State governments are running huge deficits. The federal budget includes enormous spending increases and deficits of unprecedented size. Social Security and Medicare appear unsustainable as currently structured.

Local school districts (at least where I live) face revenue caps that are forcing them to cut people and programs. Cities, towns and villages are seeing state-shared revenue payments cut and in turn have to reduce their budgets.

Where does it end? And in the long run, what does it mean for our society? I know I’m going to hear from my penpals — the usual suspects who call me an idiot and worse — when I say this, but part of the root cause of these problems is our assumption that “you can’t raise taxes.”

I don’t mean to say that the answer to every budget shortfall is more taxation. I simply suggest that we do damage when we take that option off the table completely, or when we only raise revenue in sneaky ways, such as through user fees and “sin taxes.”

(A lobbyist once described Congress’ typical approach to taxing this way: “Don’t tax you, don’t tax me. Tax that fellow behind the tree.”)

Parting company

Maybe critics were right some years ago, probably going back to Ronald Reagan, when they said taxes were “too high.” Fiscal conservatism is (I believe) a virtue. But in the end, that claim has done damage in two ways.

First, it has created a downward spiral in support for vital services and assets. If it’s axiomatic that taxes are “too high,” then they can be cut but never raised. And yet things don’t stop costing money, and inflation doesn’t vanish on command. So we start to see the slow erosion of our school systems and our critical public infrastructure.

Second, it allows the two sides of the taxing and spending equation — what we pay and what we get — to part company. And that in turn enables us to engage in fantasy. The previous president said the war in Iraq was absolutely necessary to our nation’s safety. So we went to war, but since the thought of funding that war by raising taxes was anathema, we did it on the credit card, to the tune of almost a trillion dollars.

The current president says the economy needs a huge federal government stimulus. But since “you can’t raise taxes” in a recession, we’re doing it with borrowed dollars, again almost a trillion. Doesn’t someone, sometime, have to pay for it all?

Gift of the recession?

The recession seems to be bringing all this to a head. At the federal level, concern is growing that the deficit will soon be completely out of hand. In the states, budget shortfalls are extreme.

In Wisconsin where I live, as of midyear, the state government was projected to be some $6.5 billion in the red over the next two years. I’m sorry, but it’s pretty difficult to find $6.5 billion worth of “fraud, waste and corruption” to cut out of a state budget. When you try to deal with a shortfall that size just by cutting, then people, services and quality of life suffer.

The problem then trickles down to local governments. The state tries to save by cutting aid to schools and communities, and now those entities have holes in their budgets. Because there is very little “fat” in local budgets, services have to be curtailed and people laid off (because “you can’t raise property taxes”).

Where all this inevitably must lead is to a discussion on all levels of exactly what we want from our governments, and how much we are willing to pay for it. Don’t argue that taxes are “too high” unless you’re prepared to say specifically what money should not be spent. And don’t argue for a new public program unless you’re prepared to accept the cost of it, starting with next year’s tax bill.

It’s a hard debate. It’s a messy one. It’s also essential. We can’t go on with a borrow-and-spend government, and we can’t go on simply whittling away at our public services just because some people scream that we “can’t raise taxes.”

How much is too much?

One of my critics once pressed me to answer this question: “At what point — at what percentage of income — do you think taxes are too high?” I couldn’t give him an answer because I had to look at both sides of the equation: How what we pay squares with the services and benefits we receive.

What kind of society do we want to live in? What kind of society do we want to leave to our kids? Only when we answer those questions can we decide what level of government service is appropriate, and what level of taxation is acceptable.

Consider Norway. Encarta encyclopedia states that Norwegians “pay about half their income directly or indirectly to the government,” putting them among the highest-taxed of all Europeans.

In return, they have an extensive social welfare system with, among other things, government-financed healthcare, a generous national pension program, free day care for children of working mothers, and free higher education. Considering those and many more benefits, plus basic government services, are taxes “too high”?

Actually, many Norwegians think so, but thus far, that is the social contract their country has chosen. If they lower taxes, just what benefits are they prepared to give up? That would be an interesting debate to hear.

­I am by no means suggesting that the United States should be more like Norway. I am merely asserting that there are two sides to the taxing and spending coin. We need to look at both and find a way to balance what we want with what we’re willing to pay. The mere insistence that “taxes are too high” is an empty rant, indeed. It is also destructive to our collective efforts to create and sustain the society we want.