Taxing the Poor: Doing Damage to the Truly Disadvantaged (Wildavsky Forum Series)

Wildavsky Forum Series

by Katherine S. Newman, Rourke O'Brien

This book looks at the way we tax the poor in the United States, particularly in the American South, where poor families are often subject to income taxes, and where regressive sales taxes apply even to food for home consumption. Katherine S. Newman and Rourke L. O'Brien argue that these policies contribute in unrecognized ways to poverty-related problems like obesity, early mortality, the high school dropout rates, teen pregnancy, and crime. They show how, decades before California's passage of Proposition 13, many southern states implemented legislation that makes it almost impossible to raise property or corporate taxes, a pattern now growing in the western states. Taxing the Poor demonstrates how sales taxes intended to replace the missing revenue—taxes that at first glance appear fair—actually punish the poor and exacerbate the very conditions that drove them into poverty in the first place.

Genres: Politics, Nonfiction, Economics, Class

262 pages, Paperback

First published January 28, 2011

About the author

Katherine Newman is Professor of Sociology and James Knapp Dean of the Krieger School of Arts and Sciences at Johns Hopkins University. Author of several books on middle class economic instability, urban poverty, and the sociology of inequality, she previously taught at the University of California (Berkeley), Columbia, Harvard, and Princeton.

Reviews

[Mal Warwick · Rating 4 out of 5]

Students of poverty in America have searched for its roots in many areas, including racism, culture, genetics, personal responsibility, and social policy. Taxes, by contrast, have received little attention. In Taxing the Poor, Katherine S. Newman and Rourke L. O’Brien respond to this oversight with an illuminating survey of how tax policy in the South has contributed in major ways to the poverty endemic in the region on both sides of the color line.

Compared to the rest of the country, the states of the old Confederacy depend to a great extent on sales taxes as a source of revenue. Similarly, the South imposes much lower corporate and progressive income taxes. The result is that the burden of funding the government falls disproportionately on those least able to pay. One of the major consequences of these policies is that the states of the region are significantly underfunded, especially in providing services for the poor. Another is that high sales taxes — especially on groceries and other necessities — drain a substantial portion of the poor’s meager income, putting them at a great disadvantage even when compared to the poor in other regions.

However, as the authors make clear, it’s not simply taxes per se that lie at the heart of this problem. Like California, where Proposition 13 has made it virtually impossible for state or local government to raise new taxes by imposing a supermajority rule on both legislation and popular initiatives, the states of the South have their own supermajority rules. Significantly, though, those rules were adopted decades before 1978, when Proposition 13 was passed.

Newman and O’Brien make clear that the historical origins of this disjunction between the South and the rest of the country lie in the decades leading up to the Civil War, when the slaveholding elite held the reins of government and succeeded in deflecting the cost of running the states by eliminating or minimizing taxes on their “property.” The years of Radical Reconstruction (1865-77) corrected some of this imbalance, but the progressive policies enacted then were reversed in the reactionary time that followed, when the foundations of Jim Crow society were firmly laid. Southern elites — conservative and racist Democrats — even managed to blunt the impact of the New Deal by exempting domestic and agricultural workers from Social Security until the 1950s.

The book does not dwell exclusively on the states of the South. The data excavated by the authors reveals that policies in California and its neighboring Western states have been moving in the same direction, most notably with Proposition 13′s supermajority rules defunding the schools and the state’s human services.

Taxing the Poor, published by the University of California Press, is the work of two sociologists, Katherine S. Newman of Johns Hopkins (formerly of UC Berkeley) and Rourke L. O’Brien, a Ph.D. candidate at Princeton. The book is based on a lecture in the UC Berkeley Wildavsky Forum. The authors make their case with a generous use of maps, charts, and tables that gives a visual dimension to the statistics underlying their study. Yet, unlike so much work from academics, they manage to make the book readable. There are few excursions into statistical mumbo-jumbo in its pages.

As American history, not just the sociology of poverty, Taxing the Poor is a solid piece of work.

[Hubert · Rating 5 out of 5]

Newman's combines precise economic and statistical analysis with solid ethnographic motivations to create this short tome detailing the role sales tax plays as a regressive tax which disproportionately hurts the poor, particularly in Southern states. A must-read in light of the current public policy debates on taxation in the United States.

[Brien · Rating 4 out of 5]

Newman and O'Brien examine the regressive taxation policies that have adversely affected the poor. As states seek more revenue, particularly at a time when the federal government's largesse to the states is less and less large, state sales taxes have been considered to be a way to go, particularly in the South. This tax, among other pernicious trends, increases the wealth gap, and inhibits economic mobility, making it ever harder for the poor to emerge from poverty.

[Casey Willits · Rating 3 out of 5]

The prescription of returning more of the policy setting to the national level would be interesting to revisit considering everything that happened during the pandemic. Universal cash transfers, fully refundable child tax credit, expanded child tax credit sent monthly, etc were quite dramatic changes of policy.

[Zibei · Rating 4 out of 5]

This book described how tax system contributed to economic unjustice, I like the narrative included in this book!