Beyond Tax Demagoguery

A review of 10 Excellent Reasons Not to Hate Taxes.
Edited by Stephanie Greenwood. The New Press, 2007. 156 pp.

March 24, 2008

People who worry about massive concentrations of private wealth have, down through the years, endeavored to do something about those concentrations. They’ve worked to tax the rich. The defenders of the rich, in response, have worked to demonize taxes. Over the last three decades, in the United States, these champions of privilege have succeeded beyond their wildest imaginations.

Taxes in contemporary America “have come to be regarded,” notes this slim but important new book, “as a drain on productive activity that distorts incentives and supports a wasteful government bureaucracy.”

Amid this anti-tax climate, America’s wealthy have been doing quite well. They have, in just a generation’s time, more than doubled their share of the nation’s wealth.

In 10 Excellent Reasons Not to Hate Taxes, a broad array of academics and activists take on head-on the assumptions that have congealed into America’s conventional anti-tax political wisdom. They blow away, in one succinct chapter after another, the top canards of the anti-taxers: that America is “overtaxed,” for instance, or that taxes torpedo growth.

In truth, observes Jeff Madrick, the U.S. economy has grown at its fastest when taxes — on the rich — have been at their highest. In the high-growth 1950s and 1960s, the top marginal tax rate on income over $400,000 ”hovered at approximately 91 percent.”

But the contributors to 10 Excellent Reasons go beyond economic statistics. They challenge the “libertarian rhetoric that describes taxes as a form of theft,” deftly exposing this rhetoric, in economist Nancy Folbre's words, as “a form of individualism that denies our obligations to others.”

“Taxes shouldn't be thought of as an abstraction that can be described by demagogic sound bites,” sum up entrepreneur John Abrams and Greg LeRoy of Good Jobs First. “They are what we use to build strong, stable prosperous communities.”

The book’s ultimate lesson? In nations that let wealth concentrate, untaxed, these strong, stable communities never get built.

— Sam Pizzigati

Sam Pizzigati edits Too Much, the weekly online newsletter on excess and inequality.