15 Mar Give Thanks
““The bosom of America is open to receive not only the Opulent and respected Stranger, but the oppressed and persecuted of all Nations and Religions…”
is the editorial/admin staff of Creative Politics, and the pen name used for the original Federalist Papers making the case for the US Constitution in the 1780s. The founders of Creative Politics are a father and son team, both left-handed.
It’s tax season. Which means, as the Tax Foundation will tell you, it’s whatever day in whatever month you’re reading this–it’s always tax season, especially for the millions of small businesses that are the true engine of our economy. But while deficits are a constant topic of political discussion, one of the significant contributors to them, tax evasion, is conspicuous in its absence from the dialog. To be fair, who wants to bring IRS karma onto one’s head? We believe in karma, especially the IRS variety that will fall on you if so ordained, whether you’ve actually done anything wrong or not (let alone what the guy just ahead of you on the fiscal highway did, officer), so we’re not going to call out the non-compliant nor chastise the agency for not collecting from them. But it’s both the elephant and the donkey in the room.
The reality that not even the IRS itself wants to talk about is that our tax system has always been at least somewhat voluntary, dating back to colonial days when houses like ours were built to have all fireplaces merge into one chimney (because the number of chimneys you had was used by tax collectors as an indicator of your wealth). And in an age of armies of one, this is increasingly so. Don’t believe us? Just ask the current occupant of the Oval Office. As of 2010, the IRS estimated that it was losing an average of $458 billion a year due to tax evasion, and this does not include the $32 trillion the International Monetary Fund and others estimate the super-wealthy have hidden away in offshore tax havens. We looked in vain for updated figures from the IRS–for some reason, they’ve apparently decided it’s not a good idea to keep publicizing these numbers.
Not-so-stupid accounting tricks aside, the agency has been hamstrung by two other phenomena. One is the rise in self-employment, both the full-time, often involuntary type as companies increasingly shed the “liabilities” of employees and replace them with contractors (in many cases the same people but without benefits), and the multitude of participants in “the gig economy” who are working 2-3 side jobs to make ends meet. There’s no withholding on self-employed income, which results in nasty accounting surprises at this time of year that our fellow citizens do whatever they feel is neccessary, by any means neccesary, to literally paper over. Beyond this, the more complex forms the self-employed fill out instead of just e-filing a simplified 1040 bring them a lot closer to big boy country where deductions/avoidance are concerned, but usually not as close as they think–ask any IRS agent whether there’s really a “creativity crisis” in our country. Often those who employ contractors forget to file 1099s on what they paid them, most accountants–in the face of the crush of more complex returns they’re dealing with–don’t have time to do more than run whatever the little people give them through TurboTax and check for obvious red flags, and the newly self-employed, in particular, are completely overwhelmed by the 50,000 pages of tax code they’ve just stepped into.
Charybdis for our faithful collectors has been the open hostility towards the agency of the Grover Norquist wing of the Republican Party that until very recently held sway, which has resulted in cuts to the IRS budget of more than 20% since 2010, even as its responsibilities have increased and its working environment has become more complex. The Republican repeal of the individual mandate in the Affordable Care Act, which the agency was saddled with enforcing (without additional funding to do so) promised to provide some relief, but the complexities of the Republican tax cut of 2017, especially with respect to pass-through income, appear to have pulled the football away just before they got a chance to kick us for old times sake. Not to mention that into this environment of fiscal climate change, the government shutdown just dropped a blizzard of 5 million pieces of unsorted mail it’s estimated it will take the government 12-18 months to dig out from.
Thanks to Lois Lerner, the agency can’t really go after anyone where there’s as much as the tax on a $11,400,000 estate’s worth of potential politics involved, bloggers especially(!) included; even a puny (by social media standards) tax rebellion organized in response would overwhelm its increasingly meager and stretched resources. Think a Democratic takeover a scosche more than two years from now is going to reverse this? Suuuuure, the Dems plan to stay in power by increasing the number of tax audits that fall on the heads of their supporters, big and small (ok, since it’s the Democrats, we’ll admit that’s not as improbable as it sounds, but…).
So what is a beleaguered, but noble government agency (endorsed by Jesus Christ himself) endowed with unlimited powers, providing it can keep the power on, to do? Well, let’s go back to the beginning: our tax system is largely voluntary, and increasingly so. When someone gives you something they don’t really have to, what are you supposed to do?
That’s right: thank them.
We understand that right now, as we speak, an IRS compliance officer is reading this in a branch office somewhere in Florida—Tampa, if you must know, feeling like each one of his/her cells has been (spoiler alert) transported to a separate sun to burn for all eternity, or maybe imagining themselves falling into the Seine. But keep reading, pale kings and queens, and hear us out.
Fear and intimidation don’t work, not in the 21st century, probably never as well as you thought they did. Unfortunately, when a CEO who rules by fear like Al Dunlap, Robert Crandall, Jack Welch, Harvey Weinstein, or others on this list flame out or are quietly retired, they aren’t usually hot tickets on the lecture circuit, and even when they are, they don’t tend to share any of the ways they went wrong. Even the poster child for fear-based management, Steve Jobs, is the exception that proves the rule. When he was a tyrant, Apple tanked and he got open-apple-deleted. When he started collaborating with and listening to people (even a little bit), we got the Apple you know today.
