(Illustration of small white girl in pigtails running. This is Sue.)
See Sue run.
See Sue run to public school.
(Illustration of Sue running towards brick building.)
Go, Sue, go!
See Sue’s Daddy tkae a child-care tax credit.
(Illustation of Sue’s Daddy in foreground filling out some forms while Sue plays with toys on the floor in the background.)
Maybe Daddy will use it to buy Sue more toys!
See Sue use federal student loans to attend college.
(Illustration of Sue, now a teenager in a cap and gown, receiving a high school diploma.)
Good going, Sue!
See Sue lower her taxes with the lifetime learning credit.
(Illustration of Sue putting an envelope into a mailbox. This cartoon is certainly action-packed, isn’t it?)
See Sue get a job.
(Illustration of sue wearing goggles and sawing a piece of wood that’s clamped to two sawhorses.)
See the employer tax exclusion make Sue’s health care cheaper.
See Sue buy a home.
(Illustration of a small house.)
Sue can afford it because of the mortgage deduction!
See Sue have a baby.
(Illustration of a baby’s pacifier.)
See Sue take the child-tax credit.
See Sue save for her kid’s college education with a tax-free education savings account.
(Illustration of Sue, now a bit older, filling out forms.)
Good planning Sue!
See Sue retire.
(Illustration of Sue, now older with white hair, at a retirement party — there are balloons and cake and a man has his arm around her shoulders.)
Now Sue will collect Social Security!
See Sue get sick.
(Illustration of Sue in a patient’s gown at a doctor’s office, being spoken to by someone holding a clipboard.)
Good thing Sue has Medicare!
See Sue join the Tea Party.
(Illustration of Sue, wearing a blazer, angrily speaking.)
SUE: I’ve never taken a cent from the government!
I largely based the above cartoon on this table:
|Percentage of Program Beneficiaries Who Report They “Have Not Used a Government Social Program”|
|Program||“No, Have Not Used a Government Social Program”|
|529 or Coverdell||64.3|
|Home Mortgage Interest Deduction||60.0|
|Hope or Lifetime Learning Tax Credit||59.6|
|Child and Dependent Care Tax Credit||51.7|
|Earned Income Tax Credit||47.1|
|Social Security—Retirement & Survivors||44.1|
|Veterans Benefits (other than G.I. Bill)||41.7|
|Social Security Disability||28.7|
|Supplemental Security Income||28.2|
|Government Subsidized Housing||27.4|
|Source: Suzanne Mettler, “Reconstituting the Submerged State: The Challenge of Social Policy Reform in the Obama Era,” Perspectives on Politics (September 2010): 809. (pdf link)|
From The Baseline Scenario:
Mettler distinguishes between visible federal programs, such as Pell Grants and Social Security, which are administered by government agencies and therefore are more recognizable as government programs, and submerged programs such as the mortgage interest deduction or 529 accounts. She found that the more visible programs a person uses, “the more likely he or she was to agree that government had helped in times of need.” Benefiting from submerged programs, however, had no impact on people’s perception that the government had helped them—even in the case of things like HOPE or Lifetime Learning tax credits, which help people pay for eduction. In fact, “the greater the number of tax breaks an individual had benefited from, the more likely he or she was to disagree that government had provided opportunities for an improved standard of living” (pp. 41–43, emphasis added). (This is after controlling for socio-economic characteristics.)
In short, the way our government currently distributes goodies makes it possible for people to think that they are paragons of individual self-reliance while still being enormous beneficiaries of other people’s tax dollars. That explains a lot about politics today.
I’m contemplating changing the wording of the final panel. Right now, it seems too much like a slam on the Tea Party, whereas what I really want to criticize is broader than just the Tea Party.
UPDATE: Alternative ending.
I don’t think the amount of value is fixed; I think that the surpluses created by economies of scale and network effects are stolen by political actors.
I like your rational-state idea but I’ll point out what might just be an error from linguistic shorthand: if EVERYONE has to get more than they put in, then the existence of the totally nonproductive breaks ‘rationality’, which I don’t think is what you intend.
I’m confused as to what this even means.
