Do you support same-sex civil marriage and reducing defense expenditures? Do you think that tax increases should be part of the effort to address America’s long-term fiscal imbalances in addition to deep spending reductions? You might be a David Koch Republican, per Kenneth Vogel’s recent interview with the somewhat reclusive billionaire philanthropist.
I’d like to add a few thoughts on this theme.
So what might explain Koch’s (presumably reluctant) embrace of tax increase? He seems to be one of the libertarians persuaded by William Niskanen’s critique of “starve-the-beast.” Briefly, Niskanen argued that (1) it was implausible that reducing the “price” of government would reduce demand for government; (2) the evidence of the post-Reagan era was that tax reductions tended to be accompanied by a lack of spending restraint while tax increases tended to be accompanied by an embrace of spending restraint; and (3) a fixation on cutting taxes had distracted the libertarian and conservative movements from pursuing reforms designed to curb the growth of public expenditures. One might reject Niskanen’s thesis, but it has certainly gained currency among at least some elite libertarians and conservatives.
This raises an intriguing possibility. What if David Koch’s high levels of political spending are the only way to protect a Republican president who decides to accept modest tax increases as part of a “grand bargain”? The conventional critique of billionaire-funded Super PACs is that they advance the narrow “income defense” and “wealth defense” interests of the superrich. Yet it is also true that the superrich are often less tax-sensitive than politically-engaged upper-middle-income voters, and so a politician who relies more heavily on tax-insensitive rich donors than on tax-sensitive HENRYs (Shawn Tully’s clever term for “high-earners, not rich yet”) might be more likely to back tax increases. One sufficiently committed or, if you prefer, zealous Koch brother can balance a very large number of doctors and lawyers and small-scale entrepreneurs.