One Possible Reason There Are So Few Liberals, Starring Jonathan Chait. And Some Stuff About Tax Progressivity.


About a month ago, New York Times' columnist David Brooks asked "Why aren't there more liberals in America?"

Leaving aside partisan politics, this is an interesting question. The Harris Poll has been surveying Americans on the topic of "political philosophy" since 1968 and the percentage calling themselves liberal had never risen above 20 percent through 2008 (the latest year for which I could find data online).

Part of the reason might be that people who publicly identify themselves as liberal often come across as smug, self-righteous jerks who, even when they swear they are not being patronizing, are in fact being patronizing.

For a recent example, consider New York magazine's Jonathan Chait, who writes:

People often ask, "Why is Jonathan Chait so mean?" It is a fair question, one that…merits a suitably thoughtful reply….

[T]his is why I am forced to be so mean. There are just a lot of people out there exerting significant influence over the political debate who are totally unqualified. The dilemma is especially acute in the political economic field, where wealthy right-wingers have pumped so much money to subsidize the field of pro-rich people polemics that the demand for competent defenders of letting rich people keep as much of their money as possible vastly outstrips the supply. Hence the intellectual marketplace for arguments that we should tax rich people less is glutted with hackery…. A similar problem exists, perhaps to an even worse extent, with climate change denial.

Most people don't follow these issues for a living and have a hard time distinguishing legitimate arguments from garbage. I don't mean this patronizingly: I certainly would have trouble distinguishing valid arguments from nonsense in a technical field I didn't study professionally. But that's why there's a value in signaling that some arguments aren't merely expressing a difference in values or interpretation, but are made by an unqualified hack peddling demonstrable nonsense. Being so mean is a labor of love, I confess, but also one with a purpose.

This sort of thinking is about as convincing as Newt Gingrich's claim that he cheated on his wives out of surfeit of patriotism.

Chait, late of The New Republicis no stranger to these pages, as he semi-regularly spews contempt, anger, exasperation, and Lucy Van Pelt-level psychologizing in Reason's general direction. To the extent that he exemplifies character traits associated with liberals, it's no surprise that self-described liberals are few and far between. That he quickly received an attaboy from economist-cum-insult-comic Paul Krugman only underscores the assocation of liberalism with an off-putting, holier-than-thou mentality. "Actually," wrote Krugman at his Conscience of Liberal blog, "I think [Chait']s not mean enough here; some of the hacks know that they're being hacks, and are putting out deliberate falsehoods." This from the Nobel prize winner who just earlier this year said "I've never gone ad hominem," a demonstrably false assertion that Bloomberg Businessweek has some fun with in this infographic.

The object of Chait's ideological noblesse oblige during this particular blood-sugar spike is Veronique de Rugy, Reason columnist, Mercatus Center economist, and my frequent collaborator. Or, as Chait prefers to call her, that "ubiquitous right-wing misinformation recirculator."

De Rugy had the temerity to cite OECD data suggesting that contrary to the conventional wisdom, the U.S. federal tax system is more progressive than those in most developed countries. What do we mean by "progressive?" Chait defines it as "the degree to which a tax system increases tax rates on higher-income earners."

Which is what de Rugy is talking about. Specifically, the spread in effective tax rates (that is, the progressivity in the system) is greater over here because the U.S. gets most of its revenue from income taxes and because the U.S. gives all sorts of exemptions to lower- and middle-class citizens, many of whom pay no income tax (note: de Rugy is talking about all taxes, including payroll taxes, and not just income taxes). In contrast, the higher marginal income tax rates common to Europe kick in at much lower levels of income, large chunks of the overall revenue is raised via universal consumption taxes such as the V.A.T., and exemptions and refunds common to the American system are minimal.

So the effect is that the spread in effective tax rates in Europe is smaller than in the U.S. For more on this, check out Greg Mankiw's discussion of the OECD data (check the data out here) at the heart of things and Scott Sumner's Money Illusion blog. Sumner, a Bentley College economist, writes that "many American progressives keep insisting that we can get closer to the (egalitarian) European model by making the US tax system more progressive, by having the rich pay more."

Throughout her work on the topic, de Rugy notes that the European system is more regressive and raises more revenue as a percentage of GDP. And she's interested in calling attention to the paradoxes of such a situation. To wit,

Progressive public finance experts like Peter Lindert have shown that most European tax regimes are able to collect more revenue than ours (as a share of gross domestic product, not in total) by having a more regressive—not progressive—tax system.

In other words, European Union governments understand that in order to feed their welfare states, governments must collect taxes from all citizens, including those at the bottom of the income ladder.

At the same time that the U.S. revenue mechanism charges higher rates to the wealthy (that is, is more progressive), however

Government spending here is significantly less progressive than it is in Europe. According to the OECD, European countries devote a significant share of their budget to progressive social transfers.

In the United States, on the other hand, only 14 percent of the budget goes to lower-income Americans. That's because much of the budget is spent on the middle class and better-off members of our society—among other things in the form of Social Security and Medicare payments.

If you can stand the blatant, obvious hackery and ideologizing-uber-alles embedded in such prose, read more here, here, and here.

Over at The Atlantic, Clive Crook, who stresses that he respects Chait, weighs in on the matter thus:

When Chait, with all the authority of a leading light of the intellectual world, says "Rich Americans pay a bigger share of the tax burden because they earn a bigger share of the income, not because the U.S. tax code is more progressive," he is making the same kind of sloppy bias-driven error he falsely accuses de Rugy of making. (I'll refrain from wondering whether he made the mistake deliberately.) According to the OECD, rich Americans bear a bigger share of the tax burden because they earn a bigger share of the income and because the US income tax system is more progressive….

Why, according to the OECD, is the US system so progressive? Not because the rich face unusually high average tax rates, but because middle-income US households face unusually low tax rates–an important point which de Rugy mentions and Chait ignores.

Crook concludes that "on the topic in question, De Rugy is right and Chait is wrong….I'd say he owes de Rugy an apology."

Yeah, well, here's hoping. Indeed, in his latest foray on the subject, Chait brushes aside Crook and writes:

It's possible that, by pairing my critique of de Rugy's error (which I would describe as an extremely elementary error) with a broader disparagement of her credentials, I have made it impossible for her to actually concede error. Or possibly she genuinely does not understand the problem here. I'm not sure. My general experience is that the conservative movement is filled with polemicists who repeat very basic statistical fallacies like this, and seem immune to correction regardless of the level of politeness that correction takes. But, she is an individual and deserves the chance to be judged on her own terms.

What a big, big man with a heart as big as all outdoors. I think that Chait is flatly wrong in his analysis in this situation, but even if that weren't the case, his reflexive belligerence and quickness to cry hack, misinformation recirculator, and what have you—along with his grandiosity and sense of being embattled despite a perch at a high-profile establishment outlet—undermines his persuasiveness. I'm not making a plea for civility here; I'm simply observing that people who comport themselves like Chait make it excrutiatingly hard for anyone to agree with them. Even on the rare occasion when they're right.

Which returns us to the question with which this post starts: "Why aren't there more liberals in America?"

Certainly, there's no shortage of big-spending politicians (Democratic and Republican) who see the federal government as an instrument of social and economic transformation, which accords with one contemporary definition of liberal. But if the Harris numbers are even vaguely right that only about one-fifth of Americans are willing to call themselves liberal and Jon Chait is a liberal, then the question pretty much answers itself, doesn't it?

And suggests the next question: Why are there so many conservatives in America?

Update: De Rugy responds for a last time.