How about I don’t use the word “subsidy”, and just say that, in the case of homeowners, the government has decided to help people by taking less money from them than it normally would because it wants more people to buy/be able to buy homes. You don’t consider that “taking a cent from the government,” but do you also disagree that the government is helping certain groups of people? Anyway, because the gov’t is doing that, one of three things happen:
1. Other people pay more in taxes.
2. Other social programs must be cut (which could take the form of reducing deductions for other groups of people, and therefore #1).
3. The deficit grows, which eventually leads to #1.
I believe you said earlier that your taking the deduction doesn’t increase anyone’s taxes; obviously I disagree. Any individual person taking a deduction won’t change tax policy or contribute significantly to the deficit, but the fact that all homeowners can take that deduction will. Is causing other people to pay more taxes basically taking money from the government? To me it seems like it is.
1. You are wrong. It is true that some groups have struck a better deal with the government on the effective rate they pay, but that doesn’t result in them raising the renter’s tax. His rate stays the same, it doesn’t go up when I take the deduction.
2. The government never cuts a single program. Since I have been a tax paying adult, the most they have ever done is reduce the rate of increase in spending on each program.
3. We have deficits, because government promises stuff that we don’t have the revenue for. When a new program is proposed they usually tell us it won’t cause our taxes to go up(ex. Healthcare bill). This was a lie, but they knew if they were honest and said everyone will need to pay more in taxes, the people would not support it.
I would agree with you if we had a flat tax rate for all income levels and groups of people, but we don’t. I definitely agree with you that we all don’t pay enough taxes to cover all the stuff government promises, but a lot of people feel we shouldn’t be doing some of the programs we are currently doing.
Someone posted an article that said more and more people are benefiting from the government programs. This in my opinion is a problem. When you have an increasing number of people depending on government assistance, a less and less people who actually pay into it, in the form of federal income tax, that is an unsustainable. The answer to this problem is not to raise the taxes of those who are already paying, it is to build an economy where others can get to the point where they actually pay into the system. Tax revenues will go up much more if we increase the amount of people paying, than if we just raise taxes on the wealthy.
What the democrats are doing now, with the payroll tax holiday, is wrong. And I am mad at republicans for caving on this issue. This tax cut, or as you would call it, subsidy, is putting $1,000 in the pocket of each tax payer, at the long term expense of our retirement (SS). It is not fixing any of our problems, and is being used as a wedge issue in a election year to essentially buy votes. Funny how when a republican speaks out against the tax holiday, the President and democrats say they want your taxes to go up. So even the democrats must believe it is our money. Why aren’t the democrats saying they are providing us with a subsidy?
The reality with the mortgage tax deduction is that by lowering my tax rate, because I finance a home with a mortgage, the government actually takes in more revenue than it would if I didn’t buy a home, and paid the same rate as the renter. The different industries that benefit from how I spend MY money, creates private sector jobs with individuals who then pay taxes.
That is why the incentive is in the tax code. I look at it as home owners telling the government, we provide a benefit to society by buying a home, and that in turn increases government tax revenue from other sources. So as a result, a home owner should pay a lower taxes, than someone who doesn’t buy a home.
If the renter feels they provide a benefit to society by renting, contact your representatives and negotiate a better deal on your taxes.
Perhaps you need to get out more, Chris.
Critical services are being cut, like state court system budgets, to the point where civil cases are delayed meaningfully and criminal cases are starting to be affected:
Check out, in that article, how a lack of money to buy paper shut down the Morrow County Municipal Court in Mount Gilead, OH. Check out the moratorium on all civil trials in 2009 in Glynn County, GA.
In New Hampshire, court security officers make just above minimum wage, $65/day, no benefits, buy your own uniform and equipment, including weapons. That’s about $8.70/hour. Apart from officers there to testify, these are the only people carrying guns in NH court systems. A person convicted of a crime and doing community service gets paid more per hour than that. They haven’t had a cost-of-living raise, or other raise, in 9 years, which means that in real dollars, their pay has been cut annually.
How about the cuts to the Department of Health and Human Services in New Hampshire?
Now, it took me all of a couple of minutes and a few Google searches to find those examples. What world are you living in?
Try this one:
[edited because grammar]
First of all the examples you state are state level and local level budgets. Those are not fully funded by the Federal Government or my Federal income tax.
