Representation without taxation.

• Author: Kane, Tim D.

"For or imposing taxes on us without our consent...." With these eight words, Thomas Jefferson made tax protest an integral part of the Declaration of Independence. He was responding to King George III, who levied taxes on the colonists, but denied them Parliamentary representation. This injustice--taxation without representation--was a flagrant violation of the sacred compact between government and governed. What would restrain the state from levying taxes on a people without voice or power? This thorn was worthy of being included in Jefferson's list of those American grievances which "impel [us] to the separation."

Two hundred and twenty-one years later, taxation without representation has become the opposite perversion: representation without taxation. By granting a growing number of Americans the power to elect, lobby, and otherwise influence the Federal government without paying for the resulting policies, Congress unwittingly has created a new class of citizen.

Observers long have noted with dismay that citizenship responsibilities have been among the casualties of the modern welfare state. By using the Federal tax code as a tool to stimulate demand and redistribute income, taxation no longer is recognized as an inseparable aspect of citizenship, the acceptance of which permits all citizens, rich and poor alike, to participate as equals in the debate over the proper role and size of government.

The marriage of taxes paid to benefits received made it possible for the citizen to choose the appropriate role and scope of his government. Yet, what happens when some potential American voters are "assigned" a zero share of the tax burden? Much like a consumer whose demands become unlimited when goods are "free," the citizen's demand for "public goods" knows no bounds when severed from the obligation to contribute toward their costs. The economic reality is clear. Rational decision-making only can take place when the individual weighs expected benefits against expected costs. Decisions made in the absence of cost distort resource allocation and reduce the welfare of others.

How many such people are there? Published Internal Revenue Service data from its annual sample of personal income tax returns and the Census Bureau's Current Population Report series on consumer income provide the answer. In 1993, almost 30% of all adult earners paid no Federal income tax. Between 1975 and 1993, the ratio of earners age 18 and older to the population rose...