Transcripts For CSPAN2 Vanessa Williamson Discusses Read My Lips 20170704

Im a senior fellow here at brookings. Im happy to be here for two basic reasons. One, this is a great book. Two, vanessa is an awesome person. I am just so happy that vanessa, about a year ago, joined us here at the Brookings Institution and promptly produced this great book, having been here for a short time. I think i will go through the formal intro of vanessa. But heres something that says a lot about her i think, which is vanessa has written two books. Coauthored the first. The first one is called, the tea party and remaking of american conservatism. Vanessa as this book shows is woman of very strong convictions but in her tea party book, her convictions are quite different from those of Tea Party Activists she showed an enormous capacity for sympathetic understanding of people she profoundly disagrees with. We need that gift of empathy at this moment in our politics. So just to tell you how were going to do this, vanessa will come and talk about this great book and her findings. Then i will introduce an Allstar Group of respondents, who will respond to vanessa. Then im going to start a discussion among all three. Then well bring you all into the conversation. So who is vanessa . She is a fellow in the government studies program at brookings. She studies the politics of redistribution with a focus, as this book shows, on taxation. She is coauthor of the, the tea party and remaking of republican conservatism with the scotch poll. Was named one of the 10 best political books of the year by the new yorker. She also examined the political origins of tax credit. Electoral effect the of the american recovery and reinvestment act. She testified before congress. She has been on cnn, msnbc. She has written for a variety of publications, not only the New York Times and the atlantic but also teen vogue. And also her hometown newspaper, the sacramento bee, as well as the atlanta journalconstitution. She has been cited all over place by economists, npr, and ap. She received, has a masters degree from miu institute of french studies. She will do a side lecture on wine people consume while paying their taxes. She has a ba in french language and literature from nyu. I love having you as a colleague, vanessa, and congratulations on the book. [applause] so my goal today is to convince you that american see tax paying something to be you proud of. I have studied this for six years. Ive done interviews. Ive conducted surveys. I read People Public states about taxation. I watch what people do when they vote and in america to pay taxes is something almost universally understood as a civic duty and a moral obligation. Now i recognize that in this political moment i have set myself a difficult task in convincing you of this. So last fall, for instance we elected a president who describes tax avoidance as the smart choice. Next few weeks well see major tax reform policies that will likely involve very large tax breaks, probably heavily to the wealthiest among us. Of course for years our federal government, especially our cities and states strugfelled with major budget shortfalls. So in this context, how can it be that americans are proud to pay taxes . Arent we in fact a nation of, Grover Norquist, right, happy to drown the government in a bathtub if we get a few dollars in our pocket . I am not, i dont want to distort or discount the views of conservative americans. In fact, as ej said, my last book was a study of the tea party. It was actually at a tea party rally that the question that i tried to answer in this book first occurred to me because it was at a tea party rally where i noticed how common it was for Tea Party Activists to describe themselves as taxpayers. I pay my taxes. As a taxpayer i and the end of that sentence was almost never about taxes. It was almost always about their right to be heard. Their right to participate in american politics. In america even for very conservative americans being a taxpayer, using taxpayer is shorthand for being an up standing contributing citizen who has earned a place in this country and has earned representation by their government. On many issues the tea party is on the american right but seeing as tax paying a commitment to community and country, theyre in fact part of a very long american tradition. Americans use their status as taxpayers to define their community and to demonstrate their worthiness as citizens. Revolutionary thomas payne said all accumulation of personal property beyond what a mans own hands produced is derived to him by living in society. The oath of every principle of justice and gratitude of civilization a part of that accumulation back again to the society from whence it came. Paying, responsibility of tax paying comes from the fact we are in a society indebted to one another. The fact that we pay those debts, when we pay our taxes is the reason we have a right to be represented by our government. The National Womens Rights Convention in 1866 asked, women hold vast amount of property in this country and pay as portion of taxes. On what principle then do you deny her representation . That link between taxation and representation is not just something the revolutionary war or the suffragette movement. It is in our politics. In 1959, africanamerican activists integrated beaches miami, which was very dangerous Political Action they brought with them to the shore, they brought with them their property tax receipts. Because it showed that they had paid to maintain those beaches t showed those beaches belonged to them like everyone else. It showed that they had paid their share. They had the receipts to prove it. So the tax paying is played important part of political rhetoric of revolutionaries and reformers this country. Last 40 years survey ask americans to see tax paying a responsibility . In the decades americans held constant view. Common survey we is whether it is civic duty for americans to pay their taxes. Nine in 10 americans disagree and five in 10 of the public disagrees. About 6 of the americans think the moon landing was faked. So when 5 of americans believe something, that is about as close to consensus youre ever going to get. These are views that americans hold strongly. In interviews with some of my survey respondents i was surprised again and again, i asked frankly a somewhat boring question about taxes. I would get the bold answers about patriotism and duties of a citizen. I remember a marine from california, this is the first question i asked him, i say the word taxes to you, what does that make you think about . He said, the cost of being an american. He was a marine. Taxes still made hill think that, right . He paid in much more concrete way. Another person i spoke to democrat from florida, my last question tended to be ive been interviewing because i want to write a book about americans attitudes about taxes but if it was your book about attitude, what would the most important be . I want to remind everybody, that no man is an island. Were all in this together. It wasnt just democrats or independents. Spoke to republican in ohio, very conservative man, retired mailman, angry about what a lot government does, when i asked him how do you feel when filling out income tax forms . He said i feel im doing my part. Whats interesting if it is not just that americans have a nice words to say. Theyre putting money where their mouth is. So americans as a rule are remarkably committed taxpayers, by national standards. Americans largely pay their taxes honestly and on time. Economists say at rates higher than can be explained by our enforcement mechanisms. They call tax morea, more or less the social norm we share that, if everyone is chipping in, i should do my part too, right . So even when it actually comes to putting the money on the table americans are good at being taxpayers. All right, so americans see tax paying as a civic responsibility. They send their checks to uncle sam. Here is another surprising truth. They vote for tax increases. Half of states have a mechanism which voters vote directly on legislation. Many are from states where that is common. Im from california. Happens far too commonly frankly. In those states over the last 15 years it is pretty common to put a tax increase on the ballot. As often as not, those tax increases passed. Voters are voting to raise their own taxes. It is not just one kind of tax. I thought this was cigarette taxes or Something Like that. Theyre raising sales taxes, progressive taxes fall heavily on wealthy and corporations. So if americans see tax paying as civic responsiblity and even voting for tax increase, why is taxation such a political controversy in this country . In short i think the answer being proud is not the same as being happy. But what americans are upset about is actually worthying about for a few minutes. I think you will be surprised. If you ask americans what bothers them most about taxes only 7 of people say they amount they personally pay. Let me say, 7 . 