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Voting on government spending via taxs

Posted: Mon Feb 06, 2017 10:51 am UTC
by D-503
I propose allowing tax payers to allocate how their tax dollars are spent by designating sectors of the government like military, education, transportation, etcetera on their tax forms. This could be gradually phased in to avoid causing havoc. To test the proposal, control of only a small fraction of the budget would be initially given to the public.

I think this would appeal to people across the political spectrum as it would allow people to withhold their tax dollars from government functions they do not want to support and vote for their beliefs in a more direct way. I think we would all like to have more control over our government. Pork barrel spending and partisan games have become so prevalent in the US that I doubt government representatives are arriving at a budget that is superior to one that could be achieved by direct democracy.

A couple prompts to get discussion started:

1. Would this work? What could go wrong?
2. Would people really be willing to get behind a proposal like this? Would you?

Re: Voting on government spending via taxs

Posted: Mon Feb 06, 2017 12:56 pm UTC
by PeteP
Do you mean you have to pick specific ones or can you say "use it however" because in the second case most of the time it probably wouldn't change much (you basically only have to change your normal budget if the amount bookmarked only for a specific rubric is larger than you intended to spend on that rubric otherwise you just first distribute the limited ones and then get your desired distribution by using the unlimited ones).

But what can go wrong? You are expecting people who have no real idea how much money is needed and where to distribute the budget in millions of uncoordinated actions. It adds unpredictability, say you have single payer heaths care you can't just suddenly change what falls under it because the budget for it got smaller. Or military many would probably like to invest less in it but you can't randomly stop paying for orders you already made or fire soldiers or stop paying for veterans. Raising the budget in a rubric has similar problems, having to find new places to spend the money is one thing when you can plan for several years, but when you don't know how much budget you have available the next year. In short if not enough people go "use it however" and it actually changes anything then it makes long term planning hard.

Re: Voting on government spending via taxs

Posted: Mon Feb 06, 2017 1:47 pm UTC
by Zohar
That is a terrible idea. Complex policies should be determined by professionals. How do I know if how much money should go to education, how much to defense, how much to the justice department? Do I have any idea how much a detective makes, and should they be making more? Absolutely not. I should elect people whose positions I support ("I'd allocate more money for education and less money for defense" etc.), and they can hire professionals who think they can employ their vision.

Re: Voting on government spending via taxs

Posted: Mon Feb 06, 2017 2:28 pm UTC
by Leovan
I’ve been thinking about something like this for a while. I’ll lay out my proposal a bit more detailed and the OP can specify where mine would differ from his idea, or if he’d prefer it being more vague in certain sections.

    The government would propose a budget as usual, but only 70% of every post would be guaranteed. The other 30% is approved by the people via their tax returns, up to a maximum of 120%. That means of every tax return, 70% would be ‘according to government budget’ and only 30% could be allocated to your favorite cause. This would guarantee that even areas of spending that aren’t popular or the cause du jour get a minimum budget allocated. The 120% is a cap so that education for example, which would probably be moderately popular, doesn’t receive double its budget, but does receive a boost vs what the government decided is necessary. Any funds that go above 120% would be divided evenly among the other posts. These numbers would be up for debate (80/110%), and if a lot of representatives agree(supermajority?), could be fixed for one post(so the budget is not up for debate). This would sort of fix the problem where the individual doesn't know exactly how much each area really needs, the 'experts' would be making a proposal and you basically vote on whether you think that is high or low.

    On the tax returns, the budget posts would have to be limited to 15-20 areas, simply because taxes are complicated enough as it is, and most people wouldn’t get the nuances if you broke it down into more pieces. So no “Planned Parenthood” or “Firefighters” posts, but those would possibly be included in “Healthcare” and “Support of public services” instead, and not up for your tax vote. It could be proposed that smaller controversial posts could be added for a form of direct democracy, for example “Wall with Mexico”.

    The taxpayer would fill in the percentages of their taxes they think should go to what services. For example 20% Education, 25% Welfare/Social Security, 15% Military, 40% infrastructure. This could be someone who owns a construction business. It’s in his interest that infrastructure is well funded. I would require that at least 3 posts be chosen with at least 10% to prevent too much focusing.

