No Taxation Without Representation

Still a great battle cry.

Photo by Farhat Altaf on Unsplash

Tomorrow is Tax Day in the United States. So, let’s talk about taxes. Not how much to pay, but whether to pay at all.

That phrase “No taxation without representation” is a familiar one to any American who stayed awake through Social Studies class in high school. The phrase comes from the American Revolution when the American colonists complained that they were taxed by their British masters without any say in how British affairs were run. Their argument was, “why are we taxed when we have no representation to speak for us in British government?”

That sounds fair, right? If we are going to be taxed, it makes sense that we should have some say in what those taxes pay for. It was a revolutionary idea at the time and formed part of the intellectual scaffolding that the founding fathers of the United States put in place to ensure that the governed had some say in just how they were governed.

Fast forward to today.

Here is a question for my American readers, “How represented do you feel by your current government? (It’s a trick question. I already have the answer). I'm sure many other nations have the same problem, so read along and see if this sounds about how things work where you live.

They don’t, they don’t speak for us.

Over a decade ago, in 2014, Princeton professor Martin Gilens and Northwestern professor Benjamin Page conducted a study that looked at 20 years worth of data on how the average American citizen did or did not influence how they were governed. The paper “Testing theories of American politics: Elites, interest groups, and average citizens,” caused quite a stir at the time, because the authors found that the average American has much less say than they think in government. That was saying something, because the average American already thought the system was rigged against them, they just didn’t know how badly it was. The authors set out to find what real influence the average American has on policy that is enacted through laws in comparison to the “Elites” who enjoy more power and influence of the political process through their wealth and connections to power.

What they found is that the number of American voters for or against any idea has no impact on the likelihood that Congress will make it law. An idea that has zero support - no one wants it - has about the same chance of becoming law as an idea everyone supports. What matters is who supports the legislation. If the average American supports an idea, it matters nearly none. If elites who fund politicians want something done, it generally gets done.

In the words of the authors:

“The preferences of the average American appear to have only a minuscule, near zero, statistically non-significant impact upon public policy.”

Corruption is legal, and encouraged. It is not a bug in the system, it is a quite substantial and well known feature.

In the five years prior to the study, the 200 most politically active companies in the US spent $5.8 billion influencing the US government with lobbying and campaign contributions. What was the return on that investment? Those companies got $4.4 trillion in taxpayer support.

Source: Sunlight Foundation

That is a return on investment of 750 times. Corruption tends to be quite lucrative - whether it is legal or not. But if it is legal, there is no worry that you will get caught. Just some pesky reputational damage. But that is what PR firms are for, right?

Tax us not at all or give us a real say.

So here’s a novel idea. Tax on results. Based on the most recent data available in 2021, the top 10% of income earners in the United States paid about 76% of income taxes. But based on the results we saw above, maybe they should be paying all of it.

If the bottom 90% of us have effectively no representation, then we shouldn’t be paying any taxes. That, or make legalized corruption illegal in America and give the 90% real representation.

The current path is unsustainable. The 90% of Americans can only be disenfranchised for so long. Things will get progressively worse, and at some point, the 90% will have had enough. History has played out this story many times before. In the end inequality and corruption lead to revolution and violence.

Here is a free piece of advice to American policymakers. Either 1). only tax the top 10% because the laws are only written to benefit them, 2). give people real representation and actually make corruption illegal, or 3). Make guillotines great again.