As for a google search of budget cuts, government calls lots of things a “cut” when all they are is a reduction in the rate of increase. As for the top two items that come up on a search, one is the FDA cutting a service, that in the article they say will be handled by another agency. Remains to be seen if the current budget proposal will pass.
Over the last 20 years, the federal government has expanded and added more federal programs. The fact that other programs don’t have enough money to operate efficiently, is less a problem of revenue, and more a problem of an ever expanding government, that cannot collect enough money to pay for their new programs. So if you are worried about current programs being cut, and they should be, lots of them, tell your government to stop adding new programs, until we can actually pay for the ones we already have. Regardless of how good the intentions of any federal program, if we do not have the money for it, we should not be doing it.
I would gladly pay more in taxes for new services, if I felt they were worth the cost. But when I don’t agree with the service, or if we can’t afford to pay for a service (Healthcare bill and all its new mandates and regulations), I will speak out against it.
Chris, I’m afraid those are the only three possibilities. If you don’t think program cuts will happen, that’s just a stronger case that deductions raise taxes for other taxpayers.
I don’t think it’s possible to know for sure whether, if
homeowners stopped receiving the deduction, we would take in more or less money, but you can be sure that a lot of that subsidy is wasted because the deduction is not the deciding factor in whether they buy or which house they buy. Similarly, although there’s a child tax credit, I don’t think that the primary motive is to stimulate the economy and I don’t think most people base their childbearing decisions on the deduction.
Basically, I think your assertion that deductions don’t affect revenue is a mere assertion without evidence.
Also, in your response to #1, it sort of sounds like you’re trying to refute the argument that I said I wasn’t making–that is, that an individual deciding to take or not take a deduction doesn’t change the tax policy. It’s the decision to offer a deduction to the group that results in a big enough change in revenue to possibly change policy.
In addition, it doesn’t really matter whether there’s an actual cut to programs or just a reduction to the amount that we want to increase the programs, the result is that the reduction in revenue leads to a reduction in programs, and those programs could be in the form of other deductions.
Actually, I can say for certain more taxes are paid because I buy a house. Here is a simple example:
I buy a home and pay 16K in mortgage interest with 6K in property taxes as a result. So right there I pay 6K in property taxes that I wouldn’t pay if I just rented.
My mortgage deduction and property tax deduction reduce my taxable income by 22K, and at my top tax bracket of 28% that equates to about 6K less federal taxes I paid. So between the two I pay the same amount of taxes, but some of it goes directly to my local government.
However, the 16K in mortgage interest I pay goes to the bank, and some of that goes to pay employees, who pay federal tax on their portion, and maybe some of it becomes profit to the bank, which they also pay taxes to the federal government. So by me purchasing a home, I directly generate more tax revenue to the government than if I didn’t buy the house. That is why they give me the better tax rate, even though I make the same as the renter.
If I didn’t buy the house, I would pay 6K in federal taxes, and have 16K in money to spend on something else. Whether I would have spent it in areas that generated more Federal tax revenue, I can’t say. You might say I provide more value to the federal government than the renter.
But if you rent a house, the owner of that house pays the property tax instead. Fewer renters=fewer landlords buying rental housing.
And you’re still left with other kinds of deductions, like the child tax credit.
The child tax credit is a deduction that can result in an actual subsidy, because even if you lower your tax liability to $0 with other deductions, that credit, along with some others can still be taken. As stated before tax liability after all deductions except child tax credit is $300, and the child tax credit is $1,000. You end up receiving net income from the federal government, that you didn’t earn yourself. The mortgage deduction, no matter how expensive my home will never result in reducing my tax liability to $0.
As for renters, yes their rent goes to help pay the property tax paid by his landlord. And if that group of people want to work a better deal with the government on their effective tax rate, they are free to do it. You might have a problem selling the government on this, because if they gave renters a deduction for the portion of their rent that goes to pay property taxes, the government would be giving the same deduction to 2 separate people for the same expense. That would be like giving the child tax credit to a divorced couple for their child. The don’t do that either. If you are divorced, only one parent can claim the child as a deduction on their taxes.
