The silent majority is taxed enough already

The silent majority feels taxed enough already. Why don't they support the Taxed Enough Already party? Photo: Wikipedia

WASHINGTON, December 8, 2013 — High income earners in New Jersey can pay a top federal marginal income-tax rate of 39.6 percent. They then pay 9 percent income tax to the state, a 7 percent sales tax on almost everything they buy, the highest property taxes in the country, the maximum social security tax, almost 3 percent for Medicare tax and hidden taxes on gasoline, cigarettes, alcohol and now medical devices. This puts their marginal tax rate well above 50 percent. That is more than enough.

In the early 1970’s, Vice-President Spiro Agnew popularized the term “silent majority.” It refered to the majority of Americans who were so busy earning a living, raising a family and taking care of their other responsibilities that they had little time to voice their concerns about politics. 

Many laws, particularly those involving government’s taxing and spending policies, seemed to benefit a small percentage of the people while harming this silent majority. Since they had little time to voice their concerns, they relied on elected officials to represent them.

Elected representatives seem to vote in favor of vocal special interests, much to the detriment of the silent majority. The only chance the silent majority has is to raise their voices at the ballot box. In 1978, Proposition 13 passed in California, to wide surprise in a state that generally favored raising taxes to pay for ever-expanding services while ignoriing the concerns and burdens placed on the middle-income families that footed most of the bill. 

Proposition 13 essentially reduced property taxes by more than 50 percent. This was the first time that the silent majority was so fed up with constantly rising taxes that they voted directly to reduce them. 

This frustration was felt nationwide. In 1980, a former California governor was elected president, mostly because of this promise to reduce federal income tax rates for all contributors to the economy, especially those who contributed significantly. By 1981, income tax rates were cut for everyone; no American had to pay more than 31 percent in federal income tax.


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The result of this, coupled with the removal of counter-productive government regulations, set off a 26 year period of economic growth, excepting a couple of hiccups in 1981 and 1991, that was characterized by low unemployment, low inflation, moderate interest rates and general prosperity. The silent majority were able to return to the business of earning a living, raising a family and being responsible. Things changed, though.

Taxes were increased in 1986 and again by George read-my-lips-no-new-taxes Bush in 1990. More taxes increased through the Clinton and younger Bush years, and by 2008, the silent majority again felt over-taxed and under-represented. They felt they were taxed enough already. They wanted tax rates reduced, which meant that government spending would have to decrease dramatically in order to at least come close to balancing the budget. 

Unfortunately, the timing was not good. Economic turmoil led to pain for the American people, especially those at the lowest income levels. Since the silent majority is very compassionate, some decide to put the plight of the poor ahead of their personal interests. This was enough to shift the balance from the silent majority to the vocal few.

But many remained determined. They took their position of being taxed enough already and formed a movement that became known as the Tea (taxed enough already) Party. Again they used the ballot box to have their voice heard. In 2010, they elected many representatives who shared their view. The result was that they were able to actually reduce government spending and hold the line on tax rates for all except those at the very top of the income ladder.

In 2012 the silent majority had to gain further voices in government. Unfortunately, the vast increases in unemployment compensation, food stamps, free health care, easy to get welfare and other social programs enacted by the current administration meant that only 53 percent of households actually paid federal income tax. The remaining 47 percent voted to keep the current gravy train, and the administration was able to convince enough of the silent majority to join them to win re-election. The silent majority, however, may now be ready to stand firm.

The Tea Party represents many of the interests of the silent majority. Reducing taxes, reducing government spending, adding freedom back to the marketplace, de-regulating over-burdened industries and generally adhering to the Constitution are principles that are shared by the silent majority and the organized portion of the Tea Party. The problem comes on social issues.

While the silent majority is generally conservative, they have a much more moderate view on social issues. Through their life experiences they embrace the spirit of compromise, while maintaining their core values. The Tea Party will have to better understand the silent majority if they expect to be a dominant force in American politics.


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Michael Busler

Michael Busler, Ph.D. is a public policy analyst and an Associate professor at Richard Stockton College teaching Finance, Financial Institutions, Introduction to Financial Management, Game Theory, Graduate Managerial Economics, Graduate Financial Management. 

 

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