Political scientists seem to agree that Americans are the world’s leaders in voluntarily paying their taxes every year.
Analysts compared Americans to others around the world and found that we easily outpaced — at more than 83 percent — the other leading nations of the globe when it comes to paying up taxes without a fuss.
Still, that compliance rate has been slipping a bit, year by year, and this new information is one reason why caution is required about a bill regularly pushed in Louisiana’s Legislature by state Rep. Tony Bacala, R-Prairieville.
His House Bill 72 was killed in Senate committee late in the session, not unexpectedly, and after a thumping endorsement in the other chamber. It was an effort to give Louisiana's legislative auditor access to income tax data to check Medicaid eligibility.
Senators voted 5-3 to shelve the bill, voting along party lines, with Democrats against the idea and Republicans for it. Gov. John Bel Edwards, who expanded the state's Medicaid program to cover thousands more people, is a Democrat, and Republican politicos have enthusiastically attacked him for it.
They don’t go so far as to say that they would take insurance cards from working-class families; that would be full-scale Pottersville, making Edwards the equivalent of Jimmy Stewart.
Opponents of the bill said the health department has improved its wage-verification system to check eligibility, but they also worried confidential tax data would get leaked to the public.
Legislative Auditor Daryl Purpera said his office has access to wage data, to compare against eligibility, but he said that doesn't include self-employment income and other types of income. That seems nitpicking; the vast percentage of the income of working-class people is in wages.
And it’s not unreasonable to worry about tax compliance; studies that show even honest Americans are becoming over time less forthcoming to the Internal Revenue Service. Several articles in the national press have noted that issue recently, including The Economist (where compliance is seen as a symptom of stability in society) and in the libertarian journal Reason (where almost every tax is a bad idea). But the larger point is that state tax returns, like federal ones, are strongly protected in law, and should be.
Bacala broadened his legislation this session beyond Medicaid to give the auditor tax return data to crosscheck eligibility for state-administered programs that use an "income or asset test." That could also sweep in the food stamp program, among others.
It’s likely that the largest amount of money lost in Medicaid, or any other means-tested government service, comes from providers of health care or other work for government; they either cheat, or improperly account for the services, so that the U.S. government — a partner in programs like Medicaid and food stamps — wants its matching money back.
But the current systems appear to deal with that without reaching into tax forms that people need to feel are truly private — that they can report honestly without fear that some ingenious hacker is going to make data public.
Fraud, even in the thousands of cases, amounts to a very small fraction of the hundreds of thousands of Medicaid recipients in Louisiana. No fraud should occur, but it’s poor judgment to focus on it to the exclusion of the good that programs can accomplish in many more lives.