State, tax politics, and the limits of american liberalism. Professor michael more looks at tax policy and American Attitudes towards taxes from the end of the new deal, to the 1986 tax reform act. This top is warning the series with scholars who used records in the National Archives center for legislative archives for the research. The center senate hosted this amendment right of the video. Thank you for attending todays researcher top historian at the center for a legislative archive sponsor of the series. Weve had a very full program this year, showcasing some of the Significant Research that is still being, done in the house records. Todays top is the eighth of this calendar, near and we have one more november, then we will hear from Charles StewartPolitical Science professor at mit, longtime friend and supporter. Of the center. Who is talk about his coauthor book electing the senate, in direct democracy before the 17th amendment. By the prince in your city press, it will be a pretty good top. I have been looking forward to hosting todays guess, molly michelmore, since i first saw her in action, at last years policy history conference, tearing a panel that included who we heard from a research top last december. And that will include carla henri, text historian, who is in the audience today. Thank you for attending carl henry. And we will hear from him soon. Molly is an associate professor of history at washington university, received her ph. D. Degree from the university of michigan. She is the author of the highly regarded packs and spend, the welfare state tax politics, and the limits of american liberalism. She will also Say Something about her current book project, which builds on tax and spend, and is wonderfully titled as a taxpayer and, Citizen Rights obligations for democracy in the modern america. We should have time for q as, please raise your hand so we can passed a microphone, and pick you up on the recording, thank you for attending. And thank you, molly. Thank you, very much. Thank you very much for inviting me down here today. Thank you all for taking the time out of your busy day, is to come here in your time to talk about history. Its a heavy lift. So i appreciate you all coming down to hear me talk, a little bit today. I wont think of course the National Archives, and all of the archivists who make it possible for historians to do what we do. So much of this historical job is to look beneath the surface, and to use unpublished archives to put together these stories of the past. Sort of we are coming out here today, because im made basically the same job every day for about two years, while i was doing research in the reigning room, upstairs. Since so its kind of surreal to come back not as a 27yearold or 25 your gadget student, but as an employee, luckily employed professor of history. It does sort of make that trip again, and the difference that feels amazing but also a lid. Today, i really want to sketch out the political history of the federal income tax as well as talk a little bit about my book, as well as the ways the National Archives sort of help me to put together the story that i tell in the book about the relationship between taxes and spending policy, mostly in the post new deal period. About 1936 to 1986, with the tax reform law of 1986. Thats basically the scope of the book. Also, i would like to then offer some thoughts about why and how taxes a move to the center of american politics and american political thought in the last four years. The role that taxes and tax politics played both in sustaining the liberal order of the post world war ii period and in animating the conservative challenge of that consensus in the last four decades. First, a little bit about myself. Where is my clicker . My interest and taxes grew out of my interest in the welfare state. I actually began my career in graduate school as a historian of the welfare state. I began with mothers pensions, were a progressive era Welfare Program that sort of provide the basis for age dependent children. The First FederalWelfare Program inaugurated in 1935 as part of the Social Security act. Even as an undergraduate, it seemed to me that historians were insufficiently attentive. That there wasnt enough attention given or thought of that taxes. After collagen before graduate school, i came down to washington d. C. And work on the hill for two years. First as a staff assistant on the senate side and then over on the house side. My boss on the house side work on the ways and Means Committee. So i had some firsthand experience working with the kinds of issues that i would later deal with in my own scholarship. So i was able to translate some of this experience. This stuff that he did not want to deal with was basically what i had to do. But i did manage to translate some of that experience, particularly sort of familiarity with legislative process, into my graduate work. Over the course of my six years in michigan, for which i spent here as well as that a college park, i began to understand that i was priority primarily a historian of the taxing state rather than the u. S. Welfare state. Although the two are, and remain connected, and its this connection that explore in the book. Over that same period, it was gratifying to see that others had recognize the importance of tax and tax politics as a field of historical inquiry. For one reason or another, historians have tended to leave taxes alone. We might be afraid