What Did You Get For Your Taxes? Probably Not Much

A few days after income tax filing day and I was wondering what did we all get for paying our taxes like good Americans. Reviewing a few recent publications reveals that we get precious little:

• According to a review article in the April 23, 2010 issue of The Week magazine, we are not getting a lot of value from the Federal bailouts of various industries. In a synopsis of an article by David Weidner of marketwatch.com, the Treasury Department forecasts that the U.S taxpayer will lose $89 billion on all Federal bailout programs. Now, the good news is that recent estimates put the loss at $250 billion. However, the bailouts have not worked. Rather than cutting banks down to size so that the "would not be too big too fail," just four banks now control 56 of all U.S. bank assets and 39% of all deposits. Guess the bailouts failed in keeping bank sizes under control. Of all the Federal programs that have been launched to help mortgage-challenged home owners, only 148,000 households out of four million in trouble have been able to use the Federal programs. This comes down to a success rate of about 3.4%, not a very attractive success rate. Thus, the 115 million households each contributed about $775 of their tax dollars on average to cover the $89 billion that we are stuck paying for and getting very poor results to show for it and the failure of the political class to fix the mortgage situation will guarantee that the housing industry will continue to be a drag on the economy.
• An excerpt from a Politico article was printed in the March/April, 2010 issue of Cato Policy Report showed that whatever we pay for taxes, somebody, usually a Washington lobbying firm, will pay more and probably get more for their dollars contributed to the political class. While ordinary Americans are having trouble paying their mortgages, finding a job, etc., the lobbying industry must not have such mundane concerns. The article reported that in 2010, Washington D.C. lobbyist firms will easily spend more than they spent in 2009 when they spent a record setting $3.3 billion for lobbying activities. With 535 politicians sitting in Congress, this $3.3 billion comes out to about $6.2 million per Congressional representative. Who do you think gets the most attention: you who pay your measly income taxes or the lobbyists who throw around millions of dollars for each politician in Washington?
• According to a National Review Online article by Mark Steyn that was summarized in the April 23, 2010 edition of The Week magazine, for the just completed 2009 tax season, the Tax Policy Center reports that 47% of all Americans will not pay a single cent of Federal income tax. Think about that: if you paid taxes, than it is highly probably that one of your neighbors did not have to pay any Federal income taxes. They still got all of the benefits of being an American citizen without having to pay for it. Just thought you would like to know.

So let's review. The political class has wasted billions of our dollars without materially changing the financial system malaise that got us into the Great Recession, whatever we individually pay in taxes, it is dwarfed by what the lobbyists are spending to influence Congress to the lobbyists benefit and not the American citizenry benefit, and almost half of all Americans do not have to pay Federal income tax and still get all of the benefits of being an American. Talk about being screwed up. And it was the incumbent set of current politicians that got us into this mess. The first step should be to expel all of them in the November elections and replace them with politicians that allow companies and their overpaid leadership to fail and not waste tens of billions of taxpayer dollars, that enact campaign finance reform and lobbying reform laws to significantly reduce the influence of lobbyists and re-empower individual Americans, and that reform the tax laws so that every American is treated fairly and pays their fair share of the government upkeep.


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