14 of people actually say theyre not bothered very much by anything about taxes. Im not one of those people. Im amazed by them. At minimum we agree the amount you pay is not primary motivator. Only 7 of people think that is big problem. By contrast 3 5 of americans say wealthy or corporations, not paying their share is the number one concern about taxes in this country. Another 4 of people say theyre most concerned that poor people are not paying their share. This makes sense because if we see tax paying as civic duty that we all share, as something so important to who we are as, such an important aspect of being a citizen and being a contributing person in our country, of course were angry when we think someone not doing their part, we think some unelse is shirking. Of course it is not easy to know how much other people are paying in taxes. For instance, you know, pretty common for people to have huge at the end of the day misperceptions about tax code, what effect it has. You may remember a statistic made rounds a few years ago, the 47 . This is the statistic that suggested accurately, if you phrase it exactly right, about 47 of households who filed a federal income tax return got back more money they paid in or ended up at zero. 47 of households had net income tax responsibility at end of the year. That was fortunately remembered and repeted, half of americans dont pay taxes. You have to forget about things we all know, existence of sales tax or property tax or payroll tax for Social Security and medicare. Yesterdayyet this false version of the statistic made rounds and had a pretty big impact few years ago. Far from only example of people misunderstanding how tax responsiblities are distributed. For instance it is very common for people to believe immigrants are not paying their share of taxes. Attitudes who counts in this country as taxpayer replicate longstanding stereotypes who works hard. As we all remember from things like the welfare queen, right, we know these stereo types that dont work in this country are deeply racialized. That travels directly through today. We see it how people think about who really pays taxes. Second part of my book talks about limits of our community, right . People are proud to pay taxes supporting community but dont always see everyone in america as part of that community. You i talk a lot about that but i also talk about a taxes paid by the poor. What policies might raise taxes on rich. Of course where all the tax money is going. I would be happy to talk about you all of those things in the discussion. It is uncomfortable truth we need to grab bell, politically educated people have misinformation about policy and that misinformation is hard to take their values, connect them with the right policies that would implement the things they want to see in our politics. But i want to leave you with a different question. If i have convinced you that americans are not kneejerk opponents of taxation, if i have convinced you that americans see tax paying as a civic responsiblity, as patriotic, something we must all do to support one another, if i have convinced you of that, i would like to think about why it is we do not he see those attitudes replicated here in our government in washington. Thank you. [applause] i would like to ask our panelists to come up here to join me. While everybody else is being micked up, was that the most uplifting talk youve heard in a think tank in a very long time . [applause] i wanted to just read the first paragraph of vanessas book. By the way only 1182 wellwritten pages 182 pages and wellwritten appen today sees if you want to read them. The first paragraph is as follows. When i tell people opinions about taxation their reactions are predictable. Officers a pained look passes across the face of my interlocutor as she asks me about my presumably dreary work. Second he or she inform me, americans hate taxes. Americans are angry or selfish or shortsighted prefer to be selfsufficient and intrinsically antigovernment for one reason or americans do not want to pay government bills. As we heard that is not true. We have special reads from a Dear Colleague of ours who lives in the california, tom mann, several years ago wanted to form an Organization Called willing taxpayers of america. When i heard about vanessas event he sent us a note from california how grateful he was that we were having this meeting here today. I want to introduce heather and frank and ask a broad question for each of them to get a chance to respond to vanessa and her book. Heather boushey is the deck sieve director and chief economist at Washington Center for equitable growth. They focus on economic equality in public policy, employment, social policy and family economic well being. Her latest book, is finding time. The economics of work life conflict published by Harvard University press. She writes for the New York Times. Has room for debate teacher, appeared on all sort of networks. Fox isnt on here. Bloomberg, msnbc,bs. She served as chief economist for Hillary Clintons team, center for american progress, joint Economic Committee for the u. S. Congress. Center for economic and policy research and the Economic Policy institute. Frank clemente he is executive director for americans for tax fairness. He helped found the organization in 2012. He was previously Campaign Manager for the strengthen Social Security campaign, coalition of 320 organizations. Prior to that he managed a melt Care Campaign for the health Care Campaign for Communications Workers of america in support of the Affordable Care act. He was issues campaign director, change to win, the labor, the labor group. Public Citizens Congress watch. Senior policy advisor to the House Committee on government operations. Issues director for Jesse Jacksons 1988 campaign. You wrote a book, keep hope alive, a book about that campaign. Let me start by asking a broad question. Vanessa you care a lot about equity. Tell us a bit what you learned from vanessas book as to what this tells us about inequality and its relationship with taxation. Im going to ask frank broadly the same question. Frank said there was an important lesson he learned from vanessa. I cant wait for him to tell us what it is. But why dont you start, heather. Thank you. Thank you for writing such a great book, vanessa. It was a real joy to read. Im going to take a moment to one small brag on her which is that the Washington Center for equitable groth is grant making institution. In our first round of grant making vanessa was in our first cothe heart. We could not be more excited to help you support this research that is so important for the questions around equitable growth. So, couple things that to me really striking in the book, visavis equity. In the first place you talked a little bit about in your remarks that this idea that people feel that paying taxes is a civic duty, that they think that the tax system should be