Interest groups have a strategy that gets them what they want whether Republicans or Democrats are in charge of the government. They get legislators to ignore their own self-interest in the policies they’re pitching and instead pretend that these favors are about expanding assistance programs or cutting taxes.

Public assistance and lower taxes are key features of partisan identity. Republicans want less taxation, and Democrats want more assistance programs. If you want to appeal to Republicans, you call for lower taxes. If you want to appeal to Democrats, you ask for more assistance programs.

Both assistance and tax cuts are versatile ways to deliver favors. But honest people on the left and the right should object.

Democrats seem to have no problem giving subsidies to the wealthy when these are cast as assistance programs. Progressive lawmakers cheer when programs that deliver money to the poor are expanded to the upper class. They call them universal programs. Most progressives don’t even notice that this means giving money to people who need it the least, even when it causes antipoverty programs no longer to serve their function.

“I want to ensure no student goes hungry,” Gov. Gretchen Whitmer said in 2023 about her program to expand taxpayer-funded school lunch to wealthy families. If kids from wealthy families are going hungry, it’s probably not because taxpayers don’t pay for their school lunches.

Progressives ought to notice this. Giving social support to people who don’t need it uses resources that could otherwise go to people who do. Expanding eligibility for assistance programs to people who aren’t poor leaves fewer resources to help the poor. And that’s wrong. But if you package something as an assistance program, you’ll get interest from Democrats.

Conservatives are prone to a similar problem. Want money for your big government programs? Call for a tax credit. Your allies on the right will be more sympathetic. By shifting outlays from the spending side of the balance sheet to the revenue side, this method wreaks havoc with the budget process. But it seems like a reduction in taxes, so Republicans like it.

Put a $1,000 earmark in the budget and conservatives get skeptical about the favor. But a $1,000 refundable tax credit appeals to Republican lawmakers. The recipient walks away with a $1,000 check in both cases. But the earmark is considered government spending, while the tax credit gets treated as a tax cut.

Most tax credit programs are just spending programs under a different name, but conservatives are more likely to support tax credit programs than spending programs. The Earned Income Tax Credit gives refundable tax credits to families with children, with eligibility extending into the middle class. Few Republicans would authorize a new spending program with these features, yet they approve of it as a tax credit.

The Earned Income Tax Credit might be better structured as a spending program, because bureaucrats are better at checking eligibility than tax administrators. Under the existing policy, 25% of EITC recipients collect benefits they are not eligible for.

Ambiguity about whether a policy is a tax cut or an assistance program blinds lawmakers to the weaknesses or merits of the program. Conservatives overlook the basic problems of a tax credit that they wouldn’t ignore in a spending program. Progressive ignore problems in spending programs that they would oppose in tax policy. There are better ways to feed hungry children than paying for rich kids’ meals. There are better ways to help the poor than a program that makes 25% of its beneficiaries tax cheats.

Interest groups take advantage of these blind spots.

Conservationists can get Republicans to approve a program to pay landowners for conservation activities by framing it as a tax abatement. Corporate interests persuade progressive Democrats, who aren’t interested in cutting corporate income taxes, to write checks to big companies by promising that the payments will provide green jobs, secure manufacturing, or in some other way provide public assistance.

Citizens and politicians alike need to know when to drop their partisan narratives. Although there are important and partisan debates about making assistance programs bigger or cutting tax rates, these arguments are a form of camouflage for favors to special interest groups.

State, local and federal policy are filled with favors to some at the expense of others. It’s also filled with partisan narratives that interest groups can exploit.

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