Playing chicken with history.

• Author: Glastris, Paul
• Position: Editor's Note - Editorial

If America really is threatened by a growing mountain of debt, shouldn't the wealthy help out by paying higher taxes? Most voters think so, according to polls, and for good reason. The rich have enjoyed staggering run-ups in their incomes and net worth in recent years, while average Americans have barely treaded water. Yet the effective tax burdens on the wealthy are lower now than at almost any time in the past fifty years, thanks to past rate cuts and a proliferation of tax exemptions which, as Suzanne Mettler makes clear in this issue (page 29), shower most of their benefits on the affluent. The idea that the economy will suffer if we modestly raise taxes on upper-income Americans is belied by recent history: we increased tax rates on the rich in 1993 and the economy created more than twenty-two million jobs; we cut them in 2001 and the economy created fewer than seven million jobs. Of course, to put our long-term fiscal house in order, we also need to get control of Medicare spending--which, as Sebastian Jones explains (page 9), means not letting Congress kill off a powerful but little-known cost-containment board called for in the new health reform law. Other cuts in government and tax hikes that hit the middle class may also be necessary eventually. But wouldn't Americans be more willing to accept such shared sacrifice if they knew the rich were first in line?

Of course, GOP leaders have refused to even consider tax increases, especially on the rich--or, as conservatives like to call them, the "wealth producers." The Ryan plan would further cut taxes on the wealthy and pay for them by gutting Medicare benefits. So determined are Republicans to shield the wealthy from taxation that they have been playing a game of chicken with the White House over raising the debt ceiling, at the risk of spooking financial markets, wrecking America's credit rating, and plunging the economy back into recession.

As it happens, the willingness of the rich to defend their wealth from taxation to the point of national ruin is nothing new in world history, as Francis Fukuyama recounts in his magisterial new book The Origins of Political Order. The Han dynasty in China fell in the third century AD after aristocratic families with government connections became increasingly able to shield their ever-larger land holdings from taxation, which helped precipitate the bloody Yellow Turban peasant revolt. Nearly a millennium and a half later, the great Ming dynasty...