Taxing America



Americans hate paying tax. And that could bring the US economy to its knees. Owen Bennett-Jones explores the cultural, historical and economic forces that have created the widespread and fierce resistance to taxing America.

At the end of 2012, the nation faces the 'fiscal cliff'. Unless politicians agree to a new deal there will be massive automatic reductions in government spending plus the expiration of tax cuts. Most economists agree that this would be a dire outcome. Coincidentally 2013 sees the 100th anniversary of the federal income tax.

The background to this deadlock is a ferocious opposition among much of the population and the political class to any form of tax increase. Which is perhaps strange, as the US takes almost the lowest share of GDP in taxes of any developed nation. By international standards, Americans are not overtaxed. And yet they believe that they are. Which is why lobby groups like Americans for Tax Reform led by Grover Norquist have become so powerful. But now there are signs of change. With the fiscal cliff approaching, and the next elections two years away, some senior Republicans have done the unthinkable and raised the possibility of tax rises.

So how have we got here? And will things really change? Owen Bennett-Jones takes a booth in a diner in New York City to address these questions with three expert commentators – with the help of pre-recorded reports, including an interview with Grover Norquist.

(Image: A woman holds a sign that reads 'Born free, taxed to death', Credit: AFP/Getty Images)