The advantages of the system would be that you have more control over where your tax dollars go, making you feel better about paying them in the first place. It’s also a form of feedback for the government where the taxpayers feel the problems are. You could use the given percentages independent of how much money is actually behind it to get good information on what the people want. Even if your owed taxes are 0, your voice would be heard.

Disadvantages include the fact that rich people and businesses would have a larger say over the budget than poor people. You could argue that since the 70% is still guaranteed the power still rests with the people, and the middle class as such still makes up most of the tax dollars.

Also, the politicians setting the budget would of course state that 70% of the budget is actually 100% of what they would have proposed if this system wasn’t in place. Similar to how people waste this year’s budget at the end of the year so they get the same budget next year because they might need it then. I’m not sure how you’d prevent that without tying the maximum budget to the expected tax collection. Politicians can then fight over the budget allocation like always. This would limit deficit spending as well, but this can be a negative.

Re: Voting on government spending via taxs

Posted: Mon Feb 06, 2017 5:30 pm UTC
by ucim
What counts as (for example) "defense"? How will the taxpayers know whether any given line item is actually counted under the "defense" category or not? How will they know whether or not it should?

This gives the illusion of populist control, with all the disadvantages and none of the upsides.

Jose

Re: Voting on government spending via taxs

Posted: Mon Feb 06, 2017 6:44 pm UTC
by Soupspoon
Also, in the case of the 'smaller' options like the Mexican Wall (for which the base 70%/whatever is already subatantial, is there any provision for Kickstarter "we need this amount to even bother starting"?

I like the general idea that some public guidance can be 'voted on' through existing channels (basically recurring postal referenda), but that is rather perverse of me given my general attitude against populist reactions (as opposed to properly considered and structured governance in the first place) and the evidence of what sort of messes 'public opinions' can lead us towards in their knee-jerky manner.

(And if the Treasury determines that a vitally important given amount is needed for, say, Education, do they set the mandatory "70% proposal to that value, with no expectation of any more, and give up on persuading people of that lest they 'lose' into the Efucation pot too many percentage-points of redistributable amounts that could have instead gone to various other Public Works that are the current 'theme' of the administration's public face and which they are desperately trying to promote? It seems to me that everyone would be out to 'game' the system by max/minning their most favourite and least favourite personal causes/bugbears, respectively.)

Maybe stability might be achieved by a dendrarchy, each person encouraged to defer their influence by passing it on to another individual who they suport, who in turn passes their accumulated 'power' to others (no looping allowed!), until sufficiently trusted branch-rooters retain their influence within the governmental level. Where perceived imbalances of policy are apparent, shuffling trusts at the leaf-ends and minor branch-roots may rectify things. Still troublesome, whether that's the method of proxy-representation or a taxation-distribution guide.

Re: Voting on government spending via taxs

Posted: Mon Feb 06, 2017 10:11 pm UTC
by elasto
Honestly, the mechanism you're describing already exists in society: It's called charity.

Charity is how every member of society can choose to give as little or as much to as few or as many causes as they wish - be they intelligently researched or purely on a whim.

Government is about a baseline level of infrastructure and social safety nets such that a decent standard of living and level playing field can be had by all.

Government and charity are not in opposition, they are complementary; The strength and weakness of charity is that the causes that receive the most money are by definition the most popular; However, not every cause that is equally important is equally 'sexy'

This is why it can't all just be a 'popularity contest' - we need experts to decide where society's money is best spent, and often that involves long term planning and investment. Thus (in theory) we elect wise politicians who listen to wise experts to make such decisions. That's the part of the process that needs to be improved upon; Going down your road actually represents an increasing abdication of responsibility.

The customer (or in this case voter) is not always right.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 10:15 am UTC
by D-503
Zohar wrote:Complex policies should be determined by professionals. How do I know if how much money should go to education, how much to defense, how much to the justice department? Do I have any idea how much a detective makes, and should they be making more? Absolutely not. I should elect people whose positions I support ("I'd allocate more money for education and less money for defense" etc.), and they can hire professionals who think they can employ their vision.


