What would the effects of democratic "allocatable taxes" be?

Great Debates
1

The US is more polarized politically than ever before, and nearly 50/50 split.

The idea of “allocatable taxes,” is that people pay the same amount of tax total, but are able to specifically allocate that amount by percents to different categories like healthcare, military, food stamps, foreign aid, etc.

Sounds very democratic, moreso than the current system! Who wouldn’t want to be able to make sure none of their money goes towards blowing up brown people in the third world, or maybe that none go to any of those welfare queens rolling up in their Cadillacs to pick up steak and lobster every month with their food stamps? It’s win/win for both sides of the aisle!

The actual categories in the President’s proposed 2015 budget are:
[ul]
[li]SSI, Unemployment, and Labor - 33%[/li][li]Medicare & Health - 27%[/li][li]Military - 16%[/li][li]Energy & Environment - 1%[/li][li]Science - 1%[/li][li]Housing & Community - 3%[/li][li]Education - 2%[/li][li]Interest on Debt - 6%[/li][li]Veteran’s Benefits - 4%[/li][li]Food & Agriculture - 3%[/li][li]Transportation - 3%[/li][li]International Affairs - 1%[/li][/ul]

For the sake of the hypothetical, let’s assume that payroll taxes are also allocatable (currently used to fund the two the biggest line items in the budget, SSI and Medicare), giving us a round 80% of the total tax revenue of the US government that is now democratically allocatable.

What would the effects be of the US having allocatable taxes?

My initial hypotheses would be that SSI and Medicare would both take big hits right away. Although seniors are a powerful voting block, by percent of population they’re pretty well outweighed by younger folk, many of whom may not even believe SSI will be there for them in 40 years, so why fund it now.

I would also expect a rise in Science and Energy & Environment from their current 1%, and a drop in Food & Agriculture from 3% (with only 2% of the US living as farmers, it’s hard to believe most people would collectively allocate ~$500 billion to this).

Aside from those, I don’t see any really obvious changes, what do Dopers think the effects might be?

And would you be in favor of this initiative, and if so why / why not?

2

Does the American public have a real understanding of where the money actually needs to go?
Without that knowledge, this is a gahddamn stupid and dangerous idea.

3

Shouldn’t the American public have some say in what it spends it’s money on? Who defines “need” in this case?

I’m suggesting we let the American people define our “needs” and national priorities collectively, instead of by a captive set of politicians whose main interests are their campaign donors and lobbyists, which is the current way we allocate what we “need” to spend money on.

But for the sake of the hypothetical, let’s assume it defaults to the current or “recommended” proportions for everyone, and only those with an interest can then take the further steps necessary to allocate their taxes.

Why do you think it would be catastrophic? What specifically would get defunded or overfunded that would lead to catastrophe?

4

That’s why we elect our representatives.

5

I tend to agree in terms of the entire Federal budget, although I do think it would be very interesting to take a small proportion of the Federal budget (say 1% or so), and put that up to a referendum (without tax refunds being an option, of course).

I’d be really curious how that vote would split out. What would have the plurality, and by how much? What categories are 2nd, 3rd and 4th? And so on…

Or maybe have a “proposed budget” referendum and see what the crowdsourced budget might look like vs. the actual one.

6

We do. It’s called an election. As you alluded to in your OP, different politicians have different priorities for spending, and they campaign on that.

7

Budgets would fluctuate wildly.

Education might get 20% of the budget one year, then 1% the next.

8

Yes, but people in the aggregate are fairly unhappy with this situation. Half the country is left out every election, as the party they didn’t want comes into office. Budgets are getting stonewalled to a degree that the US’s overall credit rating was cut. Congressional approval ratings are the lowest they’ve ever been.

This is a hypothetical alternative worth evaluating that theoretically offers both sides of the aisle a direct say. So far, people seem against it, without articulating many reasons why.

9

I think this is less of a concern specifically, because the bulk of education funding at the school level comes from the local community, with the federal contribution a relatively small portion of overall school spending.

But yes, it’s a good point. If Science spending goes up to 5% one year, are we hiring a boatload of scientists from overseas who have to be cut the next year when it goes down to 2%? Or are things allocated at a grant level with defined timelines? The second method seems preferable, even if you’re able to fund fewer programs every year due to baking in multi-year budgets with the funds allocatable that year.

