Your Tax Dollars at Work

by Leigh Graham · 2009-02-23 12:00:00 UTC
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When folks gripe about paying taxes, I often ask if they drive on local roads and how they find the quality of those roads.  To me that's the most tangible level of your tax dollars at work (or not, as the case may be).  Maybe it's an urban planning thing.

Hilzoy gets at the true cost to taxpayers from Obama's housing plan much better than I have.  The first phase costs taypayers "roughly zero.  While Fannie and Freddie would receive less money in payments, this would be balanced out by a reduction in defaults and foreclosures."

The second part - the $75 billion - is taxpayer funded, and this appears to be the least popular part of the plan, as we argue over who deserves this assistance.  Hilzoy, with my emphases:

Anyone who thinks that the mortgage plan should have a way to determine whether the people it's trying to help sent their kids to private schools or took expensive vacations or put in marble countertops is presumably willing to spend the large sums of money it would take to find that sort of thing out about the 3-4 million people the loan modification program is designed to reach. Moreover, s/he should be willing to accept the serious intrusion into people's privacy that this sort of investigation into people's past spending would entail. And s/he should also be prepared to reach many fewer people, since presumably a number of people would not be able to document that all their spending fell within whatever guidelines we deem acceptable...

If we base decisions about who qualifies for the loan modification program on relatively simple criteria -- income, size of loan, other debts and assets -- then we can carry it out relatively simply. But if we insist on figuring out whether each and every applicant spent too much on their vacation in the recent past, or renovated their bathroom without a government-approved reason, or violated the Guidelines on Acceptable Countertop Materials that the Department of Housing would need to draw up, or sent their kids to private schools, we should be willing to pay for the army of bureaucrats who will need to pore over people's financial histories in order to make that kind of determination.

If you really want to know where your tax dollars go, check out this graph of the federal budget.  Hint: war, health and the aged.

Leigh Graham
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