March 28th, 2015
Five Years Later, the Tea Party Still Doesn’t Understand Taxes or the Boston Tea Party
It’s been five years since the official founding of the tea party movement. Weird, it seems like much, much longer, but there it is. Five years since tri-corner hats with dingle-dangle tea bags glued to the brim became the national symbol of incoherent, far-right outrage over the ascendancy of an African-American president tasked with lifting the nation out of a devastating Great Recession not of his own making.
The tea party emerged as an unofficial sequel to the angry mobs that formed outside various McCain/Palin rallies during the 2008 campaign, complete with viral video messages warning of emerging communism, “Hussein” sleeper-cells and Rev. Jeremiah Wright goddamn-America-hating. A general profile of each group showed considerable overlap: white, Christian, conservative, older Americans who were both shellshocked by the financial impact of the recession and that the obvious cultural shift taking place in politics, potentially leaving them behind. The president was no longer a twangy, southern good ol’ boy or a congenial, plain-spoken old man. This new president would be a northern intellectual — an African-American man with an “exotic” name and a suspicious background. A flaming cocktail for inciting white conservative fear.
Fast forward to the months following the 2009 inauguration.
Coinciding with congressional debate over the new president’s stimulus package, the movement proudly adopted as its namesake the Boston Tea Party, with “tea” carrying the bonus “taxed enough already” acronym. Both meanings contained within the name of the movement were hilariously ironical given how the stimulus would eventually contain, as a total dollar amount, the largest middle class tax cut in American history as well as the fact that the Boston Tea Party was a protest against a corporate tax cut.
We discussed this briefly yesterday, but it deserves a more detailed retelling considering how it’s been five years and the tea party still doesn’t grasp how it’s named itself after an act of sabotage that was in direct opposition to a corporate tax cut.
Rewind to 1773 and the passage of the Tea Act, the British law which ultimately sparked the famous Boston Tea Party.
The East India Company, the Walmart or McDonald’s of its era, was in serious financial trouble, and being so closely tied to the economy of Great Britain, it was, you know, too big to fail.
But rather than bailing out the corporation, King George and Lord North decided that if they just cut the export duty of the company to zero and allow it to sell directly to the colonies, the East India Company would be able to unload its tea to the colonists at a discount — boosting sales and rescuing the near-bankrupt mega-corporation. Plus, they reasoned, the colonists would embrace the British monarchy for the cheaper tea, and tensions between the empire and the colonies would be ameliorated, at least temporarily.
So in May, 1773, Parliament passed the Tea Act. The long-form subtitle of the act read as follows:
“An act to allow a drawback of the duties of customs on the exportation of tea to any of his Majesty’s colonies or plantations in America; to increase the deposit on bohea tea to be sold at the East India Company’s sales; and to empower the commissioners of the treasury to grant licenses to the East India Company to export tea duty-free.”
Several months later, the East India Company attained the proper clearances and set off to various colonial sea ports with its duty-free tea.
To repeat, the rationale for the Tea Act was that lower taxes meant lower prices, which meant the East India Company could sell a hell of a lot more tea. Suffice to say, the smaller colonial tea distributors weren’t happy — not to mention smugglers like Samuel Adams’ close confidant John Hancock. Colonial retail prices would be severely undercut by the tax-free tea, potentially shoving the smaller importers, and smugglers like Hancock, out of the tea business. Your basic free market precursor to supply-side Reaganomics in action. In other words, the British government’s solution to the East India Company’s financial crisis was, in effect, a massive tax cut — a tax cut to zero.
Consequently, political activists and, most famously, the Sons of Liberty, proceeded to intimidate and raid — with orders to tar and feather the pilots — any East India tea ship landing at various ports from Philadelphia to Sandy Hook to, naturally, Boston. And later that year, on December 16, 1773, when the Dartmouth, Beaver and Eleanor were docked in Boston Harbor, the Sons carried out their famous protest, dumping hundreds of crates of tea into the water.
All because of a tax cut. Not only that, but the tea party Republicans, while comporting themselves as cheap knock-offs of the Sons of Liberty, have instead embraced the tax-cutting, supply-side policies of the British monarchy.
Boiled down, it appears as though the tea party movement is in favor of tax cuts, while embracing an historical event that was violently opposed to tax cuts. In the interim, the tea party has vocally objected to the notion that something like 47 percent of Americans don’t pay federal income taxes. Who is the 47 percent? Forbes broke it down:
–17 percent includes students, people with disabilities or illnesses, the long-term unemployed, and other people with very low taxable incomes. Also included would be people like our soldiers in foreign wars who are exempted from paying income taxes while they are on active duty in a war zone.
–22 percent of people who did not pay federal income taxes in 2009 are people aged 65 or older who have modest incomes (and do not have earnings).
–61 percent are working people who pay payroll taxes but are not paying income taxes.
It’s important to highlight that these 47 percent do, in fact, pay state, local, sales and other taxes. So the tea party appears to be in favor of higher taxes for families, seniors and disabled Americans, while also being in favor of lower taxes for the wealthy and corporations, the latter being the exact opposite of the Sons of Liberty. You’d think the tea party, which has apparently been “taxed enough already,” would support the idea that nearly half of us don’t pay federal income taxes. But they don’t. Weirdly.
Obviously the tea party’s organizers failed to read about history before inappropriately horking the “tea party” moniker, and, indeed, they’re more than a little confused about taxes, both modern and historical — the issue upon which the entire movement is based.
Anyway, happy fifth anniversary, you magnificent bastards. Hopefully in honor of this occasion, someone will give you the gift that keeps on giving: some high school level history and economics books.
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March 28th, 2015