Debates over taxes are usually framed in binary terms: Should we pay more, or should we pay less? What lawmakers and government officials do with that money is put aside for separate discussions. That's a little odd, since at least some of people's objections to having their wallets lightened are closely linked to concerns that the money will be dedicated to purposes they find immoral, useless, or personally threatening. Pacifists recoil at the knowledge that they're helping to fund occupations and bombardments, free marketeers take offense at being forced to pay for agencies that hamper entrepreneurial activity and damage prosperity, civil libertarians don't appreciate being mugged on behalf of intrusive surveillance efforts and militarized law enforcement…
Would Americans find more peace with the taxes they pay if they could choose where their dollars end up? Over at The Washington Post, David Boaz of the Cato Institute suggests just that.
A new final page of the 1040 form would be created, called 1040-D (for democracy). At the top, the taxpayer would write in his total tax as determined by the 1040 form. Following would be a list of government programs, along with the percentage of the federal budget devoted to each (as proposed by Congress and the president). The taxpayer would then multiply that percentage by his total tax to determine the "amount requested" in order to meet the government's total spending request. (Computerization of tax returns has made this step simple.) The taxpayer would then consider that request and enter the amount he was willing to pay for that program in the final column–the amount requested by the government, or more, or less, down to zero.
Boaz allows that there would still be disagreement over just how detailed the options presented to taxpayers should be. Would the 1040-D break it down into broad categories like "national defense" and "education," or could you select for specific expenditures and programs?
My own preference here might be to direct my money to Yucca Mountain—not to build the long-delayed nuclear waste repository, but to entomb the cash amidst lethal radioactivity, and out of the reach of the likes of Hillary Clinton and Lindsey Graham. Frankly, I think federal officials could turn the National Endowment for the Arts into a homicidal civil rights violation if they put their minds to it.
But Boaz has considered even the likes of yours truly. The real test of whether a say in budget allocation makes Americans more comfortable with the cost of government comes from the next step in Boaz's proposal: "Real budget democracy, of course, means not just that the taxpayers can decide where their money will go but also that they can decide how much of their money the government is entitled to." Taxpayers would have the ability to lower (or raise) the total amount due, in addition to deciding where it goes.
Presumably, a public able to direct tax money to preferred expenditures, and away from disfavored ones, could keep agencies in line by rewarding or punishing them from year to year. Taxpayers then would be happier paying the tab and wouldn't zero out the amount.
Of course, if Americans still chose to starve the beast, that would tell us something, too.
Below, David Boaz gives the lowdown to Reason TV.