People created governments to advance the public interest, and they elect the leaders of those institutions. These public servants use their best judgment to tackle the problems important to voters.
But elected officials are also people like the rest of us — often seeking the easy way. This puts people at a disadvantages when their interests collide with the government’s. It’s simply easier for officials to take the government’s side against the citizens.
This matters because elected officials are many. In addition to representatives at the state and federal level, we elect school board members, city councilmembers and mayors, village councilmembers and presidents, township trustees, mayors, clerks, treasurers, library boards, county commissioners, drain commissioners, community college trustees, select state university board members, state board of education members, and likely more that I am forgetting.
Elected officials are responsible for guiding and operating their government unit. One universal fact becomes clear to everyone: It’s easier to run the unit when revenues increase faster than expenses. It’s not fun to make tough decisions on what might need to be cut. This is one reason why there’s always a loud chorus of government officials calling out for more revenue.
This tendency isn’t just in government, though. As Mr. Micawber observed in Charles Dickens’ David Copperfield, “Annual income twenty pounds, annual expenses nineteen pounds and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
It’s just easier to operate governments when they have more money. Consider the property tax elections to build and improve school buildings. Taxpayers would rather not have to pay more to get something that could be accomplished without these taxes. Schools can use their existing resources to build and maintain their own buildings without special millages. In fact, this is how charter schools in Michigan operate, as they are not allowed to ask local taxpayers to pay for their buildings.
Nearly all school boards opt not to use their existing resources for building improvements and ask voters to approve more taxes instead. That way, the district will have more total revenue to spend, and the tough choices are avoided. School officials’ lives are easier that way.
It is harder to run a school when administrators have to economize on existing resources to pay for buildings. Some of those choices may lead to consequences that local voters would find worse than paying more in property taxes. But the incentives faced by elected officials tip the scales toward asking taxpayers to economize on their budgets rather than asking districts to economize on theirs.
That’s why local tax questions require voter approval these days. New local taxes are required by the 1978 Headlee Amendment to be approved by voters. It ensures popular support for local taxes as a counterweight to the tendency for local elected officials to consistently seek higher revenue.
It makes sense that officials want more money for their agencies. Transit officials argue for more transit funding. School groups argue for more school funding. Local government officials argue for more local government revenue. None of this is surprising. Who else would you expect to make these claims?
One might then wonder why, then, Republican legislators and governors sometimes talk about tax cuts. Surely that would make their jobs managing the state government harder. Yet people hear a lot about cutting costs of government from conservatives.
While tax cuts reduce government revenue from what it might otherwise be, governments that cut taxes tend to have extra money to spare. When the majority of states cut taxes after the pandemic, state revenues came in beyond expectations. Although many taxes were reduced, state governments increased total spending from $2.1 trillion in fiscal year 2018-19 to $3.1 trillion in fiscal year 2023-24, a 19% increase above inflation.
Tax cuts are easier to deliver when revenue is up. Lawmakers can afford to let people keep more of their money when they themselves don’t have to spend less.
The lure of taking the easy way is a powerful force that even affects elected officials who want to let taxpayers keep more of their own money. It’s a tendency that voters ought to keep in mind next time elected officials ask for a tax hike. Their elected representatives might be more interested in securing an easy job than in protecting the public interest.
