03/08/2012 12:03 pm ET Updated May 08, 2012

Shifting Tax Burden to Lower Classes Is Immoral

By Daniel Taibleson

For the past few decades, conservatives have wielded the issue of taxes like cudgel, using it beat down opponents. Interesting however, is how they have managed to use tax rhetoric so effectively despite a lack of compelling evidence to support their claims about taxes. They argue that tax cuts do not add to the debt -- the Bush tax cuts for the top 5 percent alone have added $1 trillion to the debt since 2001. They argue that a rising tide fueled by tax cuts lifts all boats -- there are more millionaires now than ever before, but median wages are at their lowest point since 1996.

So, how is it that the above facts have done nothing to diminish the effectiveness of anti-tax rhetoric? The answer is simple. Conservatives have, over time, managed to frame the debate over taxes as a moral issue rather than one of equitability. By arguing that higher tax rates facilitate excess spending, they have managed to conflate increasing taxes with increasing government debt -- implying that the only way to avoid the "moral hazard" of footing others with the bill for what we buy today is to cut taxes.

This, however, gets the reality totally backwards. Tax revenues are what allow us to pay our bills today and to thereby avoid forcing someone else to pay them tomorrow. Progressive taxation is how we avoid shifting costs onto those who can least afford them.

Iowa Gov. Terry Branstad and the Iowa Legislature are entertaining a number of tax-cutting proposals liable to further increase the size of the bill shouldered by Iowa's poor and working class. Not because cutting taxes for corporations and the wealthy inherently increase the tax burden on the poor but rather because the resulting reduction in state services shifts the cost burden onto localities that rely on more regressive revenue-raising instruments.

For example, Cedar Rapids is considering a 1 percent increase in its sales tax to fund the maintenance of its flood-protection system -- a measure that will be particularly damaging for the 12 percent of Cedar Rapids residents who live below the poverty line, which is $22,000 a year for a family of four. This is especially true when you consider that people living below the poverty line are forced to spend almost all of their income on goods subject to sales taxes -- clothing, etc.

Furthermore, when taxes are cut in one place, they must go up somewhere else, because states are required to balance their budgets. This means that it is inevitably true that regressive tax increases that hit the poor and working class hardest will go up when progressive taxes that require more of the wealthy and corporations go down.

This is why as every single Iowan is staring down the barrel of a possible 10 cent increase in Iowa's gas tax to make up the $200 million shortfall in Iowa's road maintenance and construction budget, while corporations stand to benefit from a $300 million commercial property tax cut.

To be sure, conservatives will argue that these big tax cuts will pay for themselves -- increasing state revenues and alleviating the burden shifted onto localities and the poor in the long run. However, as Iowa Policy Project Research Director Peter Fisher told me:

"I do not have any research that shows that these kinds of tax cuts pay for themselves" and that "[the] losses have to be made up by raising taxes on everyone else."

Counter to the contention of conservatives, tax cuts do not prevent immoral cost shifting. If anything, tax cuts increase that risk because they facilitate shifting the responsibility of implementing wildly unpopular tax increases and budget cuts elsewhere. Recklessly cutting taxes for corporations and the well-off at the state level shifts costs onto localities and increases the burden borne by the poor and working class -- that is immoral.