fair. And in most, definitely qualitative, you have voices of different people but the sense that the taxes should be progressive. That what makes them in a sense in terms of fair and, yet, i think that it is what the next step, i think it is hard for folks to really connect between is how, fairness of the tax system isnt just about the fairness of whether or not you are paying your fair share versus me, what it is were paying for and broader implications for Economic Growth and economic stability. Take these ideas that you work on in your book, how do we make that link for people and how do we make that link for policy make as far as you ended your makers. You ended the idea hard to connect misinformation from to policy, and how if you have misinformation to connect policy to values. People dont have the way our tax system is structured enhances inequity and does not promost growth in the way were often told. It can i would have imagine about how feel about whether or not the tax system is fair. Let me give you an example. Something that we work with a lot at equitable growth, his coauthors, they have done some research looking at whether or not there is room to increase taxes at the top of the Income Distribution where of course over time, sidebar here, over time weve seen the marginal tax rate at very top of the Income Distribution falling, 90 in the 1950s, 70 in 1960s. And 39 at very top. Rates falling for families at top yet economic evidence there is lot of room to increase rates at top in ways that are actually only promote fairness but will promote Economic Growth. Weve been told a story, which has been pushed by the economists that we need to keep taxes low at top because that will affect the work incentive of the very, very wealthy. That increases investment in labor supply that makes economy grow. A basic argument we hear a lot out of washington. Well hear a lot of that over next few months, yet at the same time, the tax rates at the top, there are other factors that affect whether or not people work. Not just the labor supply question. It is also the question of whether or not you are using labor income versus transferring income into other income or business income and whether or not those tax rates actually change behavior, and what this research by sires, shows, most important factor having lower tax rates at the top, it changes incentives to have higher salaries. So it creates the conditions for seeking for those at top. Because it creates greater incentive for their corporate boards, when they get together to give you you know the ceo, of this company and one at this company, an give very high salaries because they get to keep more of it, which is actually not leading to kinds of productivity enhancing things we want to see. Now that is complicated little story there. To figure out how to connect the dots between that sense of fairness in terms of, we want a tax system, i took from your book, people want a tax system that is not only fair but is fair but doing right by their communities. The way were talking about, taxes especially at the top, it is sometimes about fairness and also about growth. How do we work to change that in peoples minds . This is question for but a big thing came out of my reading of the book . Thank you. Glad you focused on that because im tired of argument here in washington, we need to give rich people more money so they will work harder, poor people less money so they work harder. I dont know where the logic is. Frank, tell us about the big lesson here. I will ask couple questions about vanessa, a dear friend a political consultant in the audience. Im going to ask about a certain skepticism that i have a hunch exists in the world of Political Consultants about your thesis. Go ahead. So, for the last five years the hat i have worn on taxes, created to determine our name, pollster guy from research to determine the name of our organization we actually did a whole bunch much focus groups. Not just to determine a name. We did a poll and what came through loud and clear what the public felt was tax system was grossly unfair and it needed fixing. We knew that then prior to Elizabeth Warren running for president , everybody felt system was rigged. She wan a election cycle too early. She did run for president. That was freudian slip. I was saying when she ran for senate, actually. You remember the first speech, video of her first speech, fall river, massachusetts actually. My hometown. The room was packed talking about the took that speech and put it in front of focus group and tested it out and so, you know, this feeling about the unfairness about the system pervades the culture. And it is on both sides. It is why Bernie Sanders does well and donald trump does well. It is a populism that is out there and that, from our point of view, from the tax point of view i think is very profound and very helpful. I think the thing, the obvious finding was a little bit shocking to me only because i have not, only time i think about the the civic duty part of this is kind of when tax day comes around every year. In fact it was this year, part of the tax march effort going on april 15th. We were actually writing principles for the tax march, and i wrote a principle for what tax to pay. I got this whole thing of around civic duty and you it is time of year and it is to, it is common good. And, but it is, a language i havent been using. Not used it in our political advocacy work, lobbying work, type of education work. The reason it was important to hear this from me was, because it is a place of Common Ground i think between people of different ideologies. So much of this tax debate is about the role of government. Finance you funnily flows from do you believe in government, do you believe much more in the private sector. And what is your relationship to the government. What do you think the government ought to do for you, for communities on your behalf or whatever. And, but, then light bulb came to me, he boy, if we do have that kind of Common Ground, says how far we got away from that place. How there is probably, this country used to be united around that Common Ground, whether you were a democrat or republican. What happened is, frankly one side has what i call the tyranny of theology on taxes, and on government. We cant get through that to get to that place of Common Ground that you found is where the public is. And so i think, it is partly, our education program, our work needs to remind people that we are in this together. Taxes are something were actually proud of doing because of what it means for us. Weve gotten very far away from that. We need to do more of that. Thank you. Frank, thank you writing this book. I write a column for the Washington Post was falling on april 15th. I couldnt resist writing a column under the headline, in praise of the irs on april 15th. It was basically if you support our men and women in uniform you have you to support the men and women of the irs. God bless them i still get stopped by irs agents, no one ever taken to write the column before for some reason. I remember that column. Two questions, question one is, you know which we talked about before we came in, which is, you said half the time tax increases win, half the time they lose. Under what circumstances do they tend to win . Under what circumstances do they tend to lose . If you have any comment or is it, random but probably some particular. Also the other is, this is the political second question, you are not old enough to remember but i am, Walter Mondale promised to raise taxes in 1984. Most democrats saw this, democrats saw this at the time as a big mistake. Reagan certainly went after him on that. I know a very few Political Consultants to suggest to their candidates they go out and tell voters im going to raise your taxes. What is that analysis in light of your findings . Put those two political questions together i would be grateful. No do better when you make it clear where the money is