Starting from Scratch: How Would a New America Solve the Tax Problem?

The brewing battle between Senator Paul Ryan and President Obama serves as a tragic reminder of just how impossible it is in this country, at least lately, to pass a responsible plan for controlling government costs. Sometimes we are precisely nowhere.

I’ve come to the conclusion that the tax dilemma — convincing people that to keep the government services they want, they need to consent to some form of responsible taxation — presents a simply intractable problem in a sufficiently polarized political climate, especially where (as here) one of the most powerful lobbyists on the issue has, as his stated goal, passing irresponsibly low taxes for the specific purpose of forcing a fiscal crisis he can leverage to trim programs he dislikes. Our leaders should be above such cynical manipulation, and our citizens smart enough to detect it. But they’re not.

Which raises the question for me of, what can we do eliminate this kind of tax gamesmanship?

Probably nothing. Grover Norquist and his allies have basically checkmated democracy. But we could solve this problem if we took it back to square one, and redesigned the entire budgeting process to solve these problems in advance. Imagine a new constitutional convention, where the re-founders assemble to deploy all of their political engineering talents to intelligently solve not just the problem of tyranny, but the many, many problems democracy has managed to invent over the years. How would they do it? A suggestion:

  • Provide for nonpartisan, yearly assessment of government costs: imagine a constitutionalized Office of Management and Budget, and charge them with generating, by the close of each fiscal year, an estimate of what amount of funds the government must raise to cover costs (and pay down any such deficits as may arise). This office shall be required to submit its figures to the President, and the Congress, before the first of each fiscal year.
  • Constitutionally require the Congress to raise that amount of money over the course of the next year: this is self-explanatory, but the text would run something like, “Congress shall enact legislation necessary to raise” all funds necessary to meet OMB’s estimate. This provision would also make clear that it provides no new source of congressional power and that, in assessing compliance with the requirement, all sources of revenue may be considered.
  • Provide penalties to ensure compliance: we should not assume that Congress will play by any rules, especially in a fractious environment. That’s what got us into this mess in the first place. So, the rules should provide for either (1) a mutually unpalatable alternative tax, automatically enacted if Congress fails to guarantee funding by a certain date; or (2) authority for some unitary actor to make decisions in the case of Congressional gridlock (the President?).
  • Account for the effects of progressive taxation: this is really a sub-point on the last issue. The alternative tax option could be, for example, an automatic proportional escalation across all tax brackets, so the automatic increase would build on, rather than supplant, previously democratically agreed-upon tax brackets.
  • Allow Congress to set an alternative minimum funding bar: it’s probably impossible for any OMB-like creation to correctly account for future legislative priorities — or for overwhelming, structural deficits. So, Congress (or maybe the President?) should be allowed to supersede OMB’s recommendation of the minimum income required.
  • Consider judicial solutions: as an additional enforcement mechanism, the system could provide for taxpayer standing to challenge Congressional inaction, and vest original jurisdiction in the U.S. Supreme Court to resolve any such controversies, and proscribe remedies.

Arguably, this is a radical solution. But the entire history of American democracy is the history of experimentation with political systems, often with great success. It doesn’t hurt to remember that it’s ultimately our job to come up with solutions for our problems.

We Were Promised Jetpacks, “Act on Impulse


  1. didionsdaddy · ·

    When you led with “penalties to ensure compliance” I was hoping for penalties on the Congressmen themselves.

    1. Yeah. They all lose their seats and lifetime eligibility for all elected office if they miss the deadline, something like that.

      1. didionsdaddy · ·

        That is what would happen to me at work if I repeatedly failed to perform my job.

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