos,
Thank you for your excellent, thoughtful piece, "Giving Meaning to Taxes." I agree that we need a makeover of public finance and public perception, and endorse focusing on the "why", and the greater appeal of civic capital, generational responsibility, and public investments.

I would take a page from the other playbook and banish the word taxes, it is old fashioned and too easily taken to task. We should use the above terms, and I might propose another option: raising revenues via a living levy to support, enhance and sustain quality of life for all in our community, state and nation.

How about reform, realignment and restructuring revenues to correspond to today's nimble, globally competitive, real and virtual, service-based, information-based, and just-in-time goods-producing, services-consuming, and information-based mobile, wireless, real and virtual economy?

Every economic actor should generate its fair share slices of living levy revenue in exchange for global peace, national defense, infrastructure investments, our justice system, education, environmental stewardship, disaster relief, and valued public services. Base it on slices of transactions of all kinds, not just real but virtual such as eyeball clicks and mobile downloads, as the Internet and our economy have evolved in step with changing times and tides. Look at the benefits of a value-added living levy.

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