going. That seems very straightforward for something that was unclear. Obviously it is the case but it is not quite reasonable, where it was going to go. They do well, tax increases what people really like. Things that are most popular, local services and things like schools and roads and bridges, less remembered but significant, meditation and all those things and public safety. These are issues people think taxes should pay for and are willing to pay for, pay more for services. That is the take away in terms of measures that do well, make sure what they are getting in return. The second part is related to the first. I told you how cash specials have been doing for the last few years, 50 of the time they pass. That is a striking change from the era of people like mondale. If you look at the last we 4 years there has been an increase in retirement, one in 5 measures to increase taxes at the ballot box for the voters. Not the there are more of these measures but very up and down, what has changed is their success rate. People are better at explaining what it is going to do, they are doing a better job explaining what the money will pay for but anyway we are trapped by a political moment that happened, the tax revolt. We remember this era in california having grown up in california, proposition 13 that caps property taxes is a salient political recovery be has a continues to limit what california can spend today and cause problems for the school in that way but this salient political memory from the 1970s, people sometimes forget given we have gone from one in 5 to winning two of these measures passing, have forgotten it might be the case that we need to reexamine and not use the advent of the reagan revolution as our pinpoint. I do Empirical Research in 2013, the 2013 elections. The midterm elections we documented as much as we could, in the congressional races, contracted with a service to get the information and what we found was shocking to me, twice as many ads were run by democrats against republicans as republicans, usually think about republicans bashing democrats or tax and spenders, in that race it was democrats using the tax issue to their advantage and because it represented where the public is on this great system of fairness and the offshore issue the public feel strongly mother since the corporations are shipping jobs and profits offshore and take advantage of loopholes, they feared deeply about that. That is where i thought democrats were running full throated. Obama did as well against mitt romney. That was the key thing, taxing the rich, that was only the top 2 . I think i always criticize to me the democrats have their hands tied behind their back in this debate. Republicans say this is foundational theology about taxes, democrats are half in and half out. They are not full throated about it, taxing the wealthy, taxing corporations, lots of reasons. Until both parties gain the same level of passion, cant achieve the policy change we want to achieve. Let me note democrats didnt actually do very well in the 2014 elections. I dont believe there is a link. I thought you would say that but i wanted to point out the results. I was going to ask, that debate is even more complicated because middleclass families have not had a raise in so long. The last 40 years you see the growing disconnect between productivity and wages and family income. We quickly saw this in the early 2000s. What i am watching for as we go into the tax debate is the sheen of a small tax cut for the middle class is struggling on top of a very large tax cut for those at the top but because it is hard for folks on both sides of the aisle to not acknowledge the real struggle the middle class is having, we walk into that conversation as well, that makes it hard to say we want a more progressive tax system or raise taxes, make that argument where the other side has this little sweetener to the conversation based on real struggling of families. The middleclass tax cut issue what i want to ask, you build on what you said, explore that and also what do we learn from Vanessa Williamsons book, you can talk about the first part, what do we learn from Vanessa Williamsons book for this coming fight and i went to come back to Vanessa Williamson on something, talk about the middleclass tax cuts. Spending a lot of time talking to folks in legislative advocacy work about middleclass tax cuts and whether it is a feature here. Republicans will run, the tax bill, despite the fact, trumps plan gives 6 trillion of tax breaks, half of those tax breaks go to the top 1 . Believe it or not, i know you want to believe it but by the 10th year, 99. 6 of the benefits of the tax breaks go to the top 1 . All the tax breaks go to the richest 1 and the democrats want to be for something in this debate so they think okay, there are two challenges with that, people havent felt they had a raise so more money in their pockets. If youre making 50,000 a year, in trumps plan you get an extra one dollar a day, a millionaire gets 1 million extra a year, somebody making 50,000 makes an extra dollar a day under trumps plan. What can you buy for one dollar a day . Not much. Secondly, we have a revenue gap in this country that is quite profound. We can talk economics for a minute, the flatline, revenue as percentage of gross to mystic product which is how these are measured is 18 , for the next decade. Spending is at 21. 5 , 3. 5 percentage points, going up to 23 , the baby boom generation, retirees healthcare. That is 5 percentage point gap. Republicans want to cut cut cut and not have any economic security, Retirement Security or with my organization advocates, raise revenue to significantly close that gap. That is where we need to go. If you are advocating middleclass tax cuts, that gap is going to grow because this will become a bidding game between both parties. What Vanessa Williamsons book teaches us is evidence i would like to hear your view as well, what your book teaches us is there is room to make those arguments. I dont think we tried hard enough to make that argument. We dont need another middleclass tax cut. What we actually need is to raise revenue and there are places to take that, the tax cuts at the top. Because we need to make these investment in the united states, a few really compelling things, we know investments in infrastructure have been and continue to be highly popular. People understand when their bridges fall down you need money to fix them and they dont want trains that dont work or crash because the rails are not kept up and so that is one. A second issue we dont talk about enough, when we talk about republicans talk about wanting to cut back benefits for Social Security beneficiaries or uping the age forgetting medicare or cutting medicaid, those are expensives that will be borne by someone. One is to have it socialized over a lifetime, all of the American People, paper out of this fund to Social Security or these other programs or it will fall directly on families which is going to have a negative impact on families available to be in the workforce, if you have an aging loved one move into your home or spends more time caring for them, this is affecting the Labor Force Participation rate of American Workers in their 50s and 60s when they need to be working and saving for retirement, it drags down family income, makes the budget even tighter but all of that is Economic Growth. What we are not doing is making the investments that will make it a vibrant 21stcentury economy. We are not making those investments in infrastructure and all the things we should be doing. What i take from your book is we need to be doing a lot more to make this tradeoffs, and less im an economist totally guilty of this, less of the abstract we need to raise taxes because it is progressive and more concrete this is why we need to have fair rules of the game and we are using tax dollars to make capitalism work better, the people benefiting most from that Economic System should be