Taxes

Americans Say Government Wastes Half of Every Tax Dollar it Collects

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With Tax Day just a few days away, the latest Reason-Rupe poll finds that Americans think their government wastes fifty cents of every dollar they hand over in taxes. In fact, the middle half of Americans thinks government wastes anywhere from 30 cents to 80 cents of every tax dollar.

This suggests Americans believe the federal government should be able to make do with just half of the money it collects each year. With perceived waste this high, it's less surprising thatonly 17 percent of Americans think their income taxes did more to improve society than had they given that money to charity or invested in private businesses.

Gallup first began asking this question in the late 1970s and early 1980s, finding that Americans generally thought the government wasted about 40 cents of every tax dollar. This number has steadily increased, rising to 46 cents on the dollar in 2002, and then in September 2011,Gallup reported Americans' perception of government waste had exceeded the 50 percent threshold. Reason-Rupe has continued re-asking this question since 2012, finding perceived government waste hit a record of 60 cents of every dollar in September 2013. However, since last fall concerns of government waste have fallen back to 50 cents on the dollar.

Tea party supporters are considerably more likely than their Republican counterparts who don't support the movement to perceive government waste. Tea partiers estimate the government wastes 65 cents of every dollar it collects compared to 55 cents among regular Republicans who don't support the movement. Not only does the average tea partier perceive more waste, their estimates ranged far wider. The middle fifty percent of tea party responses (the interquartile range) range from 50 cents to 95 cents on the dollar. In contrast, the middle fifty percent of regular Republicans ranged from 35 cents to 75 cents.

Independents perceive more government waste (59 cents) than Democrats (47 cents) and slightly more than Republicans (55 cents). Older people (57 cents) were also slightly more likely than younger Americans (50 cents) to perceive waste. Those with higher levels of education are less likely to think the government wastes money but average estimates never drop below 40 cents on the dollar. For instance, those with high school diplomas estimate government wastes 59 cents of every tax dollar compared to 44 cents among those with post-graduate degrees.

While sociodemographic groups vary in their perception of government waste, they each on average think government wastes about half of their tax money, which is considerably higher than 20 years ago. 

* Comparison of subgroups shows averages according to the mean response. Bars represent the interquartile range indicating responses between the 25th and 75th percentile of respondents. 

Nationwide telephone poll conducted March 26-30 2014 interviewed 1003 adults on both mobile (503) and landline (500) phones, with a margin of error +/- 3.6%. Princeton Survey Research Associates International executed the nationwide Reason-Rupe survey. Columns may not add up to 100% due to rounding. Full poll results, detailed tables, and methodology found here. Sign up for notifications of new releases of the Reason-Rupe poll here.

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  1. HEre’s the question that is top on my mind:

    How long do Americans think the Emperor of China’s nose is? We can’t measure it directly, so of course a poll will tell us.

    1. We can measure it directly – but it’s rotted off, so it’s probably limited to the length of the bony structure.

  2. Americans Say Government Wastes Half of Every Tax Dollar it Collects

    The solution to this is obviously to collect 50% more in taxes to make up for the waste.

  3. It’s much worse than that. For ever dollar it takes in, the government does at least $2 in damage to some poor schmuck somewhere. Multiplier!

  4. The other fifty cents? Well-spent.

  5. Americans say this because they have no comprehension of where the money goes. Ask them “How should we get rid of the wasteful 50%?” You know what they’ll say: CUT FOREIGN AID!

  6. Half? That’s that vaunted American optimism on display. I’d put it around 95%.

    1. Based on actual numbers, the government is actually wasting $1.09 of every dollar it takes in.

  7. That graph is perfect illustration of the fact that more education makes people stupid.

  8. The other 50% is used to fill the money hole.

  9. I don’t agree with the framing of this premise. Taxes are stolen money — theft — so 100% of it is “wasted” from my POV. If the people in charge of the government then choose to buy votes by spending some of it on wildly overpriced stuff like roads or bombs or bureaucrats, and some of that hurts me by crowding out my efficient private alternatives or is outright harmful to my well being, such as paying police to pull me over for driving at a safe speed — I’d say that averaging the useful and harmful outcomes together, at best I’d be roughly no better or worse off than if they had used the entireity of the money on hookers and blow and didn’t even pretend to be helping me.

    1. prolefeed,

      I have always wondered who is the final arbiter in an anarchic society. How do they enforce their decisions? Do you need a smaller society for anarchy to work? It seems that it might work in a smaller group, but in a larger group, not so well.

      I assume you are an anarchist because of your “tax is theft” comment.

      1. Not necessarily. I think anything other than a SLT is theft. Taxation is theft is nice shorthand, if not entirely accurate.

        1. I’m curious. Why isn’t an SLT theft? Its the same money, taken from you by the same people, under threat if you don’t pay, right?

          1. IIRC, under SLT you’re free not to pay. You just can’t expect the state to enforce your rights as a property owner if you don’t. So if you’re fine enforcing them yourself, feel free to go it alone.

