Why we hate tax.......

The following is a comment from a New York Times Article:

'I don't care if every street light stays off, I don't care if public employee rolls get cut in half, I don't care if unemployment goes to 15 percent. Not a penny more in higher taxes'.

America is one of the richest countries in the world. It is a country that can put a man on the moon, it spends billions on the most upto date military spending in the world. Yet, the US is currently cutting back essential welfare services. Why can the richest country in the world have disintegrating road and public transport services?

The above comment may sound extreme, but, it is merely the honest statement of the current conservative philosophy of tax cuts and state involvement.

It is simply a choice. If you insist on tax cuts for the rich, you won't be able to afford public spending. If you choose tax cuts at all costs, it means you have a society with crumbling roads, lack of investment and increasing social division. You may not care about a divided society, you may not care about a crumbling infrastructure network. But, if you follow the religion of tax cuts at all costs this is what you are choosing.

Unfortunately, in America, the philosophy of tax cuts is seen as a win win situation.

•Cut taxes and you get more revenue (because people work harder)

•Cut taxes and you will get higher economic growth.

Like a mantra the conservative commentators repeat government bad, tax cuts good.

It is lazy economics, of course government spending can be inefficient. But, government spending can also overcome market failure, it can help create social cohesion.

It is not a clear black and white issue. It is not a question of government good or bad. It depends on how it is spent and on what projects. The issue is to maximise the efficiency of spending and make sure it is directed to those areas of the economy (health, education, public transport) where the free market invariable fails to create a socially optimal level.

It doesn't seem to matter than the US economies greatest decades were in periods of relative high tax (70%) in the 40s and 50s. Nor do the tax cuts to the richest 2% of the population during the Bush years seem to have promoted job growth in a way that occured during the Clinton year's of higher tax.

Just to make things worse, in recent years, the biggest tax cuts in America were directed at the richest people in society. But, when you cut taxes for the rich, it is more likely the tax cut is saved. If you cut taxes for the poorest, a higher % would spending the money and it would have a bigger impact on economy.