Isaac Martin (2:52)

I'm a 20 year old barber and I owe the IRS $30,000 in taxes this year.

Noel King (2:57)

I need to come on here and ven taxes because I literally owe $3,400.

Isaac Martin (3:05)

What, where does my money go? Why don't I have a say, like Social Security? Why can't I opt out for that?

Eric Levitz (3:11)

And I think that what makes this, you know, really remarkable is that the Americans discontent is not tracking the objective level of federal taxes. So in 2025, Americans are about as upset with their tax burden as in modern history. And yet at the same time, the actual amount of taxes that they're paying, the rates that they're paying, are the lowest in modern history or just about.

Noel King (3:42)

All right, so who is upset about taxes? Is this a red America revolt? Is this a blue America revolt?

Eric Levitz (3:49)

Yeah. So I think that obviously the Republican Party is always more hostile to taxes and Republicans conservatives are going to express more aversion to them in polls. But what I think we've really seen and what's really significant is that both coalitions are trending in the same direction. Democrats aren't quite as far along as Republicans are, but they're both moving towards more hostility towards taxes.

Noel King (4:22)

Very interesting. Okay, so let's discuss what Americans are doing about our hostility. Let's talk first about predominantly red states, Republican led states. What's going on?

Eric Levitz (4:35)

Yeah. So since COVID we've basically seen red states wage war on property taxes.

Isaac Martin (4:41)

Especially $18 billion in property tax relief is coming for Texas taxpayers. Up to the average reduction in property taxes for Idaho homeowners is approximately 18%.

Sponsor/Advertisement Voice (4:51)

Connie Werner is raking in the savings. As a homeowner whose primary residence is in North Dakota. Connie will get $500 back on her property taxes next year.

Eric Levitz (5:01)

Now Republicans are really building on that. So, so, so this year in Florida, state legislators have advanced a constitutional amendment that would phase out all property taxes for non school purposes.

Sponsor/Advertisement Voice (5:14)

Is it your property or not? Just for being on your property, you got to write a check to the government every year.

Noel King (5:20)

Hmm. Wow. All right. So that's at the state level. I wonder about what's happening at the national level. So we had the big beautiful bill. The Trump administration was clear that it hoped that, you know, come tax refund time, Americans, especially wealthy Americans, wealthier Americans, would be very happy with the results. Truth social.

Isaac Martin (5:43)

So when you get your tax refund think about what a wonderful president you have. No tax on tips, no tax on Social Security for our great seniors, no tax on overtime. Don't spend all this money in one place.

Noel King (5:58)

What's, what's been up from the White House.

Eric Levitz (6:02)

Yeah. So like you said, last year, the Trump administration, along with Republicans in Congress, enacted a tax cut bill that costs well over $3 trillion. Much of that was extending the tax cuts that Trump had enacted during his first term in office. But he also created new tax breaks on top of those, including the much ballyhooed no tax on tips, which Democrats have subsequently embraced as well. And I think that that's really indicative of this larger pattern that's kind of defined American tax policy in the 21st century, which is a Republican president gets in. George W. Bush in the early 2000s, cuts taxes across the board.

Isaac Martin (6:52)

We must give overcharged taxpayers some of their own money back.

Eric Levitz (6:57)

Eventually, Democrats get back into power. They preserve the tax cuts on everybody

Isaac Martin (7:01)

but the rich in exchange for a temporary extension of the tax cuts for the wealthiest Americans. We're also able to protect key tax cuts for middle class families.

Eric Levitz (7:10)

Another Republican comes in, and they cut everybody's taxes down even further, but especially for the rich.

Isaac Martin (7:16)

We enacted the biggest tax cuts and reforms in American history.

Eric Levitz (7:21)

And then Democrat comes in, preserves the new baseline that the Republicans have set for everybody but the wealthy. Come on, folks. And so there's this ratchet down over the 21st century where what is considered kind of the normal bipartisan conventional wisdom about how much middle class Americans should pay in taxes keeps going down.