            1. ahh. that sounds workable. sounds like the ‘T’ needs to be a different letter to though.

      2. I can see anarchy working in a society of one person (as if that would even be a society). But disputes are inevitable as soon as you have two or more people.

        1. There is a lot of middle ground between anarchy and the current system. People can voluntarily contribute to a much smaller system and call it “government.” And do so within the confines of the Declaration and Constitution.

      3. Getting rid of taxation — theft — by itself doesn’t get you to anarchism, just a really small miniarchism. You could still wind up with something like what people briefly enjoyed under the articles of confederation, an almost powerless, perpetually cash-strapped government that could pass all the laws it wanted but had a hell of a time enforcing it because almost no one will voluntarily pay for a government service if they can opt out and go to a private competitor.

        1. No, I learned in public school that the Articles of Confederation were a terrible system, because the government had no central taxing authority.

          No seriously, that was their only argument.

        2. Getting rid of taxation — theft — by itself doesn’t get you to anarchism

          close enough for this anarchist

      4. I have always wondered who is the final arbiter in an anarchic society.

        Tribal elders.

        1. Tribal elders.

          So society would have to be kept small. Also, members of other would have to accept the decisions of the elders, how do you ensure that?

          1. missing word is *tribes*

          2. I think his answer was at least a little facetious.

            Seriously, how do you think disputes are resolved nowadays? Do you go to court over every dispute?

            I’d say over 90% of all disputes are resolved by private action now. Is it really so crazy to think that the remaining ten percent could also be handled via private action?

            1. I think his answer was at least a little facetious

              I get he was being a bit facetious. But he actually makes a good point. As long as the parties agree to abide by the outcome of the decision, most disputes could be handled by “elders.” It is the 5% or so of the really difficult cases where I think you need a final arbiter with the power to back up their decisions. This is what leads me to ask how you handle that portion. Do you go the AofC route with a small, weak miniarchy, or something larger? And how do you pay for it as not everyone will be able to pay individually? I don’t agree with the taxes == theft meme, but I certainly agree some forms of taxes are more unjust than others.

              1. Under the current system, the final arbiter of disputes is “whichever government employee asserts themselves strongly enough to make the others cave”.

                Seriously.

                Take Obamacare.

                Ran into a roadblock in Congress when they didn’t have enough votes to pass the damn thing, so the D leaders reinterpreted the rules for it to be deemed as passed, and the Rs kind of knuckled under to that nonsense, and then when it went to SCOTUS it appears someone in the NSA or wherever had some dirt on Roberts that made him cave and twist the constitution to make it a penaltax, ignoring that the constitution doesn’t allow Congress to tinker with health care at all, full stop, and then Obama found it wasn’t working at all, so he started unilaterally reinterpreting the law, and then taxpayers and businesses started bitching about the mandate and whatnot so that whoever bitched loud enough or bribed enough with campaign contributions got administrative exceptions …

                Final arbiter? Bah.

      5. I have always wondered who is the final arbiter in an anarchic society.

        If you can, in advance, from the top down specify who would be the “final arbiter” or even if there would be such an individual, it wouldn’t BE an anarchic society.

        The whole point of anarchism is that you leave solutions to individual needs or desires to e solved by marketplace of individuals trying a bunch of different solutions via voluntary exchanges, and whatever turns out to work best for the time being is what you have until someone comes up with something better.

        1. For dispute resolution, you arm yourself, or outsource it to a private protection agency, and maybe also hire a dispute resolution agency with a good reputation for fairness and efficiency to handle conflicts between two difference protection agencies.

          It may sound bad to you, but it doesn’t have to be perfect. It just has to be somewhat better than the status quo — being effectively a slave to government officials who are better armed than you and who are doing their level best to completely disarm you.

          1. Exactly. The problem we see today isn’t so much a matter of resolving (minor) disputes – we’ve turned far too many disputes into competitions with clear winners and losers.

            Not only is this the conclusion one can clearly see from the actions of government, our public officials even say it directly more often than they couch their terms.

        2. This is why my answer was not in the least bit facetious.

          If you had an anarchic society, tribes would form immediately. Nobody needs to take my word for it, just analyze various parts of the MidEast. Or even sections of Ukraine for that matter.

          The tribes may decide, quickly or over a long stretch of time, that they would prefer to cooperate rather than have so many (violent) disputes.

          We forget that the percentage of urbanity in the US presently is the highest it has ever been; this used to be a mainly agricultural society which means societies were small. The smallness of the societies didn’t prevent trade between them.

          American history doesn’t begin with the pilgrims, it begins with the native people. Geography influences how societies develop more than any other single factor.

  10. The usual pointless public choice/revealed preference drill.

    Its always the 50% spent on other people that’s wasted. Since what is spent on me is pitifully inadequate, there’s nothing left to cut.

  11. Is lost the same as wasted? And who said it’s wasted? There’s alot of nice houses in Virginia.

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