If you have no opinion you would probably be able to find suggested applications published by political groups you trust and use those. There be could be a default option where your money is allocated in the same proportions as the overall resulting allocation.

I think we agree that the allocation of funding is to some degree political rather that something a professional can optimize. Perhaps the possibility of the populous choosing a plainly suboptimal distribution could be resolved by requiring funding applications to be within 1 standard deviation of a sample of allocations chosen by experts.

A benefit that a direct voting system has is that it is more likely to result in compromise. Rather than the party in power making most of the decisions, we end up meeting somewhere in the middle in proportion to the relative popularity of a funding category.

ucim wrote:What counts as (for example) "defense"? How will the taxpayers know whether any given line item is actually counted under the "defense" category or not? How will they know whether or not it should?


I don't think there is an easy answer to that. Often taxpayers probably wouldn't know if a spending category is used for what they expect. Politicians will need to debate categorizations and reporters will need to inform voters of controversies. I would give a similar answer to the question of how you know an elected official will actually do the things they campaigned on.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 1:41 pm UTC
by Zohar
No, still think it's a terrible idea. Maybe you've never had people close to you work in some sort of fiscal budgeting role, but there's a reason these people have jobs - these things are complicated and require a lot of time to understand.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 2:01 pm UTC
by Katsuray
(In addition to the problem of budgeting ignorance,)

Politicized spending could devolve into bribery by the tax constituent if the system is not large and/or blind enough.

The lobbying ecology alone would become unbearable.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 2:44 pm UTC
by D-503
PeteP wrote:Do you mean you have to pick specific ones or can you say "use it however" because in the second case most of the time it probably wouldn't change much (you basically only have to change your normal budget if the amount bookmarked only for a specific rubric is larger than you intended to spend on that rubric otherwise you just first distribute the limited ones and then get your desired distribution by using the unlimited ones).

In the system I have in mind people would designate a percentage for each spending category.
PeteP wrote:But what can go wrong? You are expecting people who have no real idea how much money is needed and where to distribute the budget in millions of uncoordinated actions. It adds unpredictability, say you have single payer heaths care you can't just suddenly change what falls under it because the budget for it got smaller. Or military many would probably like to invest less in it but you can't randomly stop paying for orders you already made or fire soldiers or stop paying for veterans. Raising the budget in a rubric has similar problems, having to find new places to spend the money is one thing when you can plan for several years, but when you don't know how much budget you have available the next year. In short if not enough people go "use it however" and it actually changes anything then it makes long term planning hard.


There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.

The problem of unpredictability could be resolved by adding a lag time so that budget allocations changes gradually go into effect over years rather than making sudden jumps.

I only imagine this as applying to discretionary spending. Entitlements for things like social security and veteran benefits would be left alone.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 3:35 pm UTC
by ahammel
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

The problem of unpredictability could be resolved by adding a lag time so that budget allocations changes gradually go into effect over years rather than making sudden jumps.
But then you would be setting budget priorities based on what was popular x years ago. That would be extremely inconvenient way to put the country on a war footing, for instance. The war would be over by the time you got around to buying the materiel.

Or say there was a popular proposal to alleviate a recession by investing in infrastructure and public works projects. The country is supposed to just sit around foe a few year having a recession while they wait for the budget allocation vote to come into effect?

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 3:40 pm UTC
by speising
ahammel wrote:
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

While i'm also doubtful if this is better than experts, i think elections would come up with much better answers if they were more fine grained. If your only choice is between two deplorable parties, you're just out of luck. If you could express your preferences over ten or twenty parties or individuals, the aggregate would be a lot more interesting.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 3:42 pm UTC
by eran_rathan
speising wrote:
ahammel wrote:
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

While i'm also doubtful if this is better than experts, i think elections would come up with much better answers if they were more fine grained. If your only choice is between two deplorable parties, you're just out of luck. If you could express your preferences over ten or twenty parties or individuals, the aggregate would be a lot more interesting.


