Everyday Erinyes #150

Experts in autocracies have pointed out that it is, unfortunately, easy to slip into normalizing the tyrant, hence it is important to hang on to outrage. These incidents which seem to call for the efforts of the Greek Furies (Erinyes) to come and deal with them will, I hope, help with that. As a reminder, though no one really knows how many there were supposed to be, the three names we have are Alecto, Megaera, and Tisiphone. These roughly translate as “unceasing,” “grudging,” and “vengeful destruction.”

Anyone who keeps up with the news has probably seen this headline, or some variation of it:

IRS cuts audits of the rich while stepping up audits of the poor after budget cuts

But, at least at AlterNet, even the sub-head should be enough to lower ones anger with the IRS and turn it where it belongs:

Thanks to GOP budget cuts, the IRS allows rich people to avoid paying billions while persecuting the working poor.

And the first sentence spells it out even more clearly:

Republican cuts have crippled the Internal Revenue Service’s ability to audit rich tax cheats, while pressure from those same Republicans has led the IRS to increase audits of the working poor.

So, how did we get to this point? ProPublica can tell us. Their summary of their investigation starts off with the story of one man, and I’ll quote that (and maybe a chart) and then recommend you read the full article.

In the summer of 2008, William Pfeil made a startling discovery: Hundreds of foreign companies that operated in the U.S. weren’t paying U.S. taxes, and his employer, the Internal Revenue Service, had no idea. Under U.S. law, companies that do business in the Gulf of Mexico owe the American government a piece of what they make drilling for oil there or helping those that do. But the vast majority of the foreign companies weren’t paying anything, and taxpaying American companies were upset, arguing that it unfairly allowed the foreign rivals to underbid for contracts.

Pfeil and the IRS started pursuing the non-U.S. entities. Ultimately, he figures he brought in more than $50 million in previously unpaid taxes over the course of about five years. It was an example of how the tax-collecting agency is supposed to work.

But then Congress began regularly reducing the IRS budget. After 43 years with the agency, Pfeil — who had hoped to reach his 50th anniversary — was angry about the “steady decrease in budget and resources” the agency had seen. He retired in 2013 at 68.

After Pfeil left, he heard that his program was being shut down. “I don’t blame the IRS,” Pfeil said. “I blame the Congress for not giving us the budget to do the job.”

Starting in 2010 – which you may remember was the first Congress in an unbroken line until now to be majority Republican in the House, which has the power of the purse – the budget of the IRS has declined every single year. In 2018 dollars, a budget of $14 billion has sunk to a budget of $12 billion. Could anyone reading this afford to take a permanent 14% cut in your income? Yeah. I didn’t think so. So it’s no wonder the IRS is not accomplishing what it used to accomplish before 2010. Pro Publica’s investigation led it to the conclusion that – speaking conservatively – the government has lost revenue to the tune of $18 billion per year on account of the cuts (yes, the IRS more than pays for itself, if allowed to.)

And there’s one big reason the IRS has difficulty pushing back. No one – NO ONE – loves it. Everyone fears it. People who have little money, whose lives could be improved if the Federal government could collect some or all of the $18 billion don’t see that – they see a fear that they might lose some of the little they have. And, of course, that’s how Republicans want it. That kind of fear is how they control their base.

In fact, since 1994, when Newt Gingrich became the Speaker, abolishing the IRS entirely has been a plank, not always obvious but pretty generally present, in the Republican platform. They have suggested openly replacing income tax with a universal sales tax, which they claim is “fair.” Sure, because, compared to the poor, they do not buy as much. They do not spend nearly as much of their income on commodities.

I could come up with a fairer system (for Federal Income Tax.  I’m not prepared to start talking about withholding for Social Security and Medicare, except to support “Scrap the Cap.”). Every individual and every entity would be treated the same. There would be no special rules for businesses and no exemptions for charities or churches. My lowest tax bracket would be $0-$99,999.99, and the tax rate for that bracket would be zero. The next bracket, $100,000-$249,999.99, would have a rate of 1%. The increases would get steeper – if I had the data I could do the math, but I don’t, so I can’t. But it could be done.  If this sounds like a quote from JFK, it is, sort of.  He got it from Luke 12:48:  “And unto whomsoever much is given, of him much shall be required”  (Douay)

And the IRS would certainly still be needed. Like the apocryphal diaper which ain’t gonna change itself, pal, enforcement would still be necessary. Taxes ain’t gonna collect themselves.

Of course this is a fantasy. But the reality is that, since Republicans are no longer going to do it, Democrats need to stick up for the IRS. The best tax system in the world is not effective if it is not enforced. Republicans are not willing to enforce it because they cheat. We must be willing, both to reform the system, and also to enforce the system we have while we have it.

Additionally, the best governmental principles in the world cannot provide for the general welfare if that government has no money with which to do it.  There is nothing wrong with the concept of “tax and spend” (it beats the heck out of “spend and tax,” as Republicans are wont to do.)

Alecto, Megaera, and Tisiphone, I realize sticking up for the IRS will be a hard sell, and will be made harder by the pushback from Republicans, who will push back expertly, using every fear in the playbook. But it’s going to have to be done. Eventually. And a beginning has to be made. Somehow. Help us find the people who will be good at it, and encourage them to work on it, and help them with resources needed to get it right, and stand by them when they are selling it.

The Furies and I will be back.

Cross posted to Care2 HERE.