Every nation levies taxes. Some nations levy well. In these admirable nations, tax systems spread the tax burden fairly. Those who can readily afford to pay more in taxes do pay more.
Other nations tax poorly. They set low tax rates on high incomes. Officials in these nations let their wealthiest carve generous loopholes in their tax codes. They wink at outright tax evasion.
Nations that go down this sorry second path don’t just lose out on revenue they ought to be raising. They turbocharge their inequality. They invite corruption. They poison their civic culture — and eventually, once enough poison takes hold, crash their economies.
This crashing played out earlier this century most notably in Greece. That nation’s economic life essentially collapsed, the Economist business magazine noted six years ago, amid a tax evasion that had evolved into “less an under-the-radar activity, more a social norm.”
The Greek wealthy, the Economist observed, established that norm. Greece’s most “egregious” tax cheating, researchers had found, “happens higher up the wealth ladder.”
The United States hasn’t hit — yet — the levels of tax evasion that leveled Greece. But we’re moving in that direction, ever more deliberately. This past winter saw lawmakers shove us further down this perilous path in two major pieces of legislation.