putting more skin in the game because they will benefit the most. The middleclass tax cuts, the answer is to change the conversation, you dont say to someone who is struggling we dont care about you, focusing on how to create good jobs, this is part of that puzzle. You are the first guilty economist. To respond to what is said before, for a lot of us, for me, everything you say about the need we are all in this together, tom paine idea that individual success owes a lot to the society in which we live and work and raised but that is beautiful language that resonates. When it comes to taxes, the world that gets used in government, a lot of surveys show how Government Works. Some of that is the result you can argue with conservative propaganda. Some of it is not working well for a lot of people and government is the Natural Force to be those create a challenge, and paying for common life. To respond to what is said and take that one on too. They are closely related questions. In my mind the argument people want to make is we should be able to recognize a tax cut results in a shortage of services, a connection that could be clear, we didnt have the dollars we needed to fill in the pothole and it always went somewhere through tax expenditure, we would like to make that case that schools and roads and hospitals, could be better if we put in the cash but the challenge in making that case is people have a deep concern about government waste and what people mean by government waste is actually used as a statistic, what percentage of federal tax dollars do you think is wasted the average answer is 50 , half of all federal tax dollars are wasted and experts tell you it is 7 of the budget, and that is how we talk about that. What they mean by government waste, with general concern, talk about entire programs, that is usually the military, on the right and in many ways a means to talk about waste, it is not any efficiency, it is a bad idea, it is wasteful but the other thing people talk about, what they meant by government waste, talk about plutocracy. They talk about government operating on behalf of the very wealthy and living lives that are completely alike average americans to go places and they dont have my Health Insurance or lack of Health Insurance, that is a common thing for people to say when asked about government waste so that suggests to me is a problem we face the people dont trust the system by which we allocate dollars American People are giving, and profound doubts about not just the outcome, and that creates the big challenge that there is a tradeoff getting wasted anyway, how much it matters, little tax cuts and also having faced contributing dollars and voting, that you should have. A very fundamental foundational problem with that, the campaign finance, all that sort of stuff, little nuggets in the book. And pulling on it. Very supportive of a flat tax in Public Opinion polls, the same folks, the tax fairness issue they dont understand what they think the loopholes are so bad, corporations and the rich are doing it. A flat tax, they would be better off, society would be better off. It is profound, we know that. This election, until we get over that hump. It is price in the role of government tearing government down a lot. That brings down, so much the disposition of the public is there, the lack of trust is not able to be bridged. To raise the gas tax, to rebuild roads and bridges, Railway Systems across the country, both parties were saying that, i will pay an extra quarter, 5, . 10 in gas taxes, that is not the dynamic we are in. The gas taxes, one of the problems is tax visibility which came up for, people do not know what the gas tax is because it is not obvious. It is hard for people to make a calculation about the gas tax high or low, should talk more about that. It is a good example for any reason. And they can function, what democracy is not functioning is a great challenge. One of my favorite charts in the book, it is in the preface on page xiv where you show increasing state dollar measures, passing over time, it goes up. They are likely to pass over time but one of the questions, they asked vanessa a question. What this get that for me is people really value things they conceal and touch and that would push it to having more of these conversations at the state and local level, which is not what we talk about in washington dc, people are raising taxes, increasingly in favor of Ballot Initiatives but having a conversation in washington, and is that a good reading of your book . Peoples for you about their state and local schools, local school is great but american schools are failing. That on the one hand is definitely true but at the state and local level, they are bigger, mathematically true. At the same time we face the challenge we are tribal lands politically and geographically, that is a challenge i alluded to at the end of my talk, the Positive Side of this, actually in our politics we dont talk about duty and patriotism in that sense of what are you going to sacrifice, the oldfashioned style of talking about our political life so it was interesting to me in my interview that everyone has come up with their own language. If you ask some people about a subject they have a talking point or two ready. One thing you hear about, if you dont want taxes to punish work, so many people, it is captured an important sentiment, they all had the same word. Just as many people talk to me, more people, everyone talked to me about the idea of community, taxes show i am responsible for my community but they had different ways of talking about it. Them carry about their neighbors, no man is an island, they fall back on whatever metaphors they could pull together to describe fellowship, the since we are in it together because it is not common in policies now to give people the language to have a shorthand. They dont have a shared language to express the feeling and that is an important part of the role of politics, to give them the language to express those things. You are saying its part of something in me and i will go for questions, we have mikes going around the room. I want to invite our poster friend to ask a question too. You talked about civic duty and the like and what it made me think of it ask not what your country can do for you, ask what you can do for your country. John f. Kennedy said that in 1961. That was the high deck of the greatest generation. It followed a period americans believed the government had outdone the depression and won world war 2 romantic and there was a Public Confidence in collective endeavor that we had been losing starting around 1968 or 70. I think we can see part of it is how in the world do we ever get that back . We dont want to have a world war. Maybe a very unusual time but there really was a civic sense, years ago people felt a palpable stake in common endeavor. It was not just in out realistic thing. I have to toss that to the panel and open it to questions. One of the challenges is the 6870s was the low point of any quality in the united states. And one of them, the in vietnam, excluded from Economic Growth, Racial Justice movement, now this era where we have any quality, in the 1920s, pulling apart and people congealing the fact that it is a problem. Many trump voters frustrated that somebody, america is growing but the flip side of that coming together, the frustration, that is the challenge today, the negative experienced to make that into something we have a common purpose around. Our hope lies with the rising american electorate, essentially the obama coalition, millennials, people of color, very diverse population, people who have a different attitude about government, the current dominant wage cohort out there. As we know, the rising american electorate, the biggest voting block in the last cycle. A much greater Comfort Level with government, much more communally oriented and engaged through the wired world. They are more comfortable with government