When you filed your taxes this week, did you get your money’s worth?
It might be tempting to say that freedom, security, and the rule of law are priceless, but, citizens of the United States have long enjoyed those benefits, and for most of that history, taxes were far lower than they are today.
So the question remains: Are we getting our money’s worth?
The sad truth is, that as things stand now, there is no good way to know whether we’re getting excellent value for our tax dollars or whether we’re getting fleeced.
For most purchases we make in daily life, it is pretty easy to tell. Stores post their prices, so you can tell what things cost, and we can easily assess for ourselves the quality of the goods we use on a regular basis. The existence of competitive markets gives private firms strong incentives to provide good value, because companies that charge too much for shoddy goods end up going broke (unless, like GM, they get bailed out by the government).
For large and infrequent purchases, like automobiles, we have less personal information to rely on, because we can’t have first-hand knowledge of all the other cars out there, although there are excellent sources of consumer information that we can consult for guidance.
But the government is not and can never be like a regular business. The federal government is a monopoly: we have to “buy” such goods as national security, Medicare, and Social Security from the national government, and we have to pay whatever price for those goods the government sets. The feds face no competitive pressures and have no direct incentive to provide good value for money. So we have every reason to fear that we are not getting our money’s worth. Even the states face only modest competitive pressure, because it is much harder to move from Maine to Texas than it is to trade in a Chevy for a Ford.
We need to demand better information, both about the costs of government, and about the real benefits it is trying to promote in the world. Only when we have both kinds of information will we be able to make any sort of informed judgment about the value of what we’re actually paying for.
Start with the first item: do you actually know how much you paid in taxes last year? I know I don’t. Your income tax forms list most of the big amounts, but there are a host of other taxes we pay a little at a time — sales taxes, hotel room taxes, taxes on airfares, and on your phone bills, gasoline taxes, “sin” taxes on tobacco and alcohol.
And, in addition to those, you pay a share of the taxes you think corporations pay — because they pay lower wages and charge consumers higher prices for what they sell and, when corporations make less money, your retirement investments suffer. So the “price” of government is not transparent and is almost certainly more than you think.
Even more difficult is to determine the value of what government buys on our behalf.
When we get information at all, usually it relates to inputs. We spend this much on education or that much on health care.
But such “input” measures are irrelevant. What we need to know about are the real “outputs” of government. When we spend more on education, do children actually learn more? When we spend more on Medicare and Medicaid, are people actually living healthier, longer, more active lives? Does welfare get people back to economic self-sufficiency?
How good are the roads we’re paying to maintain and repair? Are they in terrible shape this spring because we were too cheap to pay for quality repairs, or because the contractors ripped us off?
From our governments, we should demand clear information — before any new programs are approved or any old programs receive new funding — exactly what output measures will constitute success.
We should have no illusions that such measures will be easy to devise. They won’t be, and any particular criterion of success will be controversial. But without such measures, we have no rational basis at all for judging the work of government.
Then we need trustworthy, outside groups to measure and report on those outputs.
Finally, and most importantly, we as citizens need to hold our public officials accountable for the results: when they don’t end programs that fail to meet their goals, we must end their political careers.
Joseph R. Reisert is associate professor of American constitutional law and chairman of the department of government at Colby College in Waterville.