Skip to main content

Who benefits from government?

When I discuss taxes and equity, I teach my students about the benefits principle of tax equity (i.e., who pays the tax should correspond to who receives the benefits) and discuss this as one rationale for why we have a progressive income tax system. But students always have a hard time grasping the possibility that "rich" people benefit from government as much as "poor" people. This attitude is also contributing to California's budget difficulties since Republicans are insisting that the budget gap must be closed entirely with spending cuts - I can only assume that those who support this position are seriously underestimating the benefits they personally receive from government services. So I LOVED this editorial from the Sac Bee that points out the many ways that not-poor people benefit from state spending. I'll be using it next semester as the starting point for our discussion of progressive taxes:
The largest portion of the state's general fund budget (more than half, or $51.7 billion) goes toward education. Do no rich and middle-class folks send their children to public schools or to California's public universities? Do UC Berkeley or UCLA or UC Davis have no rich or middle-class kids?

The next-largest portion of the budget goes toward health and human services (about one-third, $31.6 billion). Do middle-class folks have elderly parents who need nursing home care? Costs average $4,500 a month. While some people can afford to pay this bill on their own, most seniors quickly exhaust their savings and assets. In fact, a majority of all the people in nursing homes in California have their care paid for by Medi-Cal.

Then there's the state prison system (more than 10 percent, $10 billion). Who benefits when convicted criminals are taken off the street and sent to prison – only the poor? C'mon.

The state also spends money on transportation and economic development (nearly 3 percent, $2.6 billion). Do the rich and middle class use roads, bridges, trains, airports and ports?

Then there's state spending on California's natural resources (2 percent, $1.9 billion). Do the rich and middle class enjoy the state park system? Do they get protection from wildfires? Do they get clean water supplies from the state's waters? Do they benefit from flood protection levees?

In the current economic downturn, are middle-class folks affected by job cuts? Might they need health insurance coverage or food stamps or unemployment checks while they search for a job?

Comments

  1. Here's a modest proposal: Admissions fees to state parks that vary with the zip code of residence. We have zip code based income data, so let's charge higher admissions fees for park visitors who live in higher income zip codes. (I am, by the way, at least 60% serious about this.)

    ReplyDelete

Post a Comment

Comments that contribute to the discussion are always welcome! Please note that spammy comments whose only purpose seems to be to direct traffic to a commercial site will be deleted.

Popular posts from this blog

What are the costs?

I came across an interesting discussion about a 19-year-old intern who was fired from The Gazette in Colorado Springs for plagiarism. There appears to be some controversy over the fact that the editor publicly named the girl in a letter to readers (explaining and apologizing for the plagiarism), with some people saying that doing so was unduly harsh because this incident will now follow her for the rest of her career. I was intrigued by this discussion for two reasons - one, it seems pretty clear to me that this was not a case of ignorance (as I have often encountered with my own students who have no idea how to paraphrase or cite correctly) and two, putting aside the offense itself, I have often struggled with how to handle situations where there are long-term repercussions for a student, repercussions that lead the overall costs to be far higher than might seem warranted for the specific situation. As an example of the latter issue, I have occasionally taught seniors who need to p

What was your high school economics experience like?

As I mentioned in my last post , I am asking my Econ for Teachers students to reflect on their reading by responding to discussion prompts. It occurred to me that it wouldn't be a bad idea for me to share my thoughts on those issues here and see if anyone wants to chime in. For this week, the students were asked to read the California and national content standards , an article by Mark Schug and others about why social science teachers dread teaching economics and how to overcome the dread, an article by William Walstad on the importance of economics for understanding the world around us and making better personal decisions (with some evidence on the dismal state of economic literacy in this country), and another article by Walstad on the status of economic education in high schools (full citations below). The reflection prompt asks the students to then answer the following questions: What was your high school econ experience like? What do you remember most from that class? How do

When is an exam "too hard"?

By now, you may have heard about the biology professor at Louisiana State (Baton Rouge) who was removed from teaching an intro course where "more than 90 percent of the students... were failing or had dropped the class." The majority of the comments on the Inside Higher Ed story about it are supportive of the professor, particularly given that it seems like the administration did not even talk to her about the situation before acting. I tend to fall in the "there's got to be more to the story so I'll reserve judgment" camp but the story definitely struck a nerve with me, partly because I recently spent 30 minutes "debating" with a student about whether the last midterm was "too hard" and the whole conversation was super-frustrating. To give some background: I give three midterms and a cumulative final, plus have clicker points and Aplia assignments that make up about 20% of the final grade. I do not curve individual exams but will cu