Taxes for Whom?
Working-class people rarely meet taxes as one clean bill. They meet a tax stack: federal, state, and local taxes; public fees and fines; rent pass-throughs; utility charges; health costs; private junk fees; and service cuts that make people pay out of pocket. When public money disappears into debt service, private contracts, developer subsidies, surveillance vendors, or programs with unclear outcomes, a tax-cut message can sound like common sense.
That resentment shows up in polling. In April 2026, 59 percent of Americans said their taxes were too high.[1] In December 2025, only 17 percent of Americans said they trusted the federal government to do what is right always or most of the time.[2]
The core question is not only whether taxes are too high or too low. The core question is who pays, who controls the money after it is collected, and what working people get back. Public money loses legitimacy when powerful interests capture it. It can regain legitimacy when it becomes housing, transit, parks, tenant enforcement, and real safety that people can see and use.
Why Tax Resentment Makes Sense
The tax debate usually starts with federal income tax. But that narrow frame misses the full stack of taxes mentioned above.
State and local tax systems are more uneven than they seem on the surface. The lowest-income households pay a higher share of income in state and local taxes than rich households, largely through sales and excise taxes that fall hardest on people who spend most of what they earn.[3] States sold as “low tax” often mean low tax for high earners, not low tax for poor and working-class residents.
Property-tax cuts can repeat the pattern. Local governments that keep property taxes low often make up revenue with more regressive methods.[4] In California, property-tax limits and carveouts can protect older and wealthier property owners as younger renters and buyers face higher costs renting and can’t purchase their own homes.
What Tax-Cut Politics Gets Right And Wrong
Republicans put tax cuts front and center, including the 2025 “no tax on tips” and “no tax on overtime” provisions.[5] The political appeal is clear: many people feel squeezed and do not trust government to spend public money well. The same federal law is estimated to increase deficits by $3.4 trillion between 2025 and 2034.[6] That many is going to be made up with service cuts.
Democratic tax politics has its own limits. Democratic leaders moved away from New Deal class politics, embraced balanced-budget and free-trade politics in the 1990s, and paired social spending with business-friendly limits rather than direct confrontation with capital.[7] The party’s current base leans toward professionals, affluent suburbanites, nonprofit and university networks, public-sector unions, and highly educated liberal voters. That coalition can support targeted relief, but it does not naturally lead with taxing wealth. There’s a reason Democrats now say they won’t increase taxes on households earning $400,000 or more.
The current Democratic tax offer mostly uses targeted credits and subsidies. The main tools are expanded refundable child tax credits, child care credits, Affordable Care Act premium subsidies, work-related tax benefits.[8] Those policies can help some households, but they are marginal relief that only helps manage the pain. They are not a simple class demand.
But when push comes to shove, the Dems priorities are clear. In 2022, Senate Democrats overwhelmingly voted down Bernie Sanders’s effort to add the expanded Child Tax Credit back into a reconciliation package after senators warned that it could sink the underlying bill.[9] During a parallel fight, some Democrats pushed to loosen the state and local tax deduction cap, called SALT Taxes, a benefit that helps high-income homeowners in expensive blue states.[10] Democrats often publicly defend tax credits for workers and children, but the muscle is put toward affluent homeowners, donors, and state-level business coalitions.
The deeper problem for socialists is the Democrat habit of subsidizing costs rather than taking basic needs out of private markets. Credits, vouchers, and subsidies can make health insurance, child care, housing, and energy cheaper for some households. But they can route public money through private markets at the same time. A tax credit for child care can support parents, but it can become a subsidy to a private child care market. Affordable Care Act premium subsidies can keep people insured, but they send public money through private insurers. The Low-Income Housing Tax Credit can produce affordable units, but it relies on investors and developers rather than direct public housing.
Every tax proposal should face the same test: does it build public capacity, or does it compensate households for surviving private markets?
What Public Money Should Do
The standard on the left should be easy: public money should become public goods, not private pipelines. Residents should be able to follow the money from collection to outcome. They should know who receives public funds, what those funds buy, what results are measured, and how failed contractors can be removed.
The Nonprofit and Contractor Problem
Nonprofits and nongovernmental organizations (NGOs) should not just be treated as villains. Many nonprofit staff do hard work for low pay in conditions shaped by austerity, scarcity, addiction, mental-health collapse, and state failure. The issue is not “nonprofits bad.” The issue is public work shifted into a privatized layer where wages, executive pay, outcomes, and democratic control are harder to see.
