by Rev. Kathleen McTigue, April 13, 2003
I hope it won't seem to be cruel and unusual punishment to devote a sermon to the topic of paying taxes, two short days before all our tax forms are due. The timing was of course very deliberate, since April 15 is a day most of us are forced to think about taxes.
But maybe we'd be willing to consider the topic more often, or in greater depth, if we took seriously a statement once made by Sheldon Cohen, former IRS commissioner. He said, "People think taxation is a terribly mundane subject. But what makes it fascinating is that taxation, in reality, is life. If you know the position a person takes on taxes, you can tell their whole philosophy. The tax code, once you get to know it, embodies all the essence of life: greed, politics, power, goodness, charity. Everything's in there."
Broad though that statement is, I'm not sure it's an exaggeration. There is very little that is more reflective of our values, our fears, our prejudices and our ethical grounding than the ways in which we spend our wealth. That's as true for us as a society as it is for us as individuals. So it's important to think about taxes -- both how we pay them and how they are spent -- because it's through our taxes that most dimensions of our society are run: schools and libraries and parks, roads and traffic lights and highways, post offices and police and fire departments, social services of every kind, the military, and enforcement of the regulations meant to keep our water and air and earth livable -- to name only the most critical things our taxes pay for.
If it seems that I'm stating the obvious here, I'm doing it because the tax policies of this country are on a trajectory that ignores the obvious. We're bound together as a society by all the things that link us into one public sphere. We're bound there by many things, but without the steady flow of support through our taxes, there would be no way at all to sustain that public sphere for even a day.
As Oliver Wendell Holmes put it over a century ago, "Taxes are the price we pay for civilization." You'd be hard-pressed to find that realization in any of the language or arguments of those who favor massive tax cuts. Instead, there is a tone of aggrieved outrage, along with the message that on some level, all taxes are unfair: it's your money, you earned it, you're entitled to all of it. It should matter to us, urgently, that those who promote this attitude have won, and are continuing to win, tax cuts that will have a drastic impact on the entire fabric of this society.
Two years ago Congress enacted an enormous tax cut that had been heavily lobbied for by President Bush. The overall tax bill came with a ten-year price tag of $1.35 trillion, with its benefits falling overwhelmingly to the wealthy. A centerpiece is the gradual reduction and eventual elimination of the estate tax, cleverly re-named the "death tax" in order to increase public support for its repeal, even though only a small part of the population is subject to it.
The huge tax cut was justified, at the time, as a stimulus for the economy so we could avoid recession; the rosy projections included economic surpluses in the trillions. Fast forward to 2002. The surplus is history, of course. With the spending bill just passed to pay for the war in Iraq, it now appears that this year alone our deficit will be about $400 billion. Higher deficits than we have ever before carried as a nation are now projected for as long as the next ten years. On the state level, most of our fifty states have faced fiscal crises, due in part to economic downturn and in part to the loss of revenue from the 2001 tax cuts.
In the face of these deficits, in the face of an undeniable recession, in the face of an active war in Iraq and the prospect of further war with Syria or Iran -- not to mention rebuilding for which we're now morally obligated, in Afghanistan as well as Iraq -- in the face of fiscal crises in most of our fifty states and the bottom falling out of the ragged safety net we still like to think we provide for the neediest among us -- in the face of all of this, it has surely not escaped your notice that Congress has just passed another massive tax cut.
Last week, after a brief debate that was almost entirely eclipsed by the war in Iraq, both houses of Congress passed the cut. This time, 60% of the tax benefits will go to the top 10% of the wage earners; the average tax payer will get less than $300 out of the deal, and millionaires will average $30,000. Meanwhile, there will be over $265 billion in cuts to balance the loss of revenue. Here's an irony at a time of war: two-thirds will come from social programs, including $14.5 billion that will be cut from veterans benefits.
Now, if you are anything like me, in hearing these facts and figures, numbers and percentages, you've already started to tune out. It's hard to hold onto this stuff, hard to process it and even harder to keep it in our minds long enough to draw some conclusions and figure out what to do. But it's important that we think about it because every one of us will come to feel the damage that is already being done to our social fabric.