Noel King (7:43)

All right, so Democrats, as you point out, historically less hostile to taxes than Republicans and historically, like the kind of pro government policies that require people paying taxes. So what are Democrats up to?

Eric Levitz (7:58)

Yeah, so, you know, historically, as you say, Democrats are the party of big government, quote, unquote. You know, there's been a really a contradictory sort of evolution within the party over the past couple decades where Democrats have kind of gotten more ambitious about what they want to do in terms of increasing government spending on social safety net programs. But they're also increasingly terrified of calling for taxes on anybody but the rich.

Isaac Martin (8:33)

We impose surtaxes on people who make more than a million dollars a year, and billionaires. While we provide tax relief to hardworking Americans, no household in America should pay federal income tax on their first $75,000 of earnings.

Sponsor/Advertisement Voice (8:50)

Keep your money.

Eric Levitz (8:52)

This is in part because the base of the Democratic Party has become increasingly affluent. In the Trump era, college educated voters shifted very strongly towards the Democratic Party. While non college educated voters shifted towards the Republicans. And so Democrats have never been more reliant on the upper middle class for votes than they are today. And that's led to things like under Obama, the Democratic Party's pledge was that it wouldn't raise taxes on anybody making less than $250,000 a year. But by the time Biden comes into office, that's 400,000. And so, yeah, there's also been in this particular moment in 2026, this other smaller but interesting development of the emergence of a kind of anti Trump, anti tax resistance movement, or at least some resistance influencers have started arguing that anyone who pays their taxes is funding Donald Trump's wars and ICE detention facilities and that we all therefore have a civic responsibility to cheat the irs.

Noel King (10:02)

And I'm just really glad and thankful to not be participating in this sham of an American political system and internal revenue system, because the government is using my tax dollars to build concentration camps for my neighbors. And so I don't feel like giving them my tax money.

Isaac Martin (10:16)

Tax strike 2026.

Eric Levitz (10:18)

Spread the word.

Noel King (10:19)

Hmm. All right. So everybody is finding a reason why they should not have to pay. What happened? Why are we all so irate?

Eric Levitz (10:29)

You know, I think there are a few things. One post Covid inflation made people really sensitive to their costs. At the same time, also, the post Covid boom and the inflation led to an increase in property values. As the price level goes up, the value of homes go up, and that potentially increase people's property tax assessments and increase their nominal property taxes. But also, I guess as we kind of referenced with this resistance movement, to withhold your taxes in order to stick it to Trump, there's this declining trust in our government and especially declining trust in the other party. And so, you know, fundamentally, if you think that one of your nation's major political parties, which tends to be in power about half the time, is morally abominable and is going to do absolutely outrageous things with the government funds available to them, then you might not want to give them more of your paycheck.

Noel King (11:41)

All right, so historically, in our part of the world, tax revolts are something to on occasion, take seriously. Right. 1773 Tea party in Boston, and then later on some other Tea Parties. So, so, so I'm inclined to take this seriously, that everybody's agitated about paying taxes and some states are saying, we're going to make you pay less. Where do you think all of this is going? How serious is this?

Eric Levitz (12:09)

So I think we're on this real collision course where both of the major parties are going to need to confront the fact that they're, they have essentially taken a bunch of positions that do not mathematically work with each other, that Democrats are really committed to expanding the social safety net dramatically and yet they have no appetite for broad based tax increases and in fact are now flirting with large tax cuts. They have this tension between they want to build the welfare state, they're increasingly reliant on upper middle class voters who they don't want to tax Republicans, they are increasingly dependent on the votes of working class and older voters who value the existing social welfare state. And yet Republicans want to cut taxes more and more and more. And so over the coming decade, we're going to have to decide, these two parties are going to have to decide, you know, what is it that they really value? How important is it to them to embrace this tax revolt and just keep driving revenue down? Are they willing to pay the costs of that? And we're gonna have to find out.

Noel King (13:30)

Vox's eric levitz when we return the last great american tax revolt.

Sponsor/Advertisement Voice (13:48)

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Archival/Guest Voice (17:29)

Now a Spot announcement. Thank you. Spot.

