In a forthcoming book on public opinion toward the tax system, co-written with the political scientist Christopher Ellis, we argue that federal tax subsidies, even those that provide the most benefits to the top 1 percent, are wildly popular with the public. It is the peculiar political nature of the American masses that creates strong incentives for policymakers to use the tax code to finance popular social goals. This is the manifestation of a phenomena described by studies for more than 50 years: A large segment of the electorate can be described as “symbolically conservative but operationally liberal.” They report hating government while favoring federal assistance for more affordable health care insurance, old-age pensions and child care.
Tax subsidies are amenable to the American psyche because they provide social insurance that doesn’t feel like government welfare. In our research, we found that many respondents viewed tax subsidy recipients as more deserving of government aid than beneficiaries of identically described programs where the assistance was provided through direct checks.