spending. Less secure than previous generations. And coming back. A critical question. And democrat have destiny, american Political Institutions have been structured and historically to this day to limit the power of maturity. Fundamentally a part of the plan. Our constitution continues most obviously in the last election, in general i would be hesitant to put my confidence in simply having the most potential voters because it is quite clear in a number of state they are willing to change who votes before they are willing to let majority rule. Alongside that, the broader question of how to create a sense of shared fate, what that generation had. At the end of the day all had to do together and through this contraction of our economy. Couldnt just buy your way into a life that had nothing to do with other americans. I had my own take on this and i think there is Something Like a world war that we face and that is Climate Change. I know that sounds a little like you are never going to convince conservatives that Climate Change is causing droughts in Rural America and every farmer notices that. Climate change is flooding our rivers, flooding our coasts, a danger to cities and rural people, danger to people at every economic level, undoubtedly most dangerously poor, but Hurricane Sandy let us all know new york is one city. Looking forward what i say is we can identify that has the shared risk that it truly is. It might be, it could be Something Like world war ii level commitment. My true level of pollyanna optimism. Catastrophe before you have assured of those. Maybe we should start a cable channel that shows nothing but 1941 movies. Or weather disasters. A bunch of hands up. Lets start in the back, the lady in the back please. I am jumping out of my seat so excited about this conversation. Elizabeth gaines, i have been working with your colleague on this notion of new american localism, kicking off the childrens funding project and two quick facts, i tracked 14 ballot measures on the local level in places like rural ohio, suburban kansas city etc. This november, 11 of those places elected to tax themselves to pay for childrens services. People literally coming out that voted for trump and voted for the Children Services fund. That is very promising to me. The other thing is there are eight Children Service councils in florida, many of them had to go back for reauthorization. Very popular. Do you talk about children in your book and any advice for me as i kick off this new project . Well, thank you for a great question. I shouldve talked more about that. It is one of those things that does cross all kinds of device. The secrecy with which people say our children. They are all her children. That is really amazing commitment. You see that in people without children to Public Education and be willing to fight for schools because after all we need to look after her children. Dont you have the repeated bond issues and places where you have substantial overpopulation and kids are not in school anymore . You know, it works both ways. I mean it doesnt always no, its a 50 50 shot. So you know i love original sin is the only empirically verifiable document in the christian church. Always important talk about human frailty. Sir. Thank you. Thank you, rick spivack with economics. I learned a lot. Im very interested in the remarks about peoples perception of tax fairness relating to what is the relationship between what i pay in what they get. I wonder if our tax mechanisms dont play into that. And what they mean is we tend to rely upon in general taxes. I think from simple sales taxes. The nice things politicians love about sales taxes you can raise the buy a small percentage and rake in lots of moolah. The people have no concept of how that money gets spent. I think in particular, when it comes to water and sewer, most of us pay a per gallon fee for the water we drink or the toilet to flush and it seems they are the more you drink with the more you flush, the more you pay. We could pay for water and sewer with the sales tax, but if we did, what people have any incentive to conserve water when they see a leaky faucet . Today they see water going down the drain. If we pay with sales tax from what they go by something he didnt mean for what they were wasting. Probably not. I wonder if theres maybe a lesson for politicians that if you want the public to understand and support taxes, we have to create some better linkages between what people are sending in getting and may be moving away from general taxes towards things like user fees and value tax where people pay proportion to what they get. Let me append one in democracy journal, which i have an association. We sit on the whole idea of tax receipts, when people get the refund but also ought to get a onepage accounting and what it went to and what it spends on. The Public Education so people get where it is distributed. I am curious. Its an entirely different question, but its related to the issue of knowledge. I think there were basically two questions. One is the question of making benefits visible. That clearly is an important thing for government to do. There are many ways that can be done. I think at many levels attacks are sheep which showed tremendous successes on Social Security. They received a little green steam and amateur on Social Security benefits. I remember having received, but actually had a randomized trial to say and measure the impact of people finding out a statement on the Social Security. Your switcher benefits look like and if you keep a likely, itll happen. It naturally increase the knowledge of the security. The confidence in Social Security and the misinformation about what is happening with Social Security. The fact that we can make the benefits to government visible is important for two reasons. One because it would be good for people to know what benefits they are receiving so they can judge those, but also because people are just consumers. They are citizens. The government was doing a job. The social policies in the tax code and we also lose that connection. The second point you make about feeforservice basically, benefits principle. We can disentangle those. Many places where fee for service is a good idea, taxes operate in the same way, particularly for people. But at the same time, and having every tax dedicated to a particular purpose. First of all, pretty regressive. And secondly, im it doesnt get a point for our democracy and at the end of the day, thats what we would like. We would like to be able to trust our democracy to advocate money from a general pool. I would prefer that fundamentally believing we had to have each and every service paid for separately because they couldnt trust lawmakers to make those judgments. There were two issues going on, both of which are really important. Whoever wants to come in and some of the united way inserted big philanthropy declining as people give more money to very particular thing that they want in my understanding is one of the net effects of that is less money ends up going in the richer and poorer parts of town and you need some general fund that is not user fee based in order to achieve a level of social decency in the parts of town that dont have a lot of money to spend. I think it is a larger part of the story. And you guys want to come in . I want to go to the side of the room and then i get some other voices on the side geared i want to comment on the question about people knowing what benefits and taxes, the benefits they are receiving. This is one question that i feel like a social scientist seem to understand, but policymakers dont. Or that is my own personal experience as i found it difficult to explain to folks in policy why that really matters with a lot of pushback on that. I wanted to make a little bit of a plea that if anybody in the room are listening think theres evidence, we should talk about a little bit more. Too often theres both how you do something really efficiently, which may not go well for showing people the benefits they are getting, but also sometimes pressure to do things to employers, which really doesnt scare that for people and it leaves you with programs that dont have a constituency. People dont actually understand. It would be nice if as we are having this tax debate over the next few there were more rising up having a conversation about how important is for people to see whether tax dollars are going. Just a little plug for all of you out there. Is a really good and to do that. My quick comment on your question is messing with the politics we have now and thats absolutely one direction. The taxis into share the wealth. Ill use the redistribution word. If we got into this tax, the folks we lose are the folks most in need. To redistribute wealth. Okay. A user fee on wealth. Its just not the same. [inaudible] thank you. Sounds like henry george. I have a question about the Public Perception of fairness and when people are talking about fairness, is a notion that the system is good but its been hollowed out or that the system itself is not working . In other words, is 39. 