Isaac Martin (17:33)

Here we go. Explained My name is Isaac Martin. I am a Professor of Urban Studies and Planning at the University of California, San Diego.

Noel King (17:44)

All right, so we learned in the first half of the show that Americans are in a bit of a mood about taxes. We don't want to pay them. This is not the first time that this has happened and you, in fact, studied one of the last times that we went through this. It was in the 1970s. What was going on back then.

Isaac Martin (18:03)

There was what we call now the property tax revolt, a major sort of grassroots movement of protest against local property taxes. It was a nationwide thing. It happened in communities all around the US from the nation's capital. The American Enterprise Institute for Public Policy Research presents today's topic, Taxpayers Revolt. But people really remember the events in California because Californians at that time, in 1978, amended their constitution to limit the property tax.

Archival/Guest Voice (18:41)

There are many who believe this is the beginning of something that will go far beyond California. And it is true that 20 odd states already have something in the works more or less similar to Proposition 13.

Isaac Martin (18:53)

And that tax limitation, which they called Proposition 13, then became national news and had all kinds of impacts in and outside of California.

Noel King (19:03)

Proposition 13. I lived in Los Angeles for a couple years. I remember Proposition 13, actually. I remember it being like a big topic of conversation, but not everyone will know of its history. Why does Prop 13 matter? Why is it, like, such a big deal?

Isaac Martin (19:18)

Proposition 13 is a big deal for a few reasons. The first is that it really very dramatically changed the state's tax structure. It did a few things all at the same time. First, it said local governments cannot levy any property tax in excess of 1%. So it capped the property tax rate at 1%. The second and more important thing it did is it put an annual cap on the amount that the assessed value of your property for tax purposes could increase from year to year. So even if your home was, you know, appreciating in value very rapidly, as far as the local tax assessor was concerned, it wasn't actually going up more than 2% per year in value. And that, among other things, constrained the finances of local governments in California. But it also gave property owners a tax break that grew over time the longer they stayed in their homes. It was the beginning of a real cascade of similar changes to California law, including later initiatives in the 1980s that said, that tax break you have on your home, because you got in early, you can pass that down to your children, you can pass that down to your grandchildren. That's one reason why Peter Schrag, who was the editor of the Sacramento Bee for many years, said in the 1990s, Listen, we now have a hereditary aristocracy of property in California. The story of Proposition 13 in California matters for at least a couple of reasons. One of those reasons is that it's a real cautionary tale that you can really lose something very Valuable if you just allow your anger at taxes to take over and you don't think carefully about what to do with that anger. As I understand it, it's a story of sort of the simplest, worst solution to a real crisis.

Noel King (21:14)

Where does this thing, Prop 13, where did it come from?

Isaac Martin (21:18)

First off, property taxes have always been a mess in America. Property taxation is the oldest tax we have in the United States. It predates the republic. And until the middle decades of the 20th century, the property tax really was still being administered as if we were in the horse and buggy era. So the people who were in charge of figuring out how much your house or your business was worth for the purpose of taxing it, they were political animals. And they didn't tend to have much expertise in actually appraising property. Instead, what they would do is just kind of write down from year to year, oh, we wrote down this number for your home last year. Let's write it down again this year.

Sponsor/Advertisement Voice (21:57)

Let's see here. In 1949, we said it was $10,000. It's 1950, so how about $10,000?

Isaac Martin (22:04)

So they were giving away these kinds of informal tax breaks to people in a way that was often also very political. They might trade a low assessment for bribes. They very commonly traded low assessments for votes.

Sponsor/Advertisement Voice (22:21)

Thanks for the tip, sir, and I can count on you in November.

Isaac Martin (22:24)

And in the 1960s, led by California, many states then began to reform how they administered the property tax. They brought in computers, they professionalized assessment. And suddenly, for the first time, many, many property owners, especially homeowners in the United States, started to get taxed on the values, the actual values of their homes for the first time.

Noel King (22:47)

Uh oh.

Isaac Martin (22:48)

And it turned out they didn't like that. It was, you know, a cause of an incredible freakout. People petitioning to abolish the property tax. One of the most colorful figures in the movement was a real crank named Howard Jarvis.