As far as cuts to programs, our government needs to learn how to live within their means, regardless of how much they want to provide a certain service. There are lots of things I would like for myself that would make my life better, but if I don’t have the money, I cut those activities out. (ie. get rid of cable TV, stop eating out, don’t buy the new car even though my current one is a wreck.) Individuals are constrained by a budget. Exceeding your budget and using credit for some things is fine. But our government debt never gets reduced. Over the past 30 years we have had a few years where government revenues exceeded the expenditures for that year, but we never paid down the actual debt. Even though I disagreed with much of Clinton’s policies, he worked with a Republican congress to have a small surplus for the final years of his Presidency. If that surplus had been used to pay down our actual debt, I would have been fine with that. The problem with government is they see extra money as a reason to spend it on other programs. So I agreed with giving everyone a tax rate reduction, as Bush did. If they aren’t actually going to pay down the debt with my money, I would rather keep it, so they can start new programs that will increase our defict even more.
Love the cartoon!I read aneditorial recetnly in the NYTimes that showed conservative states are more likely to take money from the govt. than liberal states.
Wait a second. Now you’re changing your target. Back in comment #107 you specified that you were talking about Federal taxes. Property taxes are not Federal taxes.
Also, if you think that you wouldn’t be paying the 6K in property taxes as a renter you either think landlords are the most generous folks in the country or you don’t understand how rent is determined.
Seems to me you’ve been arguing from general principles. So, if I understand you correctly, we are now talking specifically and only about the Federal government and Federal income tax? None of your examples would apply to deductions from state income tax, or property taxes, or other revenue streams?
Oh. So state and local taxes do matter in this discussion.
Where are the goal posts here, again?
So you state an absolute:
I demonstrate how you can find a counterexample by showing you a simple preliminary search which produces 9.6 million hits, and your reply is that the first two links don’t fit your criteria?
I’m starting to suspect that I’m feeding something under the bridge, but I’ll try once more within your newly-defined goal area:
I clicked about five links and found the following:
It wasn’t hard.
But, now I’m looking back across some of your other posts in this discussion, and seeing your insistence that everyone must accept your definitions of words, and your insistence that you know better than other people what they believe, and I’m realizing – the cost/benefit ratio on this discussion is pretty high, when I could be doing other things. So, rock on.
Jake, the goalposts in this discussion are not merely on wheels, they are motorized. Also, he gets to put the opposing players where he wants them.
Goal posts aren’t moving, and you don’t have to accept my definition of things. My main point is this cartoon paints a picture that I am somehow subsidized or taking money from the government. Currently in my situation I take no money ever from the government. I have a net tax obligation to “Government”, and it includes all levels. At some point in my life I will be taking out of the system, through SS, medicare (both of which I am paying into right now and seeing no benefit). When the payments I receive from SS and benefits from medicare exceed what I have put into the system during my working life, then and only then can someone say the government is providing me with a subsidy.
My point with the mortgage example was to show, while I get a reduction in my federal taxes, I end up paying those taxes to the local government. My net tax obligation is the same. It would be as if the government didn’t give me the deduction, I would pay them $6K, and they would turn around and send that money straight to my local government for education. The value I provide the overall economy by buying a home, is why I get to pay a lower tax rate. I don’t receive a subsidy from the government.
I would only agree that some of the tax credits in our tax code can become subsidies if you still receive money once your tax obligation is $0. If you need to accept the comic’s premise to somehow feel better about the fact that you pay more in taxes than others with similar income, be my guest. I will never accept that premise. It is not the government’s money until they get it from me, and I only pay them what they require of me in the tax code.
If this is simply a semantic argument, it’s a pretty ridiculous one.
It is obviously possible to define the word “subsidy” in a manner which would would exclude or include anything you want. You appear to be defining “subsidies” as “cash payments from government which exceed one’s total-to-date lifetime tax contributions.” And sure, under that definition you’re not subsidized. Wahoo!
But who gives a hoot what your private definition is? I can define “right to property ownership” as “the person who posts online closest to 1:44 EST on 2/17/12” but if I say I OWN ALL OF CHRIS’S STUFF!! it doesn’t do me any good.
If you start defining your own terms, you cannot communicate with others. Your definition simply isn’t what a subsidy means in common usage.
