I hesitate to break my self-imposed ban on writing about this topic, but the Supremes have declared that dollar-for-dollar tax credits do not constitute government spending:

The key to the Court majority’s opinion, written by Justice Anthony M. Kennedy, is that there is a clear-cut distinction between taxpayer lawsuits that challenge direct government spending to aid religion (still allowed, apparently, but perhaps only in the narrowest way), and lawsuits that challenge the use of a tax credit as an indirect way of channeling government tax revenues into parochial education (possibly, no longer allowed). The Court majority accepted the theory of the Arizona program’s supporters that the money that was going to the subsidized scholarships was not actually state tax revenues, but the donations of the taxpayers who put up the money — and then got a dollar-for-dollar cut in their state taxes. Further, the Court said the channeling of the money imposed no tax burden on the taxpayers who sued to challenge the program.

As I have argued before too many times, this may be correct as a matter of law; in this shell game, the money never enters the government’s coffers. But it’s ridiculous as a matter of economics: There is no difference between (A) having the government spend money on a program, and (B) having the government give dollar-for-dollar credits so that individuals can “donate” (i.e., divert their tax dollars) to that program. Either way, the government ends up with less money, the individual has not foregone a single dollar, and the program has more money.

The money the government loses from the credits, as well as any benefit it gains from the program (such as some kids’ being educated in private instead of public schools), are unchanged when you switch the funding mechanism. The sole advantage is political: School vouchers are controversial, and this scam allows politicians to claim they’re merely enabling “donations.”

Now that the matter is settled, though, the Democrats should agree to kill funding for Planned Parenthood — and replace it with dollar-for-dollar tax credits so that wealthy liberals can funnel all their tax payments to abortion providers. That should make everyone happy, right?