Don't Fear the "T" Word

You don’t have to be a genius to know the basics of running for office: Look sharp, love America, take in big money, and—most important—promise you won’t raise taxes. Thanks to Grover Norquist and his band of anti-tax crusaders, raising taxes has come to seem akin to murdering puppies and loving terrorists. Even during the worst fiscal crisis in 80 years, if you’re a state lawmaker, you must cut core government programs without ever mentioning the “T” word. And if, God forbid, you decide to raise taxes anyhow, do everything you can to distract people from the effort. Openly calling for citizens to pay more to their government is nothing short of political suicide.

By this conventional wisdom, it may seem like Jerry Brown has a death wish. After years of mounting debt and drastic cuts to state services, California’s Democratic governor has proposed raising the state sales tax along with income taxes for wealthy residents. Despite its liberal reputation, California is hardly an easy place to pass a tax hike; to raise taxes, state law requires a two-thirds vote in the legislature or a successful public initiative. Brown has opted for the initiative process, and his statewide campaign lays out the stakes: Failure to pass his plan in November will trigger automatic cuts to education spending. Californians are getting the message. According to a Public Policy Institute of California survey, 68 percent of likely voters support Brown’s plan—including 53 percent of Republicans. 

Brown’s loud-and-proud tax plan is a bracing rebuke to the political norm. “The right wing has been so successful at demonizing taxes over the past three decades that it’s hard for there to be the climate for an honest discussion,” says Jon Shure of the Center on Budget and Policy Priorities. But state lawmakers are raising taxes. According to the center, between October 2008 and September 2009—the first year of the recession—taxes went up in 33 states. By and large, the hikes were modest and had to be combined with spending cuts, but they still helped save jobs and preserve essential services. “Despite all the rhetoric,” Shure says, “tax increases are in fact a major part of dealing with the impact of the recession and make very, very good fiscal sense.” 

You wouldn’t know it, though, from listening to most Democratic officials. New York Governor Andrew Cuomo campaigned on a promise of “no new taxes, period.” Even when he struck a deal last December to raise income taxes on the wealthy to close the state’s budget gap, he continued to insist, “I am against higher taxes.” When Democrats shy away from championing a vision of fair taxation, it gives conservatives the upper hand, rhetorically and politically. 

For instance, as the 2008 financial crisis hit New Jersey, Democrats raised income taxes on those making more than $400,000, as well as sin taxes—on alcohol, cigarettes, lottery winnings. But they didn’t make a strong case for the necessity of the taxes and passed them on a temporary basis. When Governor Chris Christie took office in 2010, he refused to renew the increases, and now, as the state faces another shortfall, he’s pushing for cuts disproportionately benefiting the wealthy. Democrats are fighting back but avoiding the “T” word as they do—talking instead about the need “to restore the surcharge differential on those who earn $1 million or more.” 

By contrast, Maryland Governor Martin O’Malley has been straightforward about raising taxes to maintain the state’s schools and services, which are among the nation’s best. In 2007, he combined tax increases with budget cuts to address structural deficits. O’Malley got re-elected in 2010—a bad year for other Democrats—by a 14-point margin. This year, even as he positions himself for a possible presidential bid in 2016, O’Malley is pushing a gas-tax increase and an income-tax hike on the wealthy. “Asking our fellow citizens to do more will not be popular,” O’Malley said in his 2012 State of the State address. “But without anger, fear, or meanness, let’s ask one another: How much less do we think would be good for our children’s future?” 

In 2012, Democrats have an opportunity to reframe the tax debate, as Brown and O’Malley have done. Public anger has risen over economic inequality. Most states are suffering from cuts to popular institutions—schools, firehouses, parks. Smart politicians can sell tax increases as fair and prudent. In the process, they can also highlight the extremism of Republicans who have sworn to never raise taxes, no matter the circumstances. Advocating a better tax policy needn’t be political suicide. In fact, the bigger political risk comes from failing to do so.

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