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Why hasn't anyone thought of this brilliant idea before? For most Americans, the biggest purchase they make during the year goes to the U.S. Government in return for services. Why on earth aren't we issued a receipt?

The folks at Third Way are leading the charge with this idea:

According to the IRS website, in 2008 the median tax filer in America had an adjusted gross income of $34,140 and paid $2,790 in federal income taxes. Assuming that all of that income was earned through wages, this filer would also contribute $2,610 to Social Security and Medicare through FICA. That is a total of $5,400 in federal tax and FICA payments. For most people, that is an enormous sum of money -- it certainly is for the median taxpayer.

Corn syrup, milk chocolate, sugar, cocoa butter, coconut, almond, soy lecithin -- any consumer can read these ingredients and their nutritional value on every package of a 75-cent Almond Joy. What is provided to a taxpayer with a $5,400 tax bill? Nothing. Consumers can easily see detailed information on every product they buy, but the largest item that they purchase in a given year -- their taxes -- they get nothing. They have a right to know what they are paying for.

For many Americans, the amount they pay in taxes is larger than any purchase they make during the year, but studies show they know almost nothing about where that money goes to. This contributes to ridiculous beliefs, like the view that 20% of government spending goes to foreign aid, for example. An electorate unschooled in basic budget facts is a major obstacle to controlling the nation's deficit, not to mention addressing a host of economic and social problems. We suggest that everyone who files a tax return receive a "taxpayer receipt." This receipt would tell them to the penny what their taxes paid for based on the amount they paid in federal income taxes and FICA.

And this is what it might just look like:

And for those suffering from a little bit of innumeracy, this is how those numbers are calculated:

How is this done?

It's really very easy. The total amount of federal spending is the denominator and the amount of money spent on a particular program is the numerator. The resulting quotient is the percentage of all federal spending that goes to that program. For example, the amount of money spent on Pell Grants in fiscal year 2009 was $19.38 billion, which is divided by total federal spending of $3.518 trillion.

This means that 0.55% of all federal spending went to Pell Grants. Multiply this number by the amount a taxpayer paid in taxes (in this case $5,400) and that means this person contributed $29.75 to Pell Grants.

Check out the .pdf from Third Way. Then go see what else they are prescribing to help us with our deficit problem.

It might go a long way to helping inform our fellow Americans. As Third Way says:

Most voters believe the budget deficit can be solved without touching Social Security and Medicare. Instead, they believe that government waste is the source of the deficit. In fact, entitlement spending already consumes half of the federal budget and will rise to two-thirds of the budget by 2030. Elected officials cannot offer meaningful choices about changing revenue and spending unless voters appreciate where federal dollars currently go.

You would think that most Americans would want to know where their biggest expenditure goes every year, wouldn't ya? Let's hope this idea catches on...

Both Ezra Klein over at The Washington Post and Kevin Drum at Mother Jones have given this idea great exposure. Read what they've said about it.

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