Corruption cases should be investigated - just because Republicans make a big deal out of them doesn’t mean they don’t hurt the legitimacy of using public dollars to help those in need. In February 2026, prosecutors charged the former chief executive of the United Council of Human Services, a homelessness-services nonprofit, with nine felonies. They alleged more than $1.2 million in misappropriated public funds and $91,000 directly stolen from the organization.[11] One case does not prove a whole sector is corrupt. It does show why open books, enforceable oversight, and public capacity matter.
Homelessness, Health Care, And Public Capacity
Homelessness spending shows why transparency is not enough. In 2024, California lacked current cost and outcome data for state homelessness programs. Some programs appeared likely to be cost-effective; others could not be fully assessed without better outcome data.[12] In April 2025, federal prosecutors in the Central District of California announced a homelessness fraud and corruption task force, citing billions spent, weak accounting, and a court-ordered Los Angeles audit with poor data quality and weak financial controls.[13]
Los Angeles spent more than $300 million on Inside Safe after December 2022 and moved about 5,800 people indoors, but about 40 percent of participants who went indoors had returned to the street by the program’s third year.[14] None of the 10 projects expected to open in 2025 under Proposition 1, California’s $6.4 billion mental-health bond, had opened by March 2026.[15] A 2021 estimate put homelessness costs for San Joaquin County public entities, nonprofits, and health care providers between $131.8 million and $160.2 million, or roughly $56,800 to $69,100 per person experiencing homelessness.[16]
To be clear, these numbers are not an argument against homeless people. They are an argument against a system that spends enormous sums without producing enough permanent housing, treatment capacity, or democratic accountability.
The health-care version follows the same pattern. In 2024, 80 percent of 2,425 nonprofit hospitals spent less on financial assistance and community investment than the estimated value of their tax breaks, with a combined deficit of $25.7 billion.[17]
Federal contracting shows the same pattern. Procurement incentives can encourage agencies to overpay contractors and outsource internal capacity.[18] When public agencies hollow out their own capacity, they become dependent on expensive contractors who then define the work.
The Bondholder Problem
Progressive taxes can leak back to capital if the spending system is captured. Municipal governments rely on a $4 trillion municipal bond market to finance infrastructure, with underwriters, credit raters, lawyers, consultants, and bondholders shaping what cities can do.[19] Taxing the rich is not enough if public money then circulates through opaque debt structures that enrich financial actors and discipline local governments.
Money and credit are public questions too. Democratic politics should contest the legal and financial chokepoints that make cities dependent on private money holders.[20] Tax politics should ask who has the authority to create credit, decide priorities, set debt rules, and govern public investment.
A Working-Class Tax Position
WCU should not be for high taxes or low taxes in the abstract. The position is working-class control of public money: cut the tax stack on workers, tax wealth and rents, and turn public money into public goods.
Taxes deserve support when they reduce private domination. Progressive taxes on high incomes, land speculation, corporate profits, and luxury real estate are defensible when they fund visible public goods and weaken private control over basic life.
Taxes deserve support when they are progressive. The state and local tax issue is not that government collects money. It is that too much money is collected from the wrong people through sales taxes, fees, fines, and flat charges. The burden should move upward, and the burden on poor and working-class people should fall.
Taxes deserve support when they build direct public capacity. Public institutions and public-sector workers are easier to hold accountable than a maze of vendors. They produce a visible answer to “what do we get back?”
Taxes deserve support when they are tied to democratic control: participatory budgeting, elected oversight boards with tenant and worker representation, public dashboards, contract disclosure, and direct control by the communities most affected.
Taxes deserve opposition when they are regressive, when they fall hardest on renters and workers, when they fund captured spending without clear outcomes, or when bond measures promise public goods but route too much money through finance and private developers.
The sewer socialism tradition: socialist municipal government built around public ownership, clean administration, and visible services is what we should look towards. The question “how do you pay for that?” is really a question about power: progressive taxation, expropriation, cuts to repressive budgets, and a working-class organization capable of defending reforms.[21]
Closing
Working Class Unity’s clearest position should not be anti-tax. It is anti-ripoff. It is not pro-tax. It is pro-public goods. It starts from the ordinary person’s correct feeling that they are paying more and getting less, and it points that anger away from poor people and public workers and toward the real issue: public money is not democratically controlled.