6 and 35 of corporations, are those marginal rate, dont like the ability to hire tracers and lobbyists to lower your effective tax rate or is there some deeper value people are responding to that date being 50 is a good raid or income tax unfair or something more fundamental. Thats a great question. Theyre several parts i want to talk about all at once. First of all, and that, and at the american support for taxation comes Something Like 60 or 70 and you can ask that question different ways. You get results either way. You can ship a result because of the highly contested partisan issue. Overall, american support of progressive tax. But there is some serious gaps in peoples policy knowledge. Use the phrase marginal tax rate that is entirely nebulous idea in the common understanding that if people do not understand the tax rate applies only to income in the rate below. Or one time taxes were at 90 at the very top. They think thats your whole income. Thats a very common misunderstanding that undercut support for high tax rates because thats how it proceeds. Nothing would be interesting to find out a way to figure that out quickly. That is a policy problem in terms of explaining how or income tax system actually works. Its commonly believed in and made this point already that the graduated income tax in principle, people should pay a larger percentage, not just a larger amount. But they also commonly believe our Current System is undermined by loopholes so what results are not as a willingness to trade lower rates for closing the loopholes. Clarity on what most of us do which is lower revenue. They think will have all this new money and theres not going to be a problem if we lowered the rates. And on the corporate side closer to accurate than the individual side. So thats a common misperception for a flat tax. Thats not the most popular plan in america. Several reasons because the flat tax sounds like equal commitment from the citizens and were talking about taxing being something citizens do. Wouldnt it be great if that could be shared equally . That is one motivator behind the flat tax. They often talk themselves out of a flat tax after a minute or two because they talk about how it applies to different people. The question of a flat tax with no loopholes and guys who are not taking any fancy rate you are talking about wind up having to pay and actually come out ahead. That is largely how thats understood. A lot more confidence about broad symbolic ideas that we should pay more than what the number should be. Another example of that is the question of off shoring people feel very strongly as he said about being hidden overseas because it resonates with the symbolism of something patriotic to do. The fact that theyre literally hiding the money outside of the country make her fix fence. Those are the kinds of policies that stick with people because they said with this understanding of it. When you go too far down the road of specific numbers coming up to provide so much information that its almost impossible. Youre not getting their opinion in the wild anymore. Youre getting there painted with a certain set of facts they did encounter our politics, which provides core facts. Maybe im crazy, but when we got those, it used to be that we would get the newsprint tax forms in the mail come off all of the forms you would then fall out. I dont get those anymore. They had a pie chart of where tax dollars went. But also, my other comment is if you have this big pamphlet entitled as tax tables, it made it much easier to understand, okay, that is how i learned what marginal tax rate not because im economist and i thought it was somewhat interesting. But im just pointing out that in a small way that to educate people, that we dont do anymore. Maybe there are other ways that we could be doing that. How much time do you have left . I forgot to bring my 10 minutes. The gentleman in the back row has been waving his hand. And then a couple of people further outbreak here. Let me take care of this side on this round. You start from a certain and i will bring the mic. Ill be quick. How do people feel about using the tax code to sort of behavioral engineering encouraging certain behaviors and discouraging others. Im a little disappointed Grover Norquist on the stage. I am trying to get a set up an event with grover. Thats on the same. If youre watching. Make sure you bring that up, too. But i think a lot of what that nasa is talking about his narrative. I dont think we have created a narrative about taxation that people can understand and gravitate to. The narrative that weve got now is all topsyturvy. For 30 or 40 years weve been told that if we get people at the top of many that we are all going to at the bottom. The only thing with them is misery. For example, i dont think most people know this. Companies like walmart and mcdonalds actually have seminars to tell their people, if you cant make it on the salary we are paying you coming or some Government Programs you can go to. The waltons are worth 40 billion. We are subsidizing their employees. We are subsidizing their wealth with our tax dollars. If thats not insulting that doesnt get people up, theres no hope for this country. The tax simply on companies that sort of disproportionally his government benefits to subsidize benefits. The gentleman right behind their. Just a quick question and comments. The fairness has been around a rich and the poor, tax rates, loopholes, shelters, fair share. Has there been any consideration or in your research has anything come up about tax simplification . Equal treatment before the law such as, for example, getting rid of file extension, deductions, special treatment in the tax system, treating, for example, all income as income regardless of its source. I only say this because i get a tax form every year. If you did that for me, my taxes would be on a postcard because the irs knows all my sources of income. They know the rate that i am supposed to owe. And that actually would impact a huge majority of people who pay wages and have their taxes withheld. The question for the gentleman in the back coaches about using the tax code to accomplish things. One other idea, president obama talks about this in his campaign and none of the tax preparing firms like that, which is in fact, most people pay on the short form and you could actually send people a bill on their taxes where they wouldnt have to fill out anything. The people who complain are the people who get the most benefits out of the tax system. If those things werent there, they would pay, in many cases, higher taxes. It is very odd. I think some education is harder than it looks. Anyway. All of these questions are good. Look at the reasons, the messaging that the republicans, that paul ryan used in its blueprint always lead to the simplification. And they are actually not talking about