I think that the only way you'd be able to do that would be by either banning political parties or radically changing the system (perhaps disbanding both Rs and Ds under RICO?).

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 3:50 pm UTC
by ahammel
eran_rathan wrote:
speising wrote:
ahammel wrote:
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

While i'm also doubtful if this is better than experts, i think elections would come up with much better answers if they were more fine grained. If your only choice is between two deplorable parties, you're just out of luck. If you could express your preferences over ten or twenty parties or individuals, the aggregate would be a lot more interesting.


I think that the only way you'd be able to do that would be by either banning political parties or radically changing the system (perhaps disbanding both Rs and Ds under RICO?).

Off topic:
Spoiler:
you need to change the voting system. Single-winner elections favour a few big political parties, multi-winner elections favour lots of little political parties.

Re: Voting on government spending via taxs

Posted: Thu Feb 16, 2017 4:42 pm UTC
by Tyndmyr
ahammel wrote:
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

The problem of unpredictability could be resolved by adding a lag time so that budget allocations changes gradually go into effect over years rather than making sudden jumps.
But then you would be setting budget priorities based on what was popular x years ago. That would be extremely inconvenient way to put the country on a war footing, for instance. The war would be over by the time you got around to buying the materiel.


While I agree it's not very responsive, this is essentially always the case with war. You go to war with the tech you built in time of peace.

Re: Voting on government spending via taxs

Posted: Sun Feb 19, 2017 7:00 am UTC
by D-503
ahammel wrote:
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

Crowds certainly make mistakes, but I don't think it is clear that they are more susceptible to mistakes than individuals in this context. Democratic decisions are optimal in the sense that they appease the greatest fraction of the population at the time. I think most people would prefer living with the consequences of bad decisions they had a hand in making than bad decisions made over the objections of the majority.

ahammel wrote:
The problem of unpredictability could be resolved by adding a lag time so that budget allocations changes gradually go into effect over years rather than making sudden jumps.
But then you would be setting budget priorities based on what was popular x years ago. That would be extremely inconvenient way to put the country on a war footing, for instance. The war would be over by the time you got around to buying the materiel.

Or say there was a popular proposal to alleviate a recession by investing in infrastructure and public works projects. The country is supposed to just sit around foe a few year having a recession while they wait for the budget allocation vote to come into effect?


We could give representatives the power to occasionally allocate temporary emergency funding to respond to events requiring immediate action.

Re: Voting on government spending via taxs

Posted: Sun Feb 19, 2017 12:18 pm UTC
by elasto
D-503 wrote:Democratic decisions are optimal in the sense that they appease the greatest fraction of the population at the time. I think most people would prefer living with the consequences of bad decisions they had a hand in making than bad decisions made over the objections of the majority.

If the goal is to share culpability for bad decisions, democracy is a way to achieve that. But if the goal is to make bad decisions less often, you should let experts take the decisions. Sure, they get things wrong, but by definition they get things wrong less often than non-experts.

Re: Voting on government spending via taxs

Posted: Sun Feb 19, 2017 3:40 pm UTC
by ahammel
D-503 wrote:
ahammel wrote:
D-503 wrote:There could be a wisdom of the crowds type of effect (for example:
http://www.npr.org/sections/money/2015/ ... w-they-did) that allows uncoordinated masses to arrive at allocations that are just as good as the experts.
That sounds more like hope than expectation. Does the wisdom of crowds always come up with optimal answers in elections and referenda?

Crowds certainly make mistakes, but I don't think it is clear that they are more susceptible to mistakes than individuals in this context. Democratic decisions are optimal in the sense that they appease the greatest fraction of the population at the time. I think most people would prefer living with the consequences of bad decisions they had a hand in making than bad decisions made over the objections of the majority.
Its not clear that crowds are less susceptible to mistakes either. I don't want a budgetary process that makes me feel better about its bad decisions, I want one that makes good decisions.

ahammel wrote:
The problem of unpredictability could be resolved by adding a lag time so that budget allocations changes gradually go into effect over years rather than making sudden jumps.
But then you would be setting budget priorities based on what was popular x years ago. That would be extremely inconvenient way to put the country on a war footing, for instance. The war would be over by the time you got around to buying the materiel.