Archival/Guest Voice (23:04)

Devon is filled with moochers and loafers right up to their ears, and they have a great idea. The object of a lot of them is to get the job and sit there till they get a paint job, and in the meantime, they don't move in any direction.

Isaac Martin (23:19)

Who was a Los Angeles entrepreneur, kind of serial entrepreneur, who first in the late 1960s, campaigned to abolish the property tax and got nowhere with it, but did get enough traction that he decided it was worth continuing to try. Jarvis found inspiration for his Passion Prop

Sponsor/Advertisement Voice (23:37)

13 campaign in the 1976 Academy Award winning film network I'm As Mad as

Eric Levitz (23:43)

Hell and I'm not going to take this anymore.

Isaac Martin (23:46)

And so then he teamed up with a used car salesman named Paul Gann and took inspiration, actually, from the Los Angeles property assessor, who was also arguing for property tax reforms, a guy named Phil Watson, and wrote in a limitation to state constitutional amendment to limit taxes that became Proposition 13.

Archival/Guest Voice (24:08)

Here in California in the primary tomorrow, people have the rare and no doubt pleasing opportunity to vote their taxes down.

Isaac Martin (24:15)

And they collected more signatures than any ballot initiative in the history of California. And in June 1978, a majority of the voters went for it.

Archival/Guest Voice (24:22)

We have proven here in California that we the people, not the politicians, are still the bus.

Noel King (24:34)

Why did a majority of voters go for it? Was it hard to convince people?

Isaac Martin (24:38)

Jarvis wrote later in his memoir that the best argument was simply to go up to people and say, sign this. It will lower your property taxes.

Noel King (24:46)

Hmm. All right, so the upshot is what exactly what happens after voters say, yeah, this is what we want.

Isaac Martin (24:53)

Quality of services in many cases declined. So it's clear, for example, that there was a shift in fire protection away from professional fire departments towards volunteer fire departments in some parts of the state. It hurt the schools. School finance has continued to, of course, increase in California, as it has elsewhere in the US But California used to be at the top in terms of sort of quality of education and primary and secondary education and in terms of school spending, and now it's definitely not.

Noel King (25:24)

Many critics say Prop 13 is to

Eric Levitz (25:26)

blame for the decline in funding for California schools.

Isaac Martin (25:30)

You see pupil teacher ratios start to skyrocket in the years immediately after 1978. It has hurt the quality of infrastructure, potholes in the roads, response times of first responders. It has shifted the state tax structure onto income taxes, which means that the tax system in California is really swingy. In a boom, a lot of money might flow into the state's coffers. In a recession, the state budget really suffers, especially during the financial crisis. This meant that local governments that no longer could rely on a lot of property tax revenue were especially vulnerable to bankruptcy.

Noel King (26:12)

Today, San Bernardino leaders are expected to declare a fiscal emergency.

Isaac Martin (26:16)

And good morning sun rising on a new day in Stockton. But the local newspaper headline pretty much says it all. Bankrupt. It has also created all kinds of unfairness, new unfairness, rather unlike the old system. So now you might actually pay a lot more tax than somebody else in your neighborhood who again, has an identical home worth the same amount of money just because they bought their home earlier than you did. And they might agree that that's unfair, but they might not vote to change it because it's an unfairness that allows them to stay in their home you're

Noel King (26:50)

aware that Americans are growing irritable about paying taxes and I wonder whether you think it's fair to look at California and see a warning about where the rest of the country might be headed I do.

Isaac Martin (27:02)

I mean I think the history of California really teaches us that you can want your government for free but you can't get it for free the lesson here is that we really value and should value a lot of the public services public goods that our governments provide that doesn't mean that they shouldn't operate efficiently but it does mean that you know when you think about how much you're willing to pay for them you also have to pay attention to what you're willing to give up.

Noel King (27:35)

Isaac martin of ucsd miles bryan produced today jolie myers edited patrick boyd and david tadashore engineered and gabriel donatov checked the facts I'm noel king she's today explained it.