You all miss the point of the cartoon. No one does it alone and we all have enjoyed the benefits of federal/state/local government policies and programs. We have paved highways, clean air and water, safe foods, a standing military, police and fire protection, free public education from K-12, government subsidized research and development, social security, medicare, etc, etc. The cartoon simply shows the hypocrisy of folks that think they haven’t received the benefits of federal programs and want to cut them. I wonder what program they are willing to give up.
I don’t miss the point of the cartoon, you do. She says at the end, I have never taken a dime from the government. She does not say, I have never received benefits of federal programs. I pay taxes, so I expect certain services. There is a difference between services, and actual money.
The fact that I pay a lower tax rate than someone else, because of the rules of the tax code, does not mean the government is giving me money.
In the cartoon, the assumption is she has paid taxes and all the examples listed, are services provided by the government, which her tax dollars have helped to pay for.
The only block in that cartoon that could make Sue’s final statement wrong, is if her income level was so low, that she actually had a $0 federal tax obligation, and the child tax credit still gave her money.
Our tax laws, as I have said several different ways, allows different groups of people to pay a lower percentage of their income to the federal government, and we all get the benefit of the services they offer. You may not like it, but that is the system we have. I don’t call deductions, credits or any language in the tax code a subsidy, because with that logic, the mere fact that they don’t tax us 100% of our income would be consider the government providing us a subsidy. And by default every single citizen is being subsidized by the government in some way or another.
I will not go frame by frame again and explain how Sue has actually paid into the system, in order to receive the benefits the government provides. Even unemployment insurance is not a subsidy, because if you worked and paid into the system, part of your taxes were paid for unemployment insurance.
My employer subsidizes me, because he pays me money for my labor. I in turn subsidize my government (all levels) with the various taxes I pay. The amount that I give to the government(subsidize them) is defined by our tax code.
But again, you can view your deductions as the government giving your something, but then they are giving everyone something by not taking all our money.
Regarding what we were discussing oh, about 100 comments ago, here’s a version of the cartoon with a non-Tea-Party final panel:
The new version is certainly more robust in that it is harder to define out of existence. I’d rather see her facial expression still be indignantly angry, though. Making her look plaintive in the final frame makes for less punch. Likewise with “Whoops! Poor sue!” as opposed to “Funny Sue!”
Ok, the new version is a more appropriate way to describe the situation. To me it doesn’t imply that Sue hasn’t paid her fair share. I hope I always get to keep paying net taxes to the government and never have to accept money from a social program. That being said, I don’t view SS and medicare the same way I do unemployment, or food stamps. SS for me is my government 401K, it is my savings for the future. Medicare is my health insurance, which I pay my entire working life, but don’t get to collect any benefits until I am a certain age.
I think what Amp really needs, Chris, is concrete guidance from you on exactly how he can make that cartoon perfect. What do you think? How could he kick it up a notch?
Grace, you know I adore you, but how is it worse for Chris to give me feedback than it is for you to give me feedback one comment earlier?
For the record, I LIKE getting feedback, so no worries!
It seems weak now. With the Tea Party punchline, it was partisan and wrong, but it had punch. Now it is a sad little thing.
I have to acknowledge, I’m not sure the “Tea Party” reference in the original version fully reflected all the nuances of that organization, or of the message Amp is trying to send, and I suspect the dissertation committee might have issues with it.
What? This isn’t a dissertation, it’s a political cartoon? Like, a visual depiction that relies on simple, easily-understood, and often exaggerated symbols to convey a social message in a compact form?
Well hell, go back to the original.
Well, Amp, because MY feedback is clearly superior to everyone ELSE’S feedback. Duh.
P.S. Except possibly Robert, but only because he has an unfair advantage, on account of his being ruggedly handsome.
I have to agree, the angry Sue in the last panel seemed to have more punch than the sad Sue. Sue doesn’t have to be an angry tea partier, she could just be resentful of the “accusation” that she gets government help.
Well, Barry’s cartoons get linked for a long time after their initial publication, so I figure part of the reason he wants to take off the tea party label is so that the cartoon stays relevant for all the situations he wants it to, even into the future.
