“The Lord might love a cheerful giver,” a Brooklyn newspaper wrote in 1909, in an editorial attacking public pensions for the elderly. “But as for the cheerful taxpayer, the idea is impossible.” For a century, the arrival of tax day has provided an occasion to contrast the joyless task of taxpaying with the virtues of voluntary giving—a rhetorical pairing especially beloved by those who oppose the intrusion of the welfare state into realms first staked out by private benevolence.
The comparison is often wielded cynically: when Warren Buffett urged Barack Obama to increase taxes on the wealthy, Republicans sneered that if Buffett wanted to give the government more money he could go right ahead. (“He should just write a check and shut up,” Chris Christie memorably put it.) But it also expresses deeply held American beliefs about the superiority of private responsibilities to public ones. In short, an argument on moral grounds, in which voluntary action is deemed more worthy than legal obligation, is deployed to serve political ends—namely, the claim that private generosity is a more effective means of curing social ills than government bureaucracy is.
The inequality of esteem accorded to the charitable donor over the taxpayer has a long history, dating back to at least the start of the Progressive Era. Today, the gap is wider than ever, for reasons political and economic. Americans now pay a smaller share of their income in taxes than nearly any other wealthy Western nation, while taxes as a share of G.D.P. stand at fifty-year lows. At the same time, Americans give more to charity than citizens of any other nation, and the United States relies on the voluntary sector to address major social problems more heavily than other advanced economies do. In the past decade, that sector has enjoyed a tremendous boom: from 2000 to 2010, nonprofit revenues grew at a rate that was double that of G.D.P.
The gap in respect between charity and taxation also reflects prevailing social attitudes: Americans’ faith in the government’s ability to solve society’s most pressing problems is languishing in a decades-long trough; according to a recent Gallup poll, trust that the federal government will “do what is right” is near an all-time low. At the same time, perhaps no figure is more widely celebrated than the social entrepreneur, whose generosity and ingenuity might just “save the world.” N.G.O.s consistently rank among the institutions Americans trust the most. Among high-net-worth individuals, according to a 2012 survey, more than ninety per cent believe that nonprofits can solve society’s problems, while only fifty-six per cent trust that government could do so.
The recession has deepened this divergence. Even though private charity has fallen during the economic downturn, it remains at historically high levels while public attention has been focussed on shrinking government resources. State and federal budget shortfalls have led private citizens to step in to cover the costs of programs and institutions whose funding has been slashed. In 2011, when a number of California state parks were poised to close, philanthropists picked up the tab. Last October, the former hedge-fund manager John Arnold and his wife donated ten million dollars to keep Head Start programs in six states from closing for lack of funding.
These benefactors usually acknowledge, as Arnold did, that “private dollars cannot in the long term replace government commitments.” But the press coverage of their giving tends to feed the narrative of an enfeebled public sector being resuscitated through the vitality of charitable giving, and the philanthropists are commended for their timely intercession. Yet it’s difficult to remain sanguine about a dénouement that leaves decisions about the funding of government programs in the hands of private donors.
Or, for that matter, one that leaves the funding of scientific research in private hands. Last month, a front-page New York Times story announced, “American science, long a source of national power and pride, is increasingly becoming a private enterprise.” Budget cuts, the Times reported, “have left the nation’s research complex reeling.… Yet from Silicon Valley to Wall Street, science philanthropy is hot, as many of the richest Americans seek to reinvent themselves as patrons of social progress through science research.” Some of those in the scientific community heralded the development, while others worried that private scientific philanthropy, practiced according to the new economy’s “individualistic, entrepreneurial creed,” would set aside national priorities in favor of donors’ personal preferences. And a greater danger lurks: the possibility that the publicity surrounding these cheerful givers might further diminish public support for government funding of science. Already, as the Times noted, Republican members of the House Committee on Science, Space, and Technology have pointed to the surge in private funding as heralding “a new era of lower federal spending.” If taxpayers can’t cure cancer, maybe Jeff Bezos can.
