For tax practitioners, tax is a rational subject. So, too, is tax law. Occasionally afflicted by illogical provisions, it nonetheless contains a variety of rules, marked by definitions, computations, and limitations, that can be applied, in most instances, by that most rational thing, the computer. Where objectivity fails, it involves issues such as valuation and purpose, raising questions that can be resolved through objective analysis of facts and circumstances.

For many taxpayers, tax appears to be an irrational subject, one that triggers emotions in a serious way. The recently concluded presidential campaign demonstrated that tax is no less a hot-button topic as are the several other issues that can polarize discussion and threaten to polarize a nation. Though it may appear that the principal emotion evoked by the mention of tax is anger, the underlying feeling almost certainly is fear.

Last week, I responded to a request to share my views for a TaxProf Blog post on "Tax Policy Under President Obama." I did so, and my short essay appeared with those contributed by 14 other tax law professors in Tax Policy in the Obama-Biden Administration. Some of the essays attempted to predict what that administration would offer in terms of tax legislation, while others, and some of those that attempted to make predictions, also contained suggestions and discussions of tax theory. In my essay, I emphasized that much of what was promised during the campaign by President-elect Obama would not be enacted or would be significantly modified, that the dire predictions fears made by Senator McCain and his supporters would not come to pass, that the tax law would remain complicated and become even more so, and that changing circumstance would derail some of the campaign proposals. In short, the essay was a preface to my What's Ahead for the Tax Law? post of last Friday. I also noted that the tax law would not change into what I would want it to be, that it would reflect compromise, and that it would continue to generate griping. Though making some rather safe predictions, I also peppered the essay with words such as "perhaps" and "possibly."

Many of the comments that were posted in response to the collection of essays were generally disappointing, though not surprising. It wasn't difficult to pick out the people whose unhappiness at Tuesday's election results and whose apprehensions of impending doom came through loud and clear in their postings. The overused and disproven canard of "socialism" showed its face, as did the assertion that the next administration would steal all the wealth. The essays were described as "a crock" and "embarrassing," threats of tax fraud and voluntary unemploymet were offered, and the fifteen law faculty who contributed were accused of doing nothing more than "discussing their pet peeves and wish lists." One post rested on the assumption that Obama promised to repeal all of the 2001 tax cuts. Another poster advised one of the essay writers to "lay off the meds." The anger is obvious, the fear isn't well hidden, and the ignorance that fertilizes those emotions isn't difficult to find.

The temptation to respond was too strong to resist. I pointed out that someone closely reading my essay would understand that it was not a wish list nor a collection of pet peeves. Though such lists and collections may have surfaced in some of the posts, lumping all of them together as sharing that characteristic is ignorant nonsense. My response also replied to the inquiry, "Does the fact that not one of these experts have any idea of what a President Obama would do, in spite of his innumerable promises, not give a moment's pause?," by explaining that the words "perhaps" and "possibly" were intended to reflect that unpredictability, and by wondering if those words showed up in invisible ink. I closed by sharing the thought that inspired today's post: "Sometimes I wonder whether rational analysis will ever trump emotional reaction."

The fear that taxpayers demonstrate, chiefly through angry comments, is thoroughly disproportionate to the disadvantages that they might face. Joe the Plumber became famous because he expressed his indignation at the very idea that if he managed to generate $250,000 of income -- presumably taxable income -- that his tax bill under Obama's stated plan would be more than that under McCain's stated plan. Had Joe bothered to do his arithmetic, he would have discovered that if his taxable income increased to $260,000, he would pay approximately $400 more under Obama's plan than he would under McCain's plan. Had he thought more, he would have had to admit that in order to make that sort of money he would be taking advantage of employees billed out at rates much higher than their salaries, and that Obama's response was an attempt to instill in Joe the Plumber some sense of obligation to pay back to society a very small portion of the largesse Joe could acquire by conducting business in a nation that protects him, his employees, his contracts, his suppliers, and his business. In other words, Joe, if you do manage to make that sort of money, you can't claim you did it on your own.

Yet somehow, significant numbers of taxpayers, almost none of whom would be disadvantaged by Obama's tax plan, became distressed, angry, and fearful that their wealth would be seized. Almost all of these taxpayers, and perhaps all of them, rallied to the defense of the taxpayers who supposedly would suffer when the tax cut enacted for them eight years ago was revoked or permitted to expire. Why would members of the middle class rush to the defense of the upper class, when the upper class surely won't go bankrupt on account of Obama's tax plan, and when the current economic travails of the middle class are attributable, in no small part, to the stock market and loan-making shenanigans in which those with excess wealth have engaged? Why does it seem so difficult or impossible for the middle class to understand that they are not targets of some wealth confiscation plan? Could it be that clever manipulators have taken the combination of ignorance and fear percolating in the collective subconscious of the middle class and whipped it into a frenzy that makes rational analysis impossible? As many intelligent tax experts, and others, have noted, Joe the Plumber was used.

The appeal to emotion is usually dangerous. It can be effective, but that effectiveness is almost always a short-term phenomenon and a long-term catastrophe. The appeal to emotion underlies most advertising, too much of political campaigning, all hate crimes, and most rumor-mongering. The appeal to emotion is everywhere. It pops up constantly in law school, where students too often begin their arguments or responses to a question from a moot court judge with, "Your Honor, I feel that…" rather than with "Your Honor, careful thought suggests that …" or "Your Honor, sequential analysis of the facts compels a conclusion that …" Though feelings may have a role to play when juries consider punitive damages or the death penalty, it makes little sense to argue that "I feel that section 163(h) allows the deduction." I truly hope that the student, the attorney, the tax practitioner, and the taxpayer would *think* that section 163(h) allows the deduction. Whether section 163(h) allows the deduction is a matter of rational analysis, not of emotional reaction.

The key to muting the anger about tax proposals that has become so rampant in recent weeks is to defuse the fear that fuels it. Fear is broken by knowledge and understanding. Knowledge and understanding are transmitted and acquired through education. The education need not be formal. It is the moral obligation of every educator, whether holding a formal position on a school's faculty or writing a blog, whether teaching a regularly scheduled class or dispensing information on a talk show or news network, to disseminate truth, to refrain from exaggerations and half-truths, to encourage rational discourse and discourage emotion-laden soundbites, and to realize that until fear is dispelled, knowledge cultivated, and understanding acquired, the nation's ability to restore itself, an effort that will involve the tax law in no small part, will be impeded.
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