Obama Must Spread Tax Burden to Help Economy and Democracy

To be fair, all earners must pay, helping the economy and easing class resentment in the process.

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I come from a typical middle-class family, but when it came time for college, financial trouble hit. My parents called a family meeting and told my siblings and me that we'd be putting ourselves through college. We went to state universities and service academies, took out loans, and worked at part-time jobs between classes.

At various times in college, I was a dishwasher, a librarian, and a complaint desk manager. I even worked in the underwear section at a men's shop (just what you want your 20-year-old daughter doing). Because I was working hard and paying my own tuition, I didn't take notoriously easy courses, buy brand-new textbooks, or sleep through morning classes. Kids waste their parents' college money all the time, but a funny thing happens when they're paying their own way: They suddenly become fiscal hawks.

Maybe if more college kids personally paid at least a portion of their own tuition bills, they'd hold a financial stake in seeing that things turn out well.

So, no postgrad tour of Europe for me: I worked to pay back my student loans at $66 a month, which was a big chunk of my $13,000-a-year salary as a receptionist for a congressman. I also started paying taxes on that $13,000. After withholding, I earned $750 a month—a grand total of $9,000 a year in take-home pay. (Granted, these were 1985 dollars.) Believe me, when roughly a third of your measly income goes to taxes, you are painfully aware of where your dollars are going and how the government spends them. Over time, you become very aware of where the next tax bracket lies, and you start making decisions about whether it's worth it to take a second job, continue to rent a house, and, later, whether to stay home with the baby.

Today, a person at my post-college income level would be exempt from paying taxes. That's because over the years, more and more Americans have been removed from the tax rolls. Earlier this week, more than 40 percent of households did not have to write a check for any federal income tax at all. According to the Congressional Budget Office, the top 20 percent of taxpayers—whose average household pretax income of $250,000 drops to $180,000 after taxes—are paying 69 percent of all federal income taxes and a whopping 86 percent of all individual income taxes.

That may sound like a lot of income if you live in Indiana or Iowa. But if you live in New York City, Los Angeles, or Washington, it's something completely different. In some parts of America, $200,000 of household income makes you Bill and Melinda Gates. In others, it makes you the high school principal and your spouse a government employee.

Under President Obama, that tax burden is about to increase exponentially. Even after putting his proposed tax hikes aside, the average middle-class family will pay an additional $200,000 in federal taxes over the next 10 years simply as service on Obama's $6.5 trillion in deficit spending, according to Michael Boskin, the former chairman of the Council of Economic Advisers under President George H. W. Bush. "In other words, a middle-aged, two-career couple in New York or California could get a future tax bill as big as their mortgage," he writes, because of massive government spending.

That strikes me as dangerous economically. At some point, the camel's back will break. Relying on a smaller and smaller minority of taxpayers to fund the cost of a massively sprawling government for millions of Americans is simply untenable. The rational economic decisions of those facing higher tax burdens will soon begin to play out in terms of productivity and employment figures, as well as housing sales and business starts. A fair, across-the-board tax code would promote economic growth and broaden the tax base. Don't get me wrong: I hate taxes. But a low tax rate imposed on everyone who works would be preferable to a small minority paying exorbitant amounts for more and more programs—while millions of earners pay nothing at all.

Laying such a big burden on such a small group is bad for democracy; it pits us against one another. George Washington warned in his Farewell Address against instigating partisan resentment that "agitates the community with ill-founded jealousies and false alarms; kindles the animosity of one part against another, foments occasionally riot and insurrection." What happened to Abraham Lincoln's call to rely on "the better angels of our nature"?