Or say there was a popular proposal to alleviate a recession by investing in infrastructure and public works projects. The country is supposed to just sit around foe a few year having a recession while they wait for the budget allocation vote to come into effect?


We could give representatives the power to occasionally allocate temporary emergency funding to respond to events requiring immediate action.
It's not a question of emergency allocations, it's a question of whether budget decisions made on the basis of what's popular today are, in general, going to still make sense in however many years. I'm skeptical.

Re: Voting on government spending via taxs

Posted: Sun Feb 19, 2017 5:21 pm UTC
by D-503
elasto wrote:This is why it can't all just be a 'popularity contest' - we need experts to decide where society's money is best spent, and often that involves long term planning and investment. Thus (in theory) we elect wise politicians who listen to wise experts to make such decisions. That's the part of the process that needs to be improved upon; Going down your road actually represents an increasing abdication of responsibility.

The customer (or in this case voter) is not always right.


To the extent voters do not know which areas would be best to fund, they will be unable to evaluate someone else's aptitude for the task. What makes a bad budget allocation arrived at by direct vote any more likely that one chosen by a bad choice of representative?

Budgets chosen by direct vote have the advantage of being less volatile. Public choice in funding allocation would not undergo as massive of swings as those brought on by the transition of control from one political party to another.

When we vote for representatives it is often as much identity driven as policy driven. Shifting power away from the representatives into direct voting measures allows people to more clearly express their preferences for policies rather than the personalty they like more. It also allows policy preferences to be disentangled. People usually don't approve of every single policy endorsed by their chosen representatives.

Re: Voting on government spending via taxs

Posted: Mon Feb 20, 2017 4:08 pm UTC
by ucim
D-503 wrote:To the extent voters do not know which areas would be best to fund, they will be unable to evaluate someone else's aptitude for the task.
This sounds suspiciously like "don't trust the experts". There are many ways to judge somebody's aptitude for a task that one isn't versed in. You do it every time you hire somebody to do your taxes, fix your transmission, or build an addition onto your house. Governance is no different. It's just that people don't bother to do this.

At the very least, somebody who is familiar with the topic is probably better able to make decisions about it than somebody who isn't, so the zeroth order problem reduces to whether a candidate is familiar with the topic. It's often pretty obvious.

Jose

Re: Voting on government spending via taxs

Posted: Sun Mar 19, 2017 12:16 am UTC
by elasto
D-503 wrote:When we vote for representatives it is often as much identity driven as policy driven. Shifting power away from the representatives into direct voting measures allows people to more clearly express their preferences for policies rather than the personalty they like more. It also allows policy preferences to be disentangled. People usually don't approve of every single policy endorsed by their chosen representatives.

Changing the voting system is the better way to address this problem than changing the tax system.

Re: Voting on government spending via taxs

Posted: Sun Mar 19, 2017 1:59 am UTC
by CorruptUser
You do realize that charities have the horrible problem of donations being earmarked for the flashy stuff, so they don't always have the money for the important things like administration, right? Flashy stuff will get the tax money, important but lesser known functions like CMS will get the shaft.

Re: Voting on government spending via taxs

Posted: Wed Mar 22, 2017 1:05 am UTC
by Opus_723
A weaker form of this would be to simply allow taxpayers to donate to government organizations the way they would to a charity.

I certainly wouldn't mind kicking a few extra dollars to the EPA right now, and I don't have a lot of money to spare. I know a few people that would gladly donate some money to NASA if they could.

The only problem I see with this is that Congress might decide that an institution is getting lots of donations, so clearly it doesn't need so much federal funding, until eventually they DO become charities.

Re: Voting on government spending via taxs

Posted: Wed Mar 22, 2017 2:10 am UTC
by CorruptUser
You can donate to government agencies already. If you send them a check, they aren't going to turn it down.