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During World War II, the U.S. government needed to raise cash and fast. A team of experts that included an obscure young economist named Milton Friedman came up with income tax withholding. It was, as one senator put it, the best way to "get the greatest amount of money with the least amount of squawks."
Friedman, who would go on to become the high priest of the free market and small government, eventually appreciated the irony of that statement. He didn't regret suggesting withholding as a wartime measure, but he spent the rest of his life lamenting its longevity in peacetime.
"It never occurred to me at the time that I was helping to develop machinery that would make possible a government that I would come to criticize severely as too large, too intrusive, too destructive of freedom," Friedman wrote in his 1998 memoir.
Withholding numbs workers to the pain of their taxes. As the Treasury Department website explained as recently as 2009: Tax withholding "greatly eased the collection of the tax for both the taxpayer and the Bureau of Internal Revenue. However, it also greatly reduced the taxpayer's awareness of the amount of tax being collected, i.e. it reduced the transparency of the tax, which made it easier to raise taxes in the future."
Oddly, that fact sheet no longer appears on Treasury's website.
Withholding leaves naive taxpayers suffering from a kind of fiscal Stockholm syndrome. They actually celebrate when they get a tax refund, the way a broken hostage might thank a kidnapper who returns his property to him. A refund is when the government pays you back for the interest-free loan it forced you to make in the first place. Congratulations!
Withholding is corrosive to democracy for many reasons. The unspoken assumption is that the government's needs are more important than yours. Withholding means we are, in effect, working for the government before we are working for ourselves.
Worse, since taxpayers are anesthetized to the pain of paying taxes, we're becoming ever more disconnected from the product we are buying.
Why not make everyone write a check every quarter? Better yet, make them write a check once a year on Election Day. Comparison shopping works better when the price tag is in plain sight.
Jonah Goldberg is editor at large of the National Review Online.