Jay P. Greene's Blog

Kevin Carey responded to my post from yesterday arguing that his opposition to the Arizona tax credit scholarship was inconsistent and not logically compelling.  I’m afraid that his argument remains as inconsistent and unpersuasive as it was before.

He rejects the claim that I attributed to him that tax credits and deductions, in general, are corrupt.  Instead, his argument is now that the AZ tax credit scholarship is “specifically” corrupt.  If that is his argument, then we might wonder why he doesn’t advocate for regulatory reform to keep the program while reducing the potential for abuse.  If tax deductions are not “inherently” corrupt, then we should be able to properly regulate this program to address his “specific” concerns.  In fact, Arizona has already revised its regulatory scheme to address the types of abuses he raised and Carey provides no evidence that the regulations now in place are insufficient.

In addition, if his objection all along was to specific problems with the AZ tax credit scholarship, why did he bother to write at length about how “there’s a well-established process for spending public resources” from which the Arizona program deviates by using tax credits rather than direct appropriations?  Methinks his argument doth shift after I pointed out that the tax code is a very common policymaking method to shape private behavior, and he wouldn’t want to object to the day care tuition tax credit, charitable donation deduction, etc…

And if his claim is that the AZ tax credit scholarship is particularly bad because it creates “private appropriators,”  why does he not have the same objection to charities as “private appropriators.”  After all, the tax credit scholarship organizations are just a specific type of charitable organization.  Like all charitable organizations, they are facilitated in their efforts with private funds by features in the tax code.  All such organizations then “appropriate” money to others.  And there is a potential for abuse with all charitable organizations, including the tax credit scholarship organizations, that we try to control through appropriate regulations.

I can’t imagine that Carey would favor abolishing the tax deduction for charitable giving, so it is unclear why, based on his stated concerns, he should advocate for the elimination of  the private school scholarship tax credit.  Of course, Carey is not motivated by his stated objections, since he would not apply those principles consistently.  Instead, his argument is really just that he opposes private school choice.  I don’t know why he doesn’t just write about that rather than hide behind a convoluted argument about the dangers of tax credits or his inconsistently applied principles of democratic policymaking.

Lastly, I can’t resist responding to Carey’s strange argument about what money belongs to the government.  He writes: “The government doesn’t own all of your money but it does own some of it.”  I agree.  Of course, the part the government owns does not include any of the portions for which I can receive a tax credit.  If his argument is simply that the money I owe the government, after all tax deductions and credits, belongs to the government, then he should have no objection to the AZ tax credit scholarship because that money, by definition, does not belong to the government.  The same is true for money I can keep after tax credits for day care tuition, energy-saving repairs on my house, etc…

Again, his argument has shifted to the point where it no longer advocates for the position he prefers.  Pointing out that there are specific problems with the AZ tax credit scholarship suggests he should favor regulatory reforms, not eliminating the program.  And pointing out that the government owns the money you owe it after all deductions and credits suggests that he should have no difficulty with the AZ tax credit scholarship.

Carey, a pundit at Education Sector, must also oppose the day care tuition tax credit adopted under President Clinton, deductions for charitable donations, and a host of other uses of the tax code to encourage or discourage what people do with their own money.

I say this because it is the logical conclusion that flows from Cary’s post at The Quick and the Ed railing against the tax credit-supported school scholarship program in Arizona whose legality was argued before the U.S. Supreme Court last week.

Carey seems to think that the Arizona tax credit is an unusual and inherently “corrupt” deviation from the “well-established process for spending public resources.”  According to Carey, the normal and appropriate process is:

First, the government raises money through taxes. Then, elected representatives pass a law directing how that money should be spent. One could fill a warehouse with examples of how this process fails to be optimal. But it is open, rational and fair at the core, which is why democracies the world over and throughout history spend money this way.

So if Arizona citizens want to support religious schools with taxpayer money, they should go to the statehouse during budget season and make their case alongside advocates for regular public schools, roads, hospitals, police protection, mental health, higher education, state parks, light rail, and so forth.

Of course, that is one way that democratically elected representatives make policy.  Another very common way to make policy is to use the tax code by offering deductions or credits to shape how people behave with their own money.

If Carey were consistent he would be incensed that promoters of home-ownership or charitable-giving use the tax code to encourage these behaviors with private money rather than having direct government appropriations to home-owners or philanthropists.  He should denounce all tax deductions and credits as a “convolution” and “shell game.”

Carey reserves his venom for school scholarship tax credits, while inconsistently ignoring all other similar uses of tax credits and deductions (most of which I assume he supports), because he particularly hates private school choice.  He hates vouchers with a condescension that is extreme even for DC policy-wonks, as we have noted on JPGB in the past.  The only convolution here is Carey inconsistently arguing against private school choice as a violation of democratic policymaking principles rather than making the direct argument against the merits of private school choice.

Carey does not shrink from making the direct (and frightening) argument that the government owns all of our money except for what it deigns to let us keep:  “Katyal’s premise is that people own every dollar they come to possess. They don’t. They owe some of it the government. It’s not their money; it’s the government’s money.”

Again, if Carey wishes to be consistent he should oppose the charitable giving deduction because that money really belongs to the government, not to individuals who the government is encouraging to support charities.  He should also call for an elimination of the deduction because there are some charities that have misused or unwisely spent the money they have received.  Keeping the deduction but cracking down on abuse clearly wouldn’t satisfy him because he seems unmoved by efforts in Arizona to do that with the tax-credit scholarship program.

Perhaps Kevin Carey should stick to writing about higher education, where he has a number of useful things to say.  When he wanders into the world of K-12 he seems to lose the ability to make logical and consistent arguments.  It is obvious he has not thought through the implication of his argument that would oppose all uses of tax deductions and credits.  He’s so focused on under-cutting private school choice that he fails to consider what his position would mean for home-ownership, charitable giving, or pre-school attendance.  Emerson may have been right that a foolish inconsistency is the hobgoblin of little minds, but that doesn’t mean we can abandon consistency altogether.