"The Price of Democracy"
By Gerald Scorse
Now comes a groundbreaking book that looks back not just
decades but centuries. It’s Vanessa A. Williamson’s The Price of Democracy: The
Revolutionary Power of Taxation in American History. The surprises never stop
coming.
Surprise No. 1, the Boston Tea Party. We’ve been brainwashed
into believing that taxes were the cause. Not so; the Sons of Liberty were
actually opposing the bailout of the “too big to fail” East India Company. As
Samuel Adams warned, the bailout was “introductive to Monopolies.”
Williamson says the colonists never objected to paying
taxes. “To the extent the American Revolution was about taxation,” she writes,
“it was about the desire of Americans to tax themselves…"
Come 1787, the new America had to decide what its own tax
policies would be. Next surprise, the framers of the Constitution agreed that
the wealthy few had to be protected from the masses. Listen to this from
Alexander Hamilton:
“All communities divide themselves into the few and the
many. The first are the rich and well-born, the other the mass of the people.”
As Hamilton saw it, the people “seldom judge or determine right.”
Thomas Paine saw things the other way around.
Everybody knows that Paine helped ignite the American
Revolution. Not many know that he wanted a tax revolution as well. Paine
worried about the “overgrown influence” of wealth, calling it “one of the
principal sources of corruption at elections.” He wanted marginal income tax
rates, topping out at 100%. Echoing Paine, an early New York newspaper
proposed that “men should by every fair means be legally prevented from
becoming exorbitantly rich”.
In 1857, the South was angered by a tax surprise of its own making: A little-known Southern writer, Hinton Helper, called for taxing slavery out of existence. His book, The Impending Crisis of the South, presented reams of statistics comparing the region unfavorably to the North. Taxes on slaves, he wrote, should be raised until they delivered “an infallible deathblow” to the practice.
Ironically, Helper was a racist. He wanted slavery abolished
only because it was economically crippling the Southern states. In 1988, the
late historian George M. Frederickson called Helper’s treatise “the most
important single book, in terms of its political impact,” ever published in the
United States.
Decades later, an amendment to the Constitution amended the
history of taxation in America.
In 1913, the Sixteenth Amendment gave Congress the power to
“lay and collect taxes on incomes, from whatever source derived…" Finally,
despite the constant opposition of the few, the many could now leverage their
numbers in shaping the nation’s tax policies.
They used that leverage to help create both Social Security
and Medicare, the two most egalitarian social welfare programs in America. The
votes in the House of Representatives (often called the People’s House)
were 372-33 for Social Security and 313-115 for
Medicare.
Over the years the programs have become prime examples of
how most Americans really feel about taxes: They’re happy to pay them when the
money goes toward a common goal.
They’re unhappy, though, with the most expensive welfare state ever created. It’s not for people who need anything, it’s for people who already have everything. It’s evolved over decades, paid for with zillions of tax break dollars and other giveaways, all redistributed to the few.
When they should have been distributed to the many, and made
a better America for everybody.
Scorse writes on taxes. He has been a frequent contributor of economic op-eds to Progressive Charlestown for many years.