of numbers. We generally try to outsource taxes and tax history to economists, two lawyers, and sometimes to political scientists. In the last ten years, there has been a sort of blossoming of historical interest in taxes we. Henry is one of the leaders in that field. Ajay has also done a great deal to bring taxes to the forefront of historical study. Tax and spend relies heavily on Archival Research, particularly i Archival Research done here the National Archives as well as the johnson and reagan president ial libraries and what was then the nixon materials project. I would like enough to be here while nixon stuff was still here. I did not have to travel in order to look at all of his records. Of the records house in this building, those of the Senate Finance and ways and Means Committee work particularly important. I also looked at the records of the joint committee on taxation as well as the joint economic committee. These records helped and putting together the history of the u. S. Income tax between 1945 and 1968. A period in which taxes did not always play a particularly visible role in National Politics. The sources also help me put together a portrait of the community and welfare tax experts who designed and implemented texan welfare policy in the two and a half decades after world war ii. Congressional sources were particularly important into chapters of the book that deal specifically with tax and welfare policy in the 19 sixties 1960s. These chapters rely heavily on the sources i found here. I also became intimately acquainted with two men, senator russell long here who was the chairman of the. Lets see, Senate Finance committee. Oh, technology. You are my friend, but also my enemy. Richard, do you know whats wrong here . Senator russell long, who was the chairman of the Senate Finance committee. He was particularly active on welfare issues. He was an opponent of the aid to families with dependent Children Program that replaced abc in 1961, as well as wilbur mills, the longtime chairman of the house ways and Means Committee. Really the sort of emperor of all tax policy in the 19 fifties and 1960 period. One of the main claims i make in the book, and i can probably do this old School Without any kind of tech support, although. I dont know, i feel a little make it appear without my powerpoint. I know is it down there . There you go. I dont know if any of you remember this, but when you were in Elementary School and the teachers could never get the video to play. Youre always like channel three, its on channel three. They are the stupidest people in the world. I just feel like you get to be a teacher you suddenly lose your ability to use technology. Even if you do it every day. Thank you very much. I hope that we dont have this particular issue again. Here is russia long talking to johnson. Here of course is wilbur mills, also talking to johnson. Again, probably also getting the famous johnson treatment. One of the main claims i make in tax and spend is while texas at periodic we played an Important Role in american politics, its not until the 1970s that they emerged as a major and perennial political issue. Although it is often assumed that americans always hated taxes and that American History can be imagined as a sort of 200 plus yet revolt against texas, for most of the 20th century, income taxes were, if not exactly popular, but a relatively accepted part of the social contract. Although conservative politicians and Interest Groups experimented with text politics in the years immediately following the second world war, it was not until the economic collapse of the 19 seventies 1970s that texas became a political issue, a part of the political issue, powerful enough to transform american politics. Party competition overtakes policy and tech politics as shown they grown even more heated after 1980, as mounting debt and budget deficits. Today, i would like to take a very brief tore through the history of the federal income tax. And again, off for a few thoughts as to how why and how taxes and tax top has now become a central feature of american politics. The United States experimented with a variety of tax systems in its 200 plus years. For most of the 18th and 19th centuries, American Finance dependent on tax revenue. On tariff revenue rather. The american constitution allow the federal government to lay and collect taxes, tariffs, to provide for the common defense and general welfare of the United States. At the same time, however, article nine, section nine of article onelimited the National Governments ability to oppose any direct tax, except in proportion to the census. This limitation on the federal governments taxing power no doubt reflected the framers fear of centralized power and political factions. Equally important, however, as historian Robert Einhorn has shown, these constitutional checks on the governments power stems directly from slave holders concerns. So boulders, many of whom held key political positions in the early republic, fears that the nonslave holding majority would want to use the federal governments texan power to abolish slavery. Essentially by making it prohibitively expensive. As patrick cannery told his federal virginians in 1788, as virginia was considering whether or not to ratify the constitution, a federal government with a power to tax might someday impose a federal slave tax, hefty enough to quote, compel the Southern States to liberate their slaves. Between 1787 