The Power to Destroy

Starred review from December 4, 2023
How did the U.S. economy go from its post-WWII prosperity to decades of increasingly burdensome personal and national debt? In this insightful and disturbing analysis, Graetz (Death by a Thousand Cuts), a law professor at Columbia and Yale universities, links that decline to increased hostility toward taxation. The 20th-century antitaxation movement first began to see results in California, with the passage in 1978 of Proposition 13, which limited the taxation of property; the law was estimated to have cost California’s state and local governments over half a trillion dollars by 2000. Antitaxation sentiment was further fomented by Ronald Reagan in his 1980 and 1984 presidential campaigns, and by other Republican politicians, including Newt Gingrich. Despite growing evidence that the very rich often paid little to no tax—2016 presidential candidate Donald Trump touted his low tax bill as evidence that he was “smart”—antitaxers continued to demonize the IRS and oppose sufficiently funding the agency’s pursuit of tax cheats and evaders. Through his accessible presentation of recent decades of political battles over interconnected issues, such as the right’s fight for the tax-exempt status of religious schools and its pushback against the IRS’s 1971 policy that tax-exempt schools must be racially nondiscriminatory, Graetz effectively makes the case that antitaxation has been “the most overlooked social and political movement in recent American history.” This is a must-read for those concerned about the U.S. economy’s growing reliance on debt.

Starred review from January 15, 2024
An illuminating study of the antitax movement as retrogressive and historically racist. No one likes to pay taxes. Yet, writes Graetz, a tax policy expert, despite the hype that Americans are overtaxed, the U.S. "is a low-tax country compared to other developed nations." Of the 38 member states of the Organisation for Economic Co-Operation and Development, only six levy less in tax than the U.S. does. As the author observes, the modern antitax movement coincides with the rise of the New Right in the 1970s. It was a fundamental tenet of neo-Birchers such as Howard Jarvis, the engineer of California's tax revolt; and of the Reagan administration, one of whose architects, Lee Atwater, linked antitax precisely to racist dog whistling: You can't use the N-word, he noted, but instead "all these things you're talking about are totally economic things and a byproduct of them is blacks get hurt worse than whites." In the 1980s, Graetz notes, the antitax movement became the glue that held together various parts of the Republican constituency, and especially evangelicals, who concocted the notion that taxes were evil. Meanwhile, Reagan, who campaigned on the vision of an imagined "welfare queen" who drove a Cadillac while gaming the system, lowered taxes on the rich at the expense of the poor. The pattern holds. As Graetz writes, it is modern GOP gospel to vilify the IRS, going so far in recent years as to attempt to defund the agency. Interestingly, he adds, nine of the ten states with the highest percentage of wealthy residents who pay no tax are Republican-leaning states. Yet the likelihood of things changing is slim: American voters don't rank addressing inequality as a priority, because, Graetz ventures, "Americans want to become rich themselves." An accessible, searching look at the injustices built into the American way of taxation.

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