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Tax wealthy before cutting services

By Kay Bell · Bankrate.com
Tuesday, August 21, 2012
Posted: 4 pm ET

One of my favorite tax comments ever came from the late Russell B. Long. The longtime Democratic senator from Louisiana defined the practical and political problems faced in revamping the tax code in one sentence: "Don't tax you, don't tax me, tax that fellow behind the tree!"

Yep, everyone says they want tax change unless that change affects them.

And that's basically the finding of a recent poll conducted by Ipsos Public Affairs for the National Treasury Employees Union.

Two-thirds of the respondents in the survey agreed with the statement that "Congress should raise taxes on the wealthiest Americans before cutting funding for public services such as food and drug safety and border security."

"Some political rhetoric would have you believe that Americans today have an 'austerity at any cost' view of the federal budget," said Colleen M. Kelley, president of the Treasury employees' organization, in a statement released in connection with the poll results. "The fact is that most Americans, when asked about specific services, believe the government should invest more in providing such services."

That's the key. Specific services.

Another widely popular quote reminds us that all politics is local. That applies, probably more so, to taxes, too.

Everyone hates government waste, as well we should. But it gets a bit trickier in determining wastefulness when the dollars are specific. Often, folks don't consider it a waste of government resources or taxes if the expenditure benefits them or their family or friends.

That's human nature. For better or worse, the humans in Congress bring their personal perceptions about what's an appropriate tax and how to spend the money it brings in to their governing decisions. And things get even more difficult when those 535 personal tax perspectives on Capitol Hill must mesh with the millions of constituent views on taxes.

As for the Treasury union survey, at least one pundit thinks the pollsters asked the wrong questions.

Andrew Biggs, resident scholar at the American Enterprise Institute, told a Washington, D.C., radio station that the question should have been whether all Americans, not just the wealthiest, should pay more taxes.

"A lot of times, Americans are not willing to do that," Biggs said. "The reason is they're not sure the additional taxes they pay are going to go toward food safety or border security. They may go toward other projects that don't have anything like that kind of value. So I don't think the survey really gets at the core questions we're thinking about."

And that eternal question is, what will the tax do for me versus that man behind the tree?

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