getting rid of loopholes, they loopholes, making the system fairer, sort of coopted our language im not. The simplification can appeal to everybody. Fundamentally who uses all the loopholes. The folks at the top. I think we have half of the narrative that is successful or not is the taxpayers narrative. We have trouble on the other half, which is what you want to do with that money . How do we need to make america better . That is where things fall apart for ross. That is where things are more challenging because im all the stuff people are hearing about government and about how the system is rigged, really working on behalf of rich corporations or on behalf of big unions. You know, so it is that problem. That is going to have to shake itself out. When the pendulum swings back, seems to the more liberal Progressive Side of things, those will shake out. About using the tax code to get things done. I think that has, in other talk a little bit about this already. Were making the tax code, even if there were benefits to working people, benefits youd like to see people have, tax credits, things like that. It makes it hard for people to see what government is doing and convinces them that taxes are complicated. If taxes are complicated, i know who is getting the real deal here. The fancy accountants and lawyers, not me. So the limitations are in a stunning. In a survey an interview saying its almost impossible to disentangle. The complexity of finding their own taxes to the certainty rich people were paying their share. I have to sit there and remember my deductions here and there. Youve got the earned income tax credit, all those things. Every time they are thinking about remembering those things, someone fancier is getting bigger deduction and so it creates loopholes in all of these things. People are experiential learners in the time they learn what government does good right now the lessons they are learning are leaning to some very wrong ideas about how our tax policy works and how our Government Works more broadly. We need to think about that when we are in the systems and trust that people here in their would be nice to respect them with the information they need and decisions as citizens. If you take away the homeowner deduction, every homeowner would be furious. If you take away the state and local tax deduction, everybody in high tax states would be furious. It is in the eyes of the pay your. I cant resist putting you on the spot. One of my favorite is here for us. One last question before we close out. Vanessa, you talked about sort of the positive values associated with identifying taxpayers. A lot of the policies that frank and other groups will be involved in will be doing essentially the reverse scenario. That is, trying to stop efforts to give new Tax Advantages and breaks to corporations or high income individuals. Im wondering if anything you have heard in your interviews would give guidance on the kind of language to describe companies are wealthy individuals who attempt to reduce their tax burden or avoid their Tax Obligations entirely. What is the negative language, sort of the reverse of civic virtue. Yeah, that is a great question. There is a really great Political Science work done on how people understood the bush tax cut, which i would have recommended reading for anyone who wants to think about the politics are likely to be this time. One challenge of course is its very hard. And very busy. And so, many people are trying to see how taxes work. Its not that surprising at the end of the day that smart, educated people are wrong ideas did i think thats a big challenge. They sound pretty good. Closing loophole sound pretty good. Its not easy for people to get a clear answer or to draw the connection between the tax cut over here in the services that dont exist in my community over there. I think those are real challenges. At the same time, you know, part of this to me is just about having, you know, the kurds to talk about taxation. I think often people dont have the courage, but if we think we should have a democratic form of government, taxes or how we pay for it. It is in a democracy investing in our government. So, you know, having the confidence, having courage of your convictions about why we play in the first place and what that is doing. The equity is supposed to be creating for the services it is supposed to be paying for i think you can tell when you believe what youre saying. To me, and i dont think it is about finding the perfect set of words to say. I dont think its somebody who actually believes in saying that. But yes, on this particular fight in the next few weeks, i would expect that the overseas question is one that will resonate people on the right and the left. The idea that companies that have jobs overseas and want to keep their money overseas, too, that is offensive to people who are paying their taxes and cant hide their money wherever else people imagine the money is hiding. And so i think it also resonates with the larger idea that tax paying a something citizens support their community and their country. If you are not doing that, it implies that you dont share our values, and which are not doing the teacher got it thing. That is something that is both true and resonate with people. And a taxpayer feeling terribly excluded if i had done time, if theres a question i want to ask it. He kind of pitcher hand down so im going to reward you for that. Thank you did you talk to in the beginning about how americans kind of attribute the label taxpayer to themselves and how that is kind of shorthand for an upstanding citizen. We seem especially in this last election about against people who they dont kind of label as a taxpayer, even though the evidence is exactly contrary to that undocumented person to pay more in taxes than they receive in benefits and its kind of like they are almost ignorant to that fact completely. I guess what would you attribute to this kind of change and i guess what is the future on that . You think it will be improved or get worse . That is one of the most fundamental questions we face in general. Thank you for asking it. Its right that americans commonly believe undocumented immigrants are paying their share in taxes. At the end of the day, the fact that immigrants are doing work for Social Security and medicare, which they are not qualified to do. They pay disproportionately in sales and use taxes and fall heavily on lowincome people. They dont have the annoying process once a year to think about them. Thats exactly why we invest in understanding. I dont know when i think would be very hard to find out i dont think just telling people the facts with an emotional reality to them. Im not sure the house of the Social Security system is the way to change those minds. In this case, what we are seeing is our understanding of tax policy is a mirror in our society. And this is someone who benefit that doesnt pay it. We are seeing a different necessity now with the idea of these undocumented immigrants who arent paying taxes. And i think that is a deep divide in this country and i think that, you know, i would like to say that tax policy was going to wrench that divide. [inaudible] that way you know weve crossed across that fundamental challenge, which is living a fair economy but the multiethnic community. Thank you. [applause] i want to end. One of the nice things that nasa does through these interviews and then people wonder. So she has an appendix where she sort of summarizes all her interviewees. I want to give cassie the last word. Patsy is a 58 world registered nurse from sacramento, california. Here is what vanessa wrote. Asked if it is ethical to find legal ways to avoid paying much in taxes. Patsy says no it is not yet pardon my language. Taxes keep everything going as it should so we can continue to have people following diseases with immunizations for kids. Otherwise, we would be screwed. Thank you very, very much. [applause] [inaudible conversations]