And speaking of today–and tomorrow–we can tell you, because we raised them, that shock and awe is really not going to work on the generation behind us (now the largest voting bloc in the country, by the way). They’ve already got that peaceful, easy feeling, they know what freedom really means, and can see the hot, dry day their taxes are saving for. Treating them with respect, on the other hand–let alone as the future the rest of us were put on earth for? Now that might just throw them for a loop. Humility is strength. Gratitude is strength. Humility means being grounded, looking up at others high on the tightrope, being buffeted by every breeze, and wishing for their own sakes that they would fall. Gratitude means acknowledging and appreciating all the people and forces that give you the strength to do better. And if you’re so hard-bitten a revenuer your charges have become too sub-human to think that way, let it also be added that it really is easier to catch arthropods of all kinds with honey than vinegar. So let us be your Cyrano for a bit:
Once again, let’s begin at the beginning, with how you address us.
Really? Is that all we are to you? A source of revenue?
And are you not a taxpayer too, federal repo man?
How about “Dear Fellow Citizen” instead? Better, right? Though still a little cold, so if you have access to detailed data on our political leanings, and we assume you do, you might want to go for some additional personalization, e.g.:
- “Dear Comrade” for lefties
- “Dear Patriot” for wingnuts (yes we know, liberal friends, but whatever works, right?)
- “Dear Valued Customer” for red state Americans
- “Dear Platinum Member,” for those who’ve contributed $100,000 or more/year (we’re pretty sure those who’ve pay $1,000,000 or more already know what their benefits are)
- “Dear Victim,” for those you’ve determined have a particularly black sense of humor
And so on. Don’t address us by our real names, though, no matter how many marketing experts tell you it raises response rates–in this case, those may not be responses you want–let alone by our nicknames, which would definitely send a mixed message. Most of the time the names you know us by are the ones no one who really knows us ever actually calls us anyway.
The Hard Part
Next comes the hard part, so do what your parents told you (you do have parents, right?) and get it over with: tell us how thankful you are. Trust us, like a tough workout, it’s going to hurt so good, and leave you on a high so euphoric you’ll be thinking it’s got to be illegal. But we know it’s going to be challenging for you, so here is a template you can use, free of charge, as long as you don’t audit us for taking it as a deduction:
Thanks so much for your recent tax return. Everyone pays taxes, of course, even the poorest among us, but not everyone takes the time and effort to help us figure out how much of a contribution to the common good they ought to make, let alone actually follow through. We know that you know our tax system is largely voluntary, built on mutual trust, and we appreciate your trust in us. You could have underreported your income, exaggerated or claimed deductions you weren’t entitled to, even hidden your money away where we couldn’t find it, but you didn’t. [we know, we know, but believe us, assuming the best of people, rather than the worst, is surprisingly powerful, and really, what (more) do you have lose?] We’re also aware of how challenging our tax code has become–believe us, those 50,000+ pages cause us plenty of headaches too [it’s ok to be vulnerable–remember how well “I feel your pain” worked for Clinton, before he was caught with the intern under his desk]–and that you’ve expended tremendous time and expense, neither of which you may be able to afford, to get us your information [fun fact, we spend nearly 9 billion hours a year that could be spent growing your pie filling out your forms instead]. In fact, we can say without exaggeration that while it may not involve the same risk of life and limb, we know the sacrifices you’ve made to both report and contribute to the cause of the country we all share are often as daunting as they are for those who serve. You are a true patriot, and [insert your own heartfelt words about how grateful you really are–if stuck, try to imagine what you’d say to someone who just saved your life, or what you’d say to them on reflection].
And that’s it. Not so hard, right? OK then, now comes the fun part, where you get to work hand in glove with us against our common oppressor, and show what you just wrote is more than just empty words.
Breaking It Down
In a survey not too long ago, a representative sample of Americans was asked how much of the federal budget they thought went to foreign aid, and what percent they thought should be spent on it. We, the people, said we thought 20% of our tax dollars were going to help other countries, whereas the amount that ought to be allocated to this purpose was 10%+. The actual amount we spend on foreign aid is less than 1%. where your money went, ideally not just %, but dollars. Still pretty abstract–drill down and get more concrete; you can’t do this for the whole budget, but pick a spot, a different spot for every taxpayer–er, fellow citizen–so they have something to talk about to each other, notes to compare. Ideally pick a spot in the budget that aligns with each individual taxpayers interests, whether you get that via data mining or, much better yet, by asking them and data-mining only if they don’t respond. These letters could quickly lead to revolution when people find out how much of their money is going to things they don’t want and how little is going to what they do, but Thomas Jefferson was right, your fellow citizens may have a lot of hard feelings about you, but they know you’re not the ones who give their money to crony capitalists, and no matter how topsy-turvey things may get, Ben Franklin was right too.
all things should be changed from year to year so there’ always reason to open and read every letter.
save the threat if anything happens to me as a result of writing this to the end.
All Creative Politics blog posts are collaborative, living documents, the way Madison and Hamilton would create them if they were writing The Federalist today. We welcome, nay urge, your feedback in the comment/discussion section below, and will be using it (with credit) to make what you just read more and more real–thanks much for your time and insights; they will go unpunished!