Last week's, ETS! posed the not-very-rhetorical question of why people pay their income taxes, given the corruption of the system that allocates how that money is spent. One of the major reasons for cooperation--aside from intimidation--is that few people have a good grasp of either how much they're actually paying or where it's going. The quickest way to a revolution in this (or most any) country would be to present every man, woman, and child with just one annual bill for everything they pay in taxes, itemized as to the beneficiaries.

At the federal level--as at state and local--some pains are taken to disguise the nature of this spending. A typical government press release on how federal money is proposed to be spent in FY 1999 looks like this:

50% Direct benefit payments for individuals 15% Grants to states and localities 14% Interest on federal debt 15% Military 6% Other federal operations

Charts like this fuel the myth that welfare queens and ineffective social programs are the cause of rampant government overspending. But there are a few things wrong here.

First, the above percentages include trust funds (like Social Security) as well as general fund dollars (where income taxes are deposited). Since Congress has no say over trust funds in the federal budget, it's irrelevant to policy decisions. The government started listing trust funds in budget figures during the Vietnam War, to disguise the size of military spending. Bureaucrats aren't as dumb as you think.

About military costs: that 15% is strictly Dept. of Defense. It doesn't include the U.S. nuclear weapons program (Dept. of Energy, as in Hanford), NASA funding (primarily military), the CIA or any of the secret National Security Act agencies, or discretionary money available to the President for foreign adventures (e.g., the ongoing massive Persian Gulf mobilization). It also doesn't include costs of past military spending: VA benefits, or the military part of interest on the national debt. Add it all up and direct militarism, the sacred pork of the federal budget, will account for 49% of discretionary federal spending in FY 1999.

"Benefit payments to individuals" is also misleading. The largest chunk is Medicare--most of which doesn't end up with individuals at all, but in the inflated profits of health care providers, insurance, and drug companies. Every other major spending sector--Education, Health and Human Services, HUD housing subsidies, food stamps, the Labor Dept.--has been continuously cut back and/or devolved to the states under Bill Clinton.

Washington is one of those states--and one with an unusually regressive tax system. Poorer people pay disproportionately high taxes here. This is largely due to our lack of an income tax and fondness for sales taxes, property taxes, and sin taxes and lotteries. When Washington--flush with cash at the moment, though that's changing as Asia's economies stagger--cut its property taxes this year, the big winners were large corporate landholders like Boeing and Weyerhaueser. The little guys just keep seeing services cut.

Money in each category in the federal spending breakout winds its way, in massive amounts, to the pockets of the wealthy, who don't pay in nearly what they take out. Capital gains taxes were cut sharply, again, this year; an estimated 85% of the savings will go to people in the nation's top 5% of income. The percentage of U.S. income taxes paid by corporations (as opposed to individuals) has dropped from 25% to 8% in the last 40 years; the U.S. has by far the lowest corporate income tax rate of any Western country.

In the last generation, Tax Day has become a national holiday, a collective scream of anguish (as well as an excuse for sales at the mall), but for somewhat the wrong reason. People object to having to pay out (beyond what's withheld from your paycheck--which many don't even realize is a part of your annual tax bill, hence statements like "I didn't pay any taxes this year. I'm getting a refund!"). But the larger tragedy is that our democracy has been rigged in such a way that the folks writing tax laws are getting elected with the big money of the folks reaping windfalls from the tax laws. It's a vicious circle, and it's getting worse. Happy Tax Day.