One way to think about it is through a religious perspective, because odd though it may seem, the questions that lie at the bottom of the tax debate are religious and ethical questions. Sheldon Cohen is right -- everything really is in the tax code. Questions like: What constitutes right relationship? How much do we owe to one another and to the common good? When it comes to profits, how much is enough?
The reading I took from Leviticus makes clear that these sorts of questions have worried people for a very long time. Those scriptures are not something we consult very often, and much that they hold would seem irrelevant to us. But that little snippet of what was really a tax code, over three millennia old, seems to me surprisingly relevant to our own struggles for clarity.
Similar instructions are scattered through other parts of the Torah. In Deuteronomy one section teaches, "Every third year you shall bring out the full tithe of your yield of that year, but leave it within your settlements. Then the Levite, who has no hereditary portion as you have, and the stranger, the fatherless, and the widow in your settlements shall come and eat their fill…If there is a needy person among you,…do not harden your heart and shut your hand against your needy kinsman. Rather, you must open your hand and lend him sufficient for whatever he needs…Give to him readily and have no regrets when you do so."
A couple of weeks ago I spoke with my colleague and neighbor Rabbi Herb Brockman, who has given a lot of thought to these passages. One of the things he said was especially enlightening. He explained that these laws that made it mandatory to leave the edges of the field unharvested for those who were poor and landless were not considered laws of charity. They were instead a recognition that not all of the wealth that grew in your field was yours: some of it belonged to those members of the society who were landless.
It belonged to them for two reasons: because the source of your wealth was the land, which in fact belonged to God, not to you; and because these poor who took the gleanings were equally members of the society, despite being in poverty. Therefore, said Herb, as the landowner you were not even permitted to harvest the grain and then give it to the poor, because this implied that it was yours to give. You left it there because it did not belong to you; to harvest it would be tantamount to stealing.
In the book from which I drew our other reading, Joseph Singer agrees, when he writes that these gleanings at the edges of the field "are owned by the widow, the orphan, the stranger and the poor -- those who have no access to land of their own or whose family ties have been shattered. They are not a matter of charity and they do not constitute a transfer from the landowner to the dispossessed. Rather, they are the share of God's bounty belonging to the landless."
For all its distance from us in time and culture, the ancient Jewish code still evokes echoes for us, because we are still a people who need to struggle with the questions raised by wealth and poverty. Central to some resolution of those questions is the ability to recognize and admit that whatever the wealth we might possess, it would never be accurate to claim that it belongs only to us, and that society has no claim to a portion of it.
In even the most dramatic stories of rags to riches, pluck and courage and hard work are not the only things that lead to fortune. Also needed by the proverbial 'self-made man' are luck and the right circumstances, skills that society chooses to reward, often the right gender and the right color of skin. Also needed are the other people whose work or inventions laid the groundwork for his, or whose labor makes his factory run. Also needed are the institutions from which he gained his education, and if it is a rags to riches story, those institutions are public ones. Also needed is the nearly invisible system of supports that protects property rights, maintains roads and electrical systems, regulate markets and so on.
And of course, far more common than the rags to riches stories are the inheritance stories. On the Forbes list of the richest 400 Americans, nearly a third were born onto the list; another quarter were born close enough to it to say that they started life with a fortune. It is this inherited wealth, and the similar wealth of other Americans fortunate enough to be born into money, that is largely at issue in the tax cut of two years ago and the efforts still underway to make the cut permanent. Many of these wealthiest among us are involved in intensive lobbying to continue reducing the share of their fortune that will go to support our commonwealth.
It can be instructive to learn what it is these same people are happy to receive from the commonwealth. In his recent book about why he supports taxes especially on inherited fortunes, Bill Gates Sr. investigated a rancher named Lynn Cornwell. You might remember that Cornwell and many others, including President Bush, claimed that repeal of the inheritance tax was urgently needed in order to save family farms.
To dramatize this, Cornwell delivered one version of the bill on a tractor. Gates discovered that no one, in any state of the union, was able to actually name a family whose farm had had to be liquidated because of estate taxes. Gates also discovered that Lynn Cornwell, who argued so piteously against the tax, received well over $100,000 every year in direct cash farm subsidies. He also received the annual indirect public subsidy of grazing his cattle on federal lands. Gates points out dryly that by this time, the American taxpayer is an equity partner in the Cornwell Ranch and ought to see some of the dividends when the ranch transfers to the next generation.
