Americans' Views on Taxes
An NPR/Kaiser Family Foundation/Kennedy School of Government Poll

It's not surprising that most Americans really don't understand the tax system, but the results of an NPR/Kaiser Family Foundation/Kennedy School of Government Poll are still surprising. "Most Americans think high-income people don't pay their fair share of taxes. Yet most Americans also want the government to dump a tax paid almost entirely by the wealthy: the estate tax."

First, some of the good surprises:

  • 80 percent of Americans believe it is more important to maintain spending on popular domestic programs like education, health care and Social Security than it is to cut taxes
  • 72 percent believe the tax system should be used to encourage things like financing a home, giving to charities and buying health insurance
  • 53 percent think it's more important to keep down the federal deficit than it is to lower their taxes
  • 41 percent support the current estate tax law, which exempts estates worth $1 million
  • Only 35 percent believe a dividend tax cut would stimulate the economy (take that Mr. Bush)

Now for the bad and the ugly surprises:
  • 24 percent believe a temporary cut in payroll taxes would be an economic stimulant (nothing would inject more money into the economy)
  • 28 percent say they don't know whether people with higher incomes pay a higher percentage of their income in income taxes (the truth is that they do in theory, but not in practice)
  • 50 percent don't know that in the past two years there has been a cut in federal income taxes (so much for Bush's tax cuts winning him reelection)
  • 54 percent believe an across-the-board cut in federal income taxes would stimulate the economy; 70 percent of Republicans
  • 57 percent support eliminating the estate tax; 26 percent want to eliminate the tax even on estates worth $25 million
  • 72 percent of Americans have neither heard of the proposal to do away with the tax on dividends or don't have an opinion about it (so much for Bush's tax cuts winning him reelection)

Not surprising, but no less disturbing, is that the wealthiest Americans have the best understanding of the tax system and tend to favor measures designed to widen the gap between themselves and the middle class:

"The starkest differences based on income are found in an examination of the responses of people in the top 5 percent of income (those making $150,000 per year or more). They are more likely to favor a variety of proposals including eliminating the tax on dividends, speeding up and making permanent the 2001 tax cuts, and changing to a flat rate system than are those at lower incomes.

They also are more likely to strongly disagree that it is the responsibility of the government to reduce the gap in incomes between the top and the bottom, or the top and the middle. Furthermore, they are considerably more likely to be knowledgeable about the tax system."

Ultimately, it will always be easier to rally American voters against taxation using populist rhetoric; its just a matter of disguising anti-taxation's true goals. Bill Gates, Sr., Paul Volcker and others have warned that dismantling our nation's progressive tax system - as Republicans have been trying to do for more than 30 years - will dismantle one of the basic tenets upon which America is built: economic opportunity.

"More than six out of 10 (63 percent) think that low-income or middle-income people pay the highest percentage of their income in federal taxes. Only a quarter (25 percent) know that upper-income people actually pay the highest percentage. This misconception is likely why so many Americans (57 percent) think that high-income people don't pay their fair share in taxes."

Give the people credit, this "misconception" is likely related to the innate understanding that most Americans have, which is that, although the wealthy pay the highest percentage in federal taxes in theory, in practice they pay much less than their fair share thanks to deductions, shelters and other means of tax evasion.

Bush's continued cuts on income, dividend and estate taxes will only accelerate us on our path to a post-democractic, post-capitalist world. Brave and new it won't be, more 1st Century than 21st Century.