Who pays for American democracy?

Chris Fehm (0:05)

I'm the McCordney Institute for Democracy at Penn State University. I'm Chris Fehm.

Candace Watts-Smith (0:10)

I'm Candace Watt-Smith.

Janice Benelli (0:11)

I'm Janice Benelli, and welcome to Democracy Works. This week, we are talking all about taxes and the role that they play in our democracy. Our guest is Vanessa Williamson, who is a Senior Fellow in Governance Studies at Brookings, as well as a Senior Fellow at Urban-Brookings Tax Policy Center. She's also the author of a fantastic book called The Price of Democracy that really tells the story of taxation in America through many pivotal points in American history. It sounds boring, I can assure you it is not. There's a lot of really great storytelling in there.

First of all, it's the first time, I think, in 300 some-odd episodes that we've ever talked about taxes on the show.

But it's also, I think, of a special interest to me personally. My brother is a CPA, I was just talking to him about tax stuff last week, and he went off on like schedule C and this, that and the other and all these things I should do. And my dad did tax preparation on the side when we were kids. So taxes have always sort of been in the back of my mind and it was great to get this additional context from Vanessa. And hi to dad and Nick, if you end up tuning in to this episode because you're interested in the topic. It'll be the first time either of them have ever listened to Democracy Works.

Chris Fehm (1:33)

You know, we only vote every two years, maybe with local more than that, but we pay taxes every year. And the other thing is that taxes is, there's an old line that a budget is a moral document. It's, it's spelling out where your values are.

And that is a fundamentally democratic question. If you're going to need money, then you're going to need money because you've decided that these things are worth spending money on, whether that be schools or roads or military, or, you know, the, the beagles in the airport, whatever it is, these things cost money. And so how you determine how government spends that money is inherently democratic, right? At least for us, right? The, the first thing, the first power that is granted to Congress and the Constitution is raising taxes. So it is, it's at the core of these democratic questions.

Candace Watts-Smith (2:31)

Well, we know that part of how we and why we even have a representative democracy is because people were charged taxes and so they wanted to be able to have a say over what their money was going to be used for. We haven't talked about taxes specifically, but to your point, Chris, we have talked about budgets, we have talked about representation, and we've also talked about the administrative seat. And so I think this is a really great opportunity to talk about taxes directly because all of those things are fueled by taxes and the conversation has been there in the background. And so we're lucky to have Vanessa Williamson just take it on more directly so we can talk about the thing and not around the thing. The conversation around taxes across history often shows us times when people think that there's too much democracy in our democracy. And so a lot of the arguments that we have about taxes is about who gets a say.

And when people are willing to act collectively to bring public goods, who gets access to those goods?

So there's that one thing I think that runs through. And we can start back at the Constitution. And I actually don't think that she overstates the role of taxes and slavery because, as we'll remember, the Constitution was a series of compromises. And slavery as a system was not on a docket. What was on the docket was the extent to which sustaining slavery would be made easy or difficult. So the Three-Fifths Compromise is shorthand, yes. Because you will remember that the South wanted to count slave as one person for representation and zero property for taxes. For taxes. So the Three-Fifths Compromise becomes the federal ratio that's used in the Articles of Confederation. And again, adopted as precedent in the Constitution. But there are other things about taxes and slavery in the Constitution. And one has to do with the import tax. And so, like, someone could have said, we're going to tax the hell out of enslaved people. And that would make it really high and really expensive for you to do. But what did they do? They said, we're going to limit it to $10 per head.