Nope, the government doesn't help me

Warren Buffet has written an opinion piece in the New York Times about how he is paying too little in taxes. His bill this year was under $7 million, but only 17% of income while the rest of his office averaged 36% in taxes. For the sake of the deficit he is asking that his taxes be raised. A group calling themselves Patriotic Millionaires agree.

Michelle Bachmann shot back, Warren, the Department of Treasury accepts donations.

Susan Tompor in the Sunday Free Press talked to Clint Stretch of Deloitte Tax about that idea. Do you want to treat the federal government as a charity? Do you want to finance the war in Afghanistan through voluntary donations?

Child of the 60s and pacifist that I am the last comment brings to mind a poster I saw in my youth. It went something like this: "Wouldn't it be wonderful if our schools got all the money they needed and the armed services had to hold bake sales."



My dad handed me a copy of the latest issue of Washington Monthly and suggested I should read the cover article. It is 20,000 Leagues Under the State by Suzanne Mettler. There are two kinds of expenditures in the national budget. One is on direct programs where we actually see money going out. The other is indirect -- submerged -- programs where we don't see money coming in. Examples of the first are Welfare, Medicaid, and grants for education. Examples of the second are tax credits, deductions, and exemptions for a home mortgage, for charitable donation, for the cost of a health insurance policy. Mettler discusses the differences.

Indirect programs:

* are not seen as government programs and are hidden from the public. They don't register when people yell about getting gov't off their backs.

* are seen as allowing Americans to keep more of their hard-earned money rather than paying a fair share of tax.

* represented 7.4% of GDP in 2008, compared to 4.3% of GDP for Social Security. It's big money.

* offer modest assistance to most Americans but are a huge assistance to the rich. The GOP can say we shouldn't kill a benefit to the middle class but imply the rich are just like the middle class in need.

* cost the gov't $1 trillion in absent revenue.

* are not subject to the annual appropriations of the budget process, thus they grow unchecked.

* do not require an application process to determine eligibility.

* are used by both parties to achieve their objectives. I took advantage of Obama's credit for an energy efficient door.

* are keenly noted by vested interests, who avidly protect them.

* are almost unknown by the general public, who are passive about them.

* are sheltered from public scrutiny, mostly because the public doesn't know enough about them to care.

* work against democracy because so much is hidden.

Thankfully, Obama is beginning to talk about the fairness of such programs. He can even explain them to the public accurately and in understandable terms, when he bothers. When these programs are explained, opposition grows sharply. When direct programs are explained, support grows. Looming budget battles offer a chance to scale back the submerged tax code.