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More than Taxes

Much of the coverage of the Tea Parties — both mainstream coverage and even some conservative analysis — has characterized the protests as “anti-tax.” There is something to that, but I think that summary misses the main focus of the protesters’ ire, and in some sense sells the participants and organizers short.

In Washington D.C. (where I observed the 2,000-person rain-drenched rally) and across the entire the country, the focus of these impressively-sized rallies was not so much on taxes but on runaway spending, looming deficits, the threat of hyper-inflation, government over-reach into the private sector, and bailouts. (Yes, ordinary citizens are discussing the threat of hyper-inflation and devaluation of their currency.) These people anticipate huge tax increases down the road but understand that this is the unfortunate result (one of many) of the policies being currently advanced. They understand the unspoken deal in the works: spend now and worry about paying it off by higher taxes later on.

So yes, these people care very much about taxes but their limited-government/personal-responsibility mantra is not simply a repeat of the 1970s tax revolt when marginal tax rates and rising property taxes (specifically in California) spawned a taxpayers’ revolt and eventually the Reagan Revolution. They fear we are losing the values of free market capitalism, which have made this country prosperous, and they dread the vast enlargement in the size and scope of government.

Why are so many misinterpreting the message? It is a natural error to some extent since the protests occurred on Tax Day. But it isn’t that hard to read the signs, talk to a few participants, and listen to the speakers to discern what the agenda is. One can’t help but think the focus on taxes is a way of disparaging those involved and dismissing the real gravamen of their message. “Don’t they know about the Making Work Pay tax break?” sniffs the White House and its media cheerleaders. Well, yes, but at least at the D.C. protest people have figured out that said tax break ends in 2010 and they would still be swamped by the energy tax, tobacco tax, and whatever funding mechanism the Obama team will come up with for healthcare.

But more importantly, these people are objecting to the entire agenda of the Obama administration, which in their eyes only builds on the errors committed by George W. Bush. They didn’t like the car bailout then and they don’t like it now. They thought the Bush stimulus plans were a waste and they think the trillion-dollar Obama plan is a bigger one. They hated the increase in domestic spending under Bush and they recognize Obama is spending far more.

For many in the punditocracy it is easy to write off protesters as uniformed tax-haters. But these Tea Party attendees are demonstrating a greater level of economic sophistication than many in the pundit class and in government. Should that sober message take hold — building on polling which shows voters (especially independents) increasingly skittish about spending and actively hostile toward bailouts –then Obama and his Congressional allies will have a full-fledged revolt in their hands. So, far easier to ignore or dismiss the protesters then to to examine their criticism.


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