Not all of the wealthy believe they're entitled to hold on to whatever they can get. Warren Buffet is one who seems to have a broader understanding of where his wealth actually comes from and what it means to support the commonwealth that in turn supports him. In writing about the hundreds of millions of dollars his company paid in taxes, Buffet said, "I have absolutely no complaints about these taxes. We work in a market-based economy that rewards our efforts far more bountifully than it does the efforts of others whose output is of equal or greater benefit to society. Taxation should, and does, partially redress this inequality."
The inequality is glaring when we look back on the boom years of the 1990s. Despite the creation of hundreds and perhaps thousands of new millionaires, most people's wages were flat through the decade. The median wage in 2000, when it's adjusted for inflation, was less than it was in 1973 when Richard Nixon was president. So most Americans were treading water or sinking, while the rich were climbing onto speedboats: the wealthiest 1 percent of households now own over 38% of all private wealth in this country, leading to the largest gap between rich and poor since the Roaring Twenties.
It is in these conditions, within the context of the large and growing gap, that still another skewed tax cut is about to become law. And we don't have to be conspiracy theorists to understand why it's so.
The influence of money in politics has never been more obvious. Less than 1% of the American people make political contributions of over $250. Half of all political donors have incomes of over $250,000. "The result", writes Bill Gates Sr., "is a government primarily concerned with writing rules and administering regulations to serve the interests of its paying patrons. The power of the political contribution will continue to diminish the power of the ballot." As Supreme Court Justice Louis Brandeis said over a century ago, "We can have concentrated wealth in the hands of a few or we can have democracy. But we cannot have both."
All of these issues -- about money and influence, wealth and poverty and how we will continue to live with one another in one society -- amount to the single question of distributive justice: what is fair? The Westminster Dictionary of Christian Ethics defines distributive justice as "the virtue by which goods and burdens of the community are distributed with due proportion among citizens."
"Due proportion" is a useful ethic to consider, and it brings us into harmony with the perspective that lay beneath the biblical injunctions on tithing, and on leaving the edges of the field to others for their harvest. The notion of due proportion is what also lies beneath a graduated income tax, and an inheritance tax on large fortunes. Due proportion is a concept mostly lacking in the current efforts to reduce and in some cases abolish taxes, and it falls to those of us who care about the ethics in this issue to introduce it again.
I know we've all got a lot on our plates, those of us who try to raise our voices in the public sphere. But to put it bluntly, we should be raising holy hell about the tax cut that has just been passed. In a time of soaring deficits, massive military action and growing poverty, it is outrageous that Congress has passed another tax cut for the rich. It is outrageous that the minimum wage staggers along at under six dollars an hour, while the wage it really takes to support a family in most parts of the country is closer to twice that amount. It is outrageous that we can't find money for schools, for healthcare or even for our veterans, but we can find enough to give more back to the wealthy.
I am probably at least as cynical as some of you. I have no Pollyanna-ish notion that as soon as a few of us write letters or make phone calls, our representatives will tremble at our ire and change their ways. This is a long, long struggle, and like most of the others in which we engage, there is no guarantee of victory. But the alternative to the struggle is despair.
It isn't despair for most of us -- we'll continue to feel outraged and upset, and wish that things were more just, more in line with what seems fair. But there is true despair out there, and it's growing. For those with no health insurance, for those working minimum wage jobs, for those trapped in terrible school systems, for those who are falling off welfare just when unskilled jobs have vanished….for them and for many others, we need to raise our voices.
In two weeks I'm scheduled to meet with Rep. Rob Simmons, who represents the part of Durham where I live. I encourage you to find out where your representative stands on tax issues and do the same, or drop a note to our Senators to thank them for voting against the latest cut. Remind them there are other issues to work on too, like raising the minimum wage. And remind them of something author Jedediah Purdy said a couple of years ago: "Every law and every political choice is in part a judgment about the sort of country we will inhabit and the sorts of lives we will lead." AMEN.