and 1862, American Finance dependent almost exclusively on tariffs and the National Level and property taxes at the state and local level. The American Civil War however was too expensive to pay for through these kinds of duties. To pay for the war, the union a post the nations first income tax. It texting comes over 100 dollars at a flat rate of 3 . This tax eventually affected 10 of northern households and the confederacy did not have a similar tax. This experiment with Income Taxation in the 19th century was short lived. The decade after the war, Congress Allowed the income tax to expire. Tariffs again dominated National Finance in the decades after the civil war. By the 18 eighties, a series of Economic Crises as well as the post restriction reconstruction return of the Democratic Party to National Politics weakened support for tariff based finance and propelled a Popular Movement in favor of a progressive income tax. The progressive income tax was first introduced by the peoples or populist party. The platform and representatives of this was shown in that picture. That populist Party Platform introduced in 1892 included a plan endorsing a graduated income tax to restore the government of the republic to the hands of the plane people with which class originated. Democrats soon coopted parts of the populist agenda including the progressive income tax. In 1894, Congress Approved a 2 increase in income tax on incomes over 200,000 dollars. In 1895, the Supreme Court found detects to be unconstitutional. Despite the courts ruling, however, progressive income tax remained a popular policy thanks in part to rising concerns of the unequal concentration of economic and political power in the hands of a very small elite. Party politics followed popular support. By 1908, both the gop and Democratic Party supported some kind of a National Income tax. Next year in 1909, congress, both the house and the Senate Approved the constitutional amendment giving congress the power to lay and collect taxes on incomes without regard to census or enumeration, thus getting around the supposed prohibition in the constitution on direct taxation. The 16th amendment was eventually approved by the states and took effect on february 25th, 1913. The first texan acted under the 60th and that 16th amendment was relatively modest, imposing only and 1 rate on personal corporate income. Only about 2 of americans were subjected even to this very minimal tax. The tax burden they go up in response to world war i. However, the world war one system only affected about 15 of American Families at its height. It did not survive. Treasury secretary andrew melon, the white house and congress agreed throughout the 1920s 1920s to roll back most of the wartime changes to the tech system. Even the Great Depression did not bring the income tax to the majority of people. Although Franklin Roosevelt adopted a populist rhetoric to justify increasing income taxes on the very wealthy to target what he called undesirable concentrations of great wealth. New deal tax policy relied heavily on both regressive consumption as well as the new payroll taxes in acted as part of the Social Security act. Excise taxes on liquor, which had the benefit of already being on the books, but having been in vance because the prohibition, became effective again in 1933 and generated huge amounts of revenue for the federal government. In 1936, for example, federal liquor texas raised 1. 5 billion dollars. That same year, the income tax raised only 1. 4 billion dollars. The federal income tax did not move to the center of american politics until the second world war. Planning for a war tax had begun as early as 1939. But of course, pearl harbor dramatically increased pressure for new federal revenues. Instead of excess profits or new general sales tax, congress and the administration agreed to keep the personal income tax at the center of American Finance. The new law lowered the personal exemption level and so transformed the income tax from a class tax, which had been paid by only a very small minority of very wealthy taxpayers, to a mass tax that affected the middle and even working classes. Between 1939 and 1945, a number of individual taxpayers crew from 3. 9 million to 42. 6 million. Over that same period, income Tax Collections group from only 2. 2 billion to 35. 1 billion. The 1942 law does transformed millions of americans almost overnight into taxpayers. To sell this new tax system, we have examples of this here, the federal government explicitly tied taxpaying to wartime patriotism. The campaign to convince americans to pay their taxes to beat the axis enlisted the help of such pop culture luminaries as urban burgling, who wrote the song i paid my income tax today. Every time i played in class, it gets into my head for the rest of the day. Irving berlin, danny kaye, roy rogers, and even donald duck, who starred in two short films produced by the Wall Disney Company for the department of the treasury. When these films, the new spirit of 43, donald de pays his taxes. Its actually really interesting. You can find them on youtube fairly easily. The answer a lot of questions that you might have about donald duck. For example, he is an actor if people did not know that. It does not explain why he does not wear pants. But it does explain what his job is and explains his relationship to you, do and louis. He described them as dependence on his tax form. Although i believe that the