10

Jack Haldeman II wrote this story https://www.sff.net/people/jack.haldeman/people.htm about that idea back in 1983, by the way.

11

So since American’s aren’t able to manage functional government, they should be given direct access to budget allocations? Good luck with that.

12

Why not? If the current system isn’t working and half of the people are unhappy with it at any given time, why not try something that gives everyone individually a direct say?

What do you think would go wrong?

13

Flippantly? Americans.

Seriously? Governmental gridlock is a product of recent political alignment and ossification. Why on earth would opt to ignore the recent problem to craft up a completely untried budgetary process that cuts at the root of representative democracy?

14

(Sorry, double post.)

15

For the record, I totally agree that a better solution would be to fundamentally change the way politicians are incentivized and elected in America, as well as overarching political change that would feature compromise, maturity, and having the nation’s interest at heart from both parties going forward.

While we’re at it, I’ll take a flying pony powered by rainbows, and some of those gumdrops that make you 10 years younger.

In the meantime, allocatable taxes has something for everyone. It has the potential to have broad support from both parties, and enough actual popular support from real people that it might stand a chance of really happening someday, unlike the rainbow-pony things we’d really like such as compromise, maturity, and having the nation’s best interests at heart.

Is it a terrible idea? Maybe. I haven’t seen any actual, cogent arguments why it might be so far, but broadly, folk here seem to dislike it.

16

Cite? Not that people are unhappy with Congress, but that they are unhappy with representative democracy itself.

That’s democracy for you. Candidates were elected that made no secret of their willingness to shut down the government and risk our credit rating over political issues, and then followed through with their promises. The people being disconnected from power isn’t the cause of these problems, as it was the people who put Tea Party extremists into power.

Here’s an analogy: say your car starts refusing to shift out of first gear. Would you take it to a mechanic that you trust, or allow everyone in your neighborhood to vote on what parts to buy and what the problem might be?

Point being, budget issues are complicated and require some level of expertise. Take that 6% allocation for “Interest on Debt”, for example. That’s not a sexy or fun thing to spend money on, and it brings no tangible benefit to your neighborhood. And yet, it’s extremely important. A person who spends much of their time on budget issues, who understands things like baseline spending, who has a whole staff to research particular budget issues, is in a position to make an informed decision. A random taxpayer presented with the list from the OP is not.

17

So American politics is broken but the parties will agree to effectively remove their ability to shape politics?

Leave aside current American political landscape and consider that most people have no idea how to run the budget of a country that has it’s own currency. Consider the difficulty in providing long term funding to any type of activity. Consider the ridiculous amount of power available to monied interests to build budgets for themselves.

Then take into account the problem of direct democracy and the mob instinct. You see it at Trump rallies now, why would you want to directly apply it to federal budgeting?

18

Your proposal wouldn’t change the unhappiness. Say Republicans decide to give most of their money to the military and its budget increases; liberals won’t be happy about that. Or say Democrats give nothing to the military and then North Korea invades South Korean; conservatives won’t be happy about that.

The reason people are unhappy with the budget is because the two (main) sides of the budget debate have opposing views. No budget, no matter how you apportion it, will make people happy.

19

Well, the point I was making is that the only “mechanic” available in this situation is either somebody that hates you and will actively sabotage your car, or somebody who might fix it but has a lot of other things to deal with also, and it’s fifty/fifty which mechanic you’ll get. With those odds and choices, I’d absolutely crowdsource to get ideas on what I should fix.

The interest on debt is a good example of something that would likely get cut unfairly. Let’s take it off the table, and just leave the other spending categories.

And I’m not sure I buy that our current policy makers are making informed budget decisions, at least not informed by facts and razor-sharp staff. Informed by big suitcases of money and lobbyists, sure. As above, was shutting down the entire government and getting our credit rating cut a well informed and staff-supported move?

20

I’m not sure I agree. Wouldn’t you be happier if your personal money only went to support things you really believed in, and none of it went to things you didn’t want funded?

I know I would feel much better in that situation, and I think a large number of other Americans would feel the same way. The overall collective budget may make some unhappy viz your military spending example, but I have to think many people would be more satisfied than they are now, because their personal contribution went to where they personally wanted it to go, and it didn’t go to things they found repugnant.