Gallup, “Americans’ Tax Views Remain Negative,” April 2026. URL: Americans' Tax Views Remain Negative ↩︎
Pew Research Center, “Public Trust in Government: 1958-2025,” December 4, 2025. URL: Public Trust in Government: 1958-2025 | Pew Research Center ↩︎
Institute on Taxation and Economic Policy, “Who Pays? 7th Edition.” URL: https://itep.org/whopays-7th-edition/ ↩︎
“Cutting Property Taxes for Seniors Is Bad for American Families,” Institute for Family Studies. URL: Cutting Property Taxes for Seniors Is Bad for American Families | Institute for Family Studies ↩︎
Internal Revenue Service, “One, Big, Beautiful Bill provisions - Individuals and workers,” updated May 6, 2026. URL: One, Big, Beautiful Bill provisions – Individuals and workers | Internal Revenue Service ↩︎
Congressional Budget Office, “Estimated Budgetary Effects of Public Law 119-21…” July 21, 2025. URL: https://www.cbo.gov/publication/61570 ↩︎
Neal Meyer, “Democrats Learned to Love Class Dealignment,” Jacobin, May 2025. URL: Democrats Learned to Love Class Dealignment ↩︎
New Democrat Coalition, “New Dem Tax Framework,” 2025. URL: https://newdemocratcoalition.house.gov/imo/media/doc/new_dem_tax_framework.pdf ↩︎
Julia Shapero, “Democrats quash Bernie Sanders effort to revive child tax credit,” Axios, August 7, 2022. URL: https://www.axios.com/2022/08/07/bernie-sanders-child-tax-credit-reconciliation ↩︎
David Sirota and Andrew Perez, “Dems Somehow Pretend This Mostly Helps The Middle Class,” Lever News, April 20, 2021. URL: Dems Somehow Pretend This Mostly Helps The Middle Class - The Daily PosterCommentShareCommentShare ↩︎
George Kelly, “Stolen cash, nepotism, and a trunk full of jewelry: SF homeless nonprofit CEO charged,” San Francisco Standard, February 23, 2026. URL: https://sfstandard.com/2026/02/23/gwendolyn-westbrook-charges-grand-theft-uchs-corruption/ ↩︎
California State Auditor, “2023-102.1 Homelessness in California: The State Must Do More to Assess the Cost-Effectiveness of Its Homelessness Programs,” April 9, 2024. URL: 2023-102.1 Homelessness in California - California State Auditor ↩︎
U.S. Attorney’s Office, Central District of California, “United States Attorney Bill Essayli Announces Criminal Task Force to Investigate Fraud and Corruption Involving Homelessness Funds,” April 8, 2025. URL: https://www.justice.gov/usao-cdca/pr/united-states-attorney-bill-essayli-announces-criminal-task-force-investigate-fraud ↩︎
“Under L.A. mayor’s $300-million homeless program, 40% have returned to the street,” Los Angeles Times, April 5, 2026. URL: Under L.A. mayor's $300-million homeless program, 40% have returned to the street ↩︎
Marisa Kendall, “10 projects from Newsom’s mental health bond were supposed to open in 2025. That didn’t happen,” CalMatters, March 12, 2026. URL: https://calmatters.org/housing/homelessness/2026/03/prop-1-update/ ↩︎
Steve Mann, “Hundreds of millions spent on homelessness in 2021 - just in SJ County,” Lodi News-Sentinel opinion. URL: Steve Mann: Hundreds of millions spent on homelessness in 2021—just in SJ County ↩︎
Lown Institute Hospitals Index, “Hospital Fair Share Spending, 2024.” URL: Hospital Fair Share Spending, 2024 ↩︎
Matt Stoller, “Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor,” BIG, December 5, 2019. ↩︎
David I. Backer, “Paying for It,” The Baffler, October 29, 2025. URL: Paying for It | David I. Backer ↩︎
Money on the Left, “Democratic Public Finance: A Radical Vision for Mamdani’s New York City,” October 10, 2025. URL: Democratic Public Finance: A Radical Vision for Mamdani’s New York City – Money on the Left ↩︎
Mike M and Ari S, “The Rise and Fall of Sewer Socialism,” Marxist Unity Group, June 11, 2025. URL: The Rise and Fall of Sewer Socialism — Marxist Unity Group ↩︎