Tax me!
(Crossposted to Mah Rabu.)
In the District of Columbia, the highest income tax bracket begins at $40,000. You read that right: a person making $40,000/year and a person making $40,000,000/year are taxed at the same marginal rate.
Like many states across the country, DC is in a budget crunch this year because the recession leads to both lower tax revenues and higher demand for safety-net services. As a result, DC’s social safety net is at risk. Mayor Vincent Gray’s proposed budget makes the tax brackets ever so slightly more progressive, with an additional 0.4% tax on income above $200,000. This is a trivial increase for high-income earners (millionaires would owe another $3200 per year), and still would not prevent cuts to the safety set, but it is a step in the right direction. Yet some Councilmembers are opposing even this minor tax increase.
Enter the Jewish community. As the Washington Jewish Week reports this week, DC’s Jewish community, led by Jews United For Justice, has been at the forefront of efforts to tell the Council that the people of DC really wouldn’t mind paying higher taxes in exchange for a better city to live in. (91% of people in the affluent Wards 2 and 3 support a tax increase.)
The article also includes an obligatory quote from a (probably Jewish) libertarian representing midat Sedom (“What’s mine is mine”), riddled with factual errors (in addition to what ZT points out in the comments, I don’t think the DC Treasury actually accepts donations — this would run afoul of corruption laws).
Still, most of the Jewish community understands that we all have obligations to our society and to our neighbors. If you live in DC and want to make sure that this perspective wins out, get involved with JUFJ’s efforts.
I think the libertarian made an argument that needs to be addressed: the potentially greater impact made by civil society via donations and nonprofits in contrast to inefficient services offered via the state, paid with taxes.
I’m not against higher taxes; I’m a socialist. But the libertarian challenge has intellectual merit because of the documented weaknesses of the system, esp. in places like DC that haven’t been well run. The left would be strengthened by taking that challenge seriously. How can leverage a campaign for higher taxes with stronger accountability? Since the welfare state is experiencing great weakness right now, are there left wing reforms we can actually win?
@JG, I think you are right that transparency and accountability are important for government. In the case of DC, I don’t think anyone is suggesting inefficiency, corruption, or any other issue of that sort with DC’s homeless shelters, libraries or other services that will be shut down or trimmed back, just insufficient revenue to keep them functioning and current levels. If the issue was corruption, then the solution would be reducing corruption. The problem is actually insufficient funding.
I would be intrigued by a system in which there was a mandatory tithe to social service agencies, the state would approve providers, and taxpayers would allocate their money amongst the options as they saw fit. I don’t think that’s what the libertarian is really suggesting. He seems to be saying let people keep there money who don’t care for the needs of the broader community and rationalizing it with a criticism about government efficiency. I’m curious if Shapiro tithes though I suspect the answer is that he does not.