“There is no such thing as public money; there is only taxpayers’ money,” stated former British Prime Minister Margaret Thatcher.
That timeless truth should guide Iowa policymakers as they approach the challenge of property tax reform. Across the nation, states are stumbling over how to address property taxes. A common excuse is that the system is both technical and complicated. Iowa’s property tax system is indeed technical and complicated—but that cannot be an excuse to delay or prevent reform.
Because of this complexity, it is easy to lose sight of the main problem or to become overextended fighting a “war on a thousand fronts.” The real problem—the 800-pound gorilla in the room—is government spending.
As Iowa policymakers prepare for the next legislative session, they must remember that reform will not only be difficult, but it will require courage to stand against entrenched interests and obstacles. For inspiration, they need look no further than Prime Minister Thatcher.
Nicknamed the “Iron Lady,” Thatcher earned respect for her conviction and willingness to stand on principle. Throughout her career, she was a sharp critic of socialism and communism, and a defender of capitalism, limited government, and taxpayers. Like her ally President Ronald Reagan, she understood that government has no money of its own—only what it takes from citizens.
“If the State wishes to spend more it can do so only by borrowing your savings or by taxing you more. It is no good thinking that someone else will pay—that ‘someone else’ is you,” Thatcher warned.
This is a concept many local governments in Iowa forget. Too often, they act as though they have an unlimited claim on property taxes. Thatcher argued instead that government has a moral duty to be prudent with taxpayer dollars:
“Prosperity will not come by inventing more and more lavish public expenditure programs. You do not grow richer by ordering another cheque-book from the Bank. No nation ever grew more prosperous by taxing its citizens beyond their capacity to pay.”
Unfortunately, Iowa taxpayers know all too well how some local officials react when challenged. Citizens who attend council or board meetings often report being ignored, sidelined, or even told to identify budget cuts themselves. Local governments also rely heavily on scare tactics—claiming that tax relief would gut “essential services”—to discourage reform.
Thatcher, famous for her sharp debate skills, rejected the idea that higher spending and higher taxes drive growth, “I do say that no Government, whatever its political complexion, can suspend the laws of arithmetic or run away from reality,” she cautioned.
And she explained the balance required in governing:
“Protecting the taxpayer’s purse, protecting the public services—these are our two great tasks, and their demands have to be reconciled. How very pleasant it would be, how very popular it would be, to say ‘spend more on this, expand more on that.’ We all have our favorite causes—I know I do. But someone has to add up the figures. Every business has to do it, every housewife has to do it, every Government should do it…”
This is the balance that many governments ignore. Minnesota and Illinois, for example, are in fiscal crisis because they continue to tax and spend in pursuit of prosperity—a model that has repeatedly failed.
Iowa must take a different course. For too long, local governments have relied on automatic increases and windfalls, while telling taxpayers that “rates” have stayed flat even as bills rise. Honesty is missing from the system, and spending restraint is the only lasting solution.
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