P.S. Except possibly Robert, but only because he has an unfair advantage, on account of his being ruggedly handsome.
My rugged handsomeness IS a major (and unfair) advantage, but is useful mainly in the context of seducing Mythago’s poolboy into sordid unnatural trysts.
In critiquing the visual arts, a field in which I am a self-acknowledged world expert by virtue of having absolutely no talent or experience (and thus, by logical extension, I must be the world’s greatest critic), my unfair advantage comes from my vast general aesthetic superiority.
I don’t think Amp should go back to the Tea Party punchline; a good editorial cartoon makes even people who disagree with its message, think about the messsage. The Tea Party punchline doesn’t make Tea Partiers think about the message, it makes us think “this guy doesn’t get it” (because it’s wrong) and move on. But the general thrust of that punchline was right on.
I *could* write a perfect punchline for Amp which would brilliantly make his intended point and make the cartoon both universally comprehensible, and Pulitzer-worthy. But if I do that for him, he’ll never learn on his own.
I think I originally was the one who suggested a less angry sue, but now that I’ve seen both, I agree – I think that the original drawing worked better. I do, however, like the new text much better, and I think it makes the point a lot clearer and more universally. Well, the caption on top and the, especially, the speech bubble do; “funny sue”, though, I think was better than “poor sue”.
Okay, third try is the charm! I hope. :-p
Robert, can you keep your hands off the poolboy long enough for him to deal with the yellow algae?
Not there yet. Sue knows the government has helped her; she just feels that on net she isn’t getting sufficient ROI.
Here’s a clue. Everybody is wrong. Tea Party types think (mostly wrongly) that they aren’t getting a good deal. Lefty types think (mostly wrongly) that people are paying their own way. The fundamental fact both sides miss is that we are stealing from future generations.
What makes you think I use my hands, Mythago?
Really? I didn’t have that impression.
Jake, that’s a massive oversimplification. I am on my tablet and writing long comments is hard.
I would clarify your statement to say: tea party types feel the government is spending money we don’t have and creating an ever expanding dependency class of people, with fewer people be asked to carry the burden. They feel personal responsibility is being replaced by government programs.
Liberals feel the government should provide craddle to the grave support for everyone, and the gthe wealthy don’t pay their fair share.
I would agree that neither side has it completely correct.
Did you mean to say, Lefty types think (mostly wrong) that some people don’t pay their fair share.
Robert @135: Megan McArdle told me you do.
Well, for Megan I use everything I’ve got. Your poolboy is easier to please.
Chris, sort of, and maybe later I’ll come unpack it.
I really like the third comic, seems very to the point. I would love to see another comic along the lines of taxes lower income individuals pay.
Just like how a lot of government expenses that they benefit from are not that obvious to middle and higher income individuals, the tax burden paid by lower income individuals is also not as obvious as federal tax. And when talking about taxes it’s pointless to look only at federal tax and not your total effective tax burden, the three big examples of these are payroll, sales taxes and user fees. Especially when regressive taxation has become increasingly popular these last few years as states scramble for revenue using sources such as sales taxes, and user fees.
On a related note the mortgage income tax deduction is a massively expensive government subsidy that’s arguably pointless. It cost something like $100,000,000,000 to the federal government in 2010. And it gets attacked by left and right wing groups periodically because it drives up home prices and encourages leveraged investments in housing, which turned out to be not such a great idea. And if you compare Canada and the US home ownership is basically the same without Canada having any sort of mortgage interest deduction so it’s effect on people buying vs renting might not even be relevant when talking about it.
I love it when people try to state what their ideological opposites believe. Their biases always make them fail miserably.
I think I like the third version best. I definitely like the repetition of ‘see’ in ‘see Sue fail to see’.
Robert, whether something is a ‘subsidy’ is not itself the underlying point, but it is important because the way that affects how we make decisions about spending. Call it a “subsidy” and it’s ripe for cutting. If it’s simply a deduction or a write-off or a tax credit, why then, That’s Different.
Cut it all and let God sort it out.
The Washington Post’s Ezra Klein has a post on this subject, in case anyone’s interested. His take is similar to Ampersand’s.
The invisible welfare state of the top 1 percent