At the turn of the twentieth century, the Progressives had already recognized this danger. “It is a noble spectacle to see the people of New York State, rich and poor alike, voluntarily tax themselves seventeen million of dollars a year for education,” the noted economist Richard Ely said in 1896. “Yet this achievement of self-government is scarcely noticed, whereas the gift of a few millions by a private man” to establish a school “is heralded from Dan to Beersheba.” The celebration of voluntary giving led the public to exaggerate the power and overestimate the efficacy of private philanthropy for the achievement of lasting social reform—which ultimately depends on well-designed legislation and robust public institutions. Simon Patten, another esteemed economist of the late nineteenth century, echoed Ely, arguing that citizens could do more good giving their money to government officials who had the resources to address the root causes of poverty than “spending an occasional half day in moralizing to the poor.” But he recognized that this would be a tough sell. “There is no fire in the citizen’s blood to illumine the nobility of paying higher taxes,” Patten said.
A tough sell, but not an impossible one. For the first few decades after its introduction, in 1913, the federal income tax was levied only on the wealthiest Americans. But, with the transition to a mass tax during the Second World War, the Roosevelt Administration began to promote the idea of tax payment as a necessary wartime sacrifice, based on the consent, and not the coercion, of citizens. The Treasury Department commissioned an Irving Berlin ditty on the topic (“I paid my income tax today / I never felt so proud before”) and recruited Donald Duck to the cause (viewers of a short cartoon learned that it was “your privilege, not just your duty,” to help fund the war effort). When the war ended with the mass tax largely in place, a bit of this sense of civic duty remained, at least for some Americans. (In 1948, Ernest Hemingway instructed his lawyer not to take advantage of a tax loophole without first determining “whether it is an honorable and ethical action to take.” Hemingway conceded that he could use the extra money, but declared, “I do not wish to squawk about being hit financially any more than I would squawk about being hit physically.”)
At mid-century, voluntary giving did not undermine the moral status of paying taxes; it helped to bolster it. As the historian Shirley Tillotson demonstrated in her 2008 book, “Contributing Citizens,” the era’s dominant charitable institution, the Community Chest—the predecessor of the United Way—helped create a “common culture of contribution” shared by charitable donors and taxpayers alike. In the first half of the twentieth century, Community Chests were established in hundreds of cities throughout North America. The Chests would make an annual appeal for funds for the city’s charities—replacing the uncoördinated flurries of solicitations that had long bedevilled givers—and then allocate the funds rationally, based on expert analysis of community needs. Community Chests developed sophisticated, high-pressure fund-raising methods that pushed the idea of giving as a civic duty (as opposed to a religious, ethnic, or fraternal one) incumbent upon all citizens and blurred the line between voluntary and compulsory contributions.
In the late nineteen-seventies, tax revolts spread throughout the nation and popularized a conception of the tax as an insult to democratic practice rather than an embodiment of it. Today, United Ways across the nation are experiencing steep declines in contributions; the age of centralized charity administration is largely over. For many, the individual discretion of the private giver is too precious a resource to delegate to a third party. The common culture of contribution has been rent down the seams. If there ever had been fire in the citizen’s blood to pay taxes, it now seems at a low flame.
Can it be fanned again? One way would be to introduce a dose of voluntarism into the tax system. This is the idea behind proposals for “tax choice,” which would permit taxpayers to allocate a percentage of their income taxes to any area within the discretionary federal budget; research suggests it would boost taxpayer satisfaction. Others have pushed to simplify the tax return—by highlighting the total-tax-liability line on the 1040, for instance—in order for it to better serve “a ceremonial function as an expression of fiscal citizenship.”
Another strategy would be to push back against the veneration of the cheerful giver and help puncture what Mike Konczal has termed “the voluntarism fantasy”: the idea that charity can take the lead in tackling the weighty challenges that face the nation. This once may have been the case, but, as the Los Angeles Times columnist Michael Hiltzik recently observed, “The idea that community or faith-based charities were more efficient, effective and capable than the government of addressing economic stringency hasn’t been true since the industrial revolution transformed the U.S. from an agrarian to an urban nation.”
“There is something very fine, my fellow citizens, in the spirit of the volunteer, but deeper than the volunteer spirit is the spirit of obligation,” Woodrow Wilson announced at the inauguration of the draft, in June of 1917. Does that rhetoric still resonate today, when so little is asked of us, collectively, as citizens? Considering those words anew might not transform us into cheerful taxpayers—our 1040s and 1099s may be too much of a pain to ever bring us joy—but it might restore “a proper sense of proportion” to the moral significance of what those forms represent.
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