Like The Herald Business Journal on Facebook!
The Herald of Everett, Washington
Customer service  |  Subscribe   |   Log in or sign up   |   Advertising information   |   Contact us

The top local business stories in your email

Contact Us:

Josh O'Connor
Phone: 425-339-3007

Maureen Bozlinski
General Sales Manager
Phone: 425-339-3445
Fax: 425-339-3049

Jim Davis
Phone: 425-339-3097

Site address:
1800 41st Street, S-300,
Everett, WA 98203

Mailing address:
P.O. Box 930
Everett, WA 98206

HBJ RSS feeds

Distrust of government has deep roots; the IRS isn’t helping

SHARE: facebook Twitter icon Linkedin icon Google+ icon Email icon
By James McCusker
Herald Columnist
Leave it to the IRS to get our attention. Despite the deaths and dissembling in the Benghazi tragedy its remote location has kept it distant in the public mind.
The recent IRS disclosure about political targeting hits home, though, because it touches everyone's sense of vulnerability. In most people, the IRS triggers an instinctive reaction that can range from low level apprehension to major league fear.
We don't know all the facts at this point but what has dribbled out so far raises worries, even fears, about the Internal Revenue Service acting as a kind of a political "enforcer."
The efficient collection of taxes by our federal government is largely based on trust. Most people pay their taxes voluntarily. They make honest efforts to report their income and calculate the taxes owed because that is the law. They feel free to complain about taxes, but they still pay them, regularly, without notices, threats or legal action.
The cost to the government -- and, ultimately, to us -- of collecting taxes that are paid voluntarily is dramatically lower than the cost of extracting them from tax dodgers and chiselers. Beyond simple expense, though, the unchecked erosion of the trust on which collection is based would result in a fiscal Dust Bowl in which only deceit and corruption could flourish.
Apparently, this outcome never occurred to the great brains that thought it would be a smart thing to bring a little misery into the lives of tea party groups and other political opponents of the Obama Administration.
Broad statements about America being founded on distrust are not really accurate. Our country was, in a sense, founded on a healthy distrust of central government, which, at the time of our Revolution and adoption of our Constitution, meant the tyranny of a king. There were no elected governments of the size, power and reach of today's democracies.
The nature of that distrust in America's case, though, isn't a simple matter. When we look at the Constitution itself what we find are limitations on government, not pure distrust. The Founders and the people apparently trusted government to live up to its missions. It was not considered necessary to watch everyone in government every minute in order to insure compliance.
Eighteenth-century America had its share of brigands, rogues, thieves, dirty rats and short-changers, no doubt. Our country was built by remarkable people, not perfect ones. And the federal government as it grew undoubtedly brought a few of these miscreants on board, where they continued to exercise their character flaws in the pursuit of unworthy goals.
The difference between then and now is that while the federal government had failings, it did not have organized crime. That was a possibility so far beyond the comprehension of the Founding Fathers, and the generations that immediately followed, that they simply didn't waste time considering it.
Organized crime in central governments is pretty much a 20th-century development. For a long time, though, the United States seemed to enjoy an immunity to this disease.
Watergate changed all that. The politically-inspired break-in and burglary was a criminal act, but as a nation we could have survived it, our spirit intact, just as we had survived other misdeeds and miscarriages of justice.
What was different about Watergate was the cover-up. The original burglary was criminal, certainly, but simply a bungled effort to steal political campaign secrets. The misbegotten cover-up, though, involved so many people and reached into so many areas of the federal government that it was nothing less than an organized crime.
America would never be the same. Nevertheless there are limits to how much of that can be laid at the feet of Watergate.
The Pew Research Center for the People and the Press has put together a time line showing the history of public trust in government based on data going back to the Eisenhower Administration in 1958.
What is particularly interesting about this study is that the Watergate affair isn't even noticeable in the data. America's confidence in the federal government had begun to plunge shortly after the assassination of President Kennedy, and by the 1970s, even before Watergate, was about a third of what it had been during the late 1950s.
It is difficult to predict the outcome of the IRS investigations, but in terms of public confidence it cannot be good. It is only a question of how bad.
According to the Pew data, public confidence in government remains at about 26 percent, roughly a third of what it was two or three generations ago. How low it can go before our economy and our country reshape themselves into a very different America is an interesting question … but we may not like the answer.
James McCusker is a Bothell economist, educator and consultant. He also writes a monthly column for the Herald Business Journal.



Market roundup