Taxes dominate contemporary American politics. Yet while many rail against big government, few Americans are prepared to give up the benefits they receive from the state. InTax and Spend, historian ...Molly C. Michelmore examines an unexpected source of this contradiction and shows why many Americans have come to hate government but continue to demand the security it provides. Tracing the development of taxing and spending policy over the course of the twentieth century, Michelmore uncovers the origins of today's antitax and antigovernment politics in choices made by liberal state builders in the 1930s, 1940s, and 1950s. By focusing on two key instruments of twentieth-century economic and social policy, Aid to Families with Dependent Children and the federal income tax,Tax and Spendexplains the antitax logic that has guided liberal policy makers since the earliest days of Franklin Roosevelt's presidency. Grounded in careful archival research, this book reveals that the liberal social compact forged during the New Deal, World War II, and the postwar years included not only generous social benefits for the middle class-including Social Security, Medicare, and a host of expensive but hidden state subsidies-but also a commitment to preserve low taxes for the majority of American taxpayers. In a surprising twist on conventional political history, Michelmore's analysis links postwar liberalism directly to the rise of the Republican right in the last decades of the twentieth century. Liberals' decision to reconcile public demand for low taxes and generous social benefits by relying on hidden sources of revenues and invisible kinds of public subsidy, combined with their persistent defense of taxpayer rights and suspicion of "tax eaters" on the welfare rolls, not only fueled but helped create the contours of antistate politics at the core of the Reagan Revolution.
For years, historians, political scientists, sociologists, and others have refined the traditional image of the U.S. welfare state as a laggard or an incomplete one by paying attention to the unique ...ways in which the United States provides welfare to its citizens; the importance of race, gender, and class in the construction of welfare programs; and the existence of a hidden welfare state of tax spending, regulation, and macroeconomic growth-management policies. Goff correctly points out that these forms of settlement are, today, most often described as a distinctly foreign and even alien phenomenon unique to developing nations. ...shanties’ absence from the U.S. landscape, both in the present and in the imagined past, has been used by political, economic, and cultural elites as compelling evidence of an advanced state of living in the United States. ...Tani convincingly argues, “the material promises of citizenship remained thin . . . and continued to turn on exercises of local discretion” (p. 19). ...the law provided minimal protection while giving the poor “nothing more of substance than what the political process willed” (p. 273).
THINGS FALL APART Michelmore, Molly C
Tax and Spend,
12/2011
Book Chapter
Early in 1967, public opinion expert Ben Wattenberg issued President Lyndon Johnson a simple warning: the administration’s focus on the War on Poverty and the war in Vietnam threatened to cost the ...Democratic Party the affection and votes of the “middle-class working man in America.” Although it had been only a few years earlier that “union men had looked to the federal government for the same things that today the persons in poverty look for,” the landscape of middle- and working-class America had changed. Where American workers could once be found in slums they were now more likely to be
MARKET FAILURE Michelmore, Molly C
Tax and Spend,
12/2011
Book Chapter
In 1960, few Americans could have found Newburgh, New York, on a map, much less have been able to identify its local politicians. A year later, thanks to the well-publicized campaign by the city’s ...town manager, Joseph Mitchell, to rid the city of welfare “chiselers, loafers and social parasites,” Newburgh had become a household name.¹ Mitchell’s controversial “13-point plan” to reform the city’s welfare system—a plan that included a daily military-style muster of public assistance recipients in front of the Newburgh City Hall—made the small-town politician into a minor celebrity and transformed welfare into what Los Angeles Times
GAME OVER Michelmore, Molly C
Tax and Spend,
12/2011
Book Chapter
Early in the summer of 1980, Robert Johnson and Ron Pramschuffer, two enterprising Maryland businessmen of the “Archie Bunker persuasion,” figured out how to translate the rage of the “white lower ...middle class” into a board game.¹ Their brainchild, Public Assistance: Why Work for a Living When You Can Play This Great Welfare Game, hit the stores later that year, just in time for the holiday shopping season.² Modeled after Monopoly, the game retailed for about $16 and included a game board, four playing pieces, four identical pieces representing each player’s live-in or spouse, a set of cardboard pieces representing
In January 1947, Thomas Waxter, chief of the Baltimore Department of Welfare (BDW) announced cutbacks in the city’s public assistance programs and called on a local, nongovernmental group to ...investigate his department and recommend measures to “remedy any defects” in the existing system.¹ Only weeks later, the city’s largest daily newspaper, the Baltimore Sun, premiered the first in a seven-part series of front-page articles exposing how fraud, inexperience, and lax administration in the BDW had already taken considerable sums “out of the taxpayer’s pocket.”² That same year, in New York City, the local press’s discovery of a few families living
FED UP WITH TAXES Michelmore, Molly C
Tax and Spend,
12/2011
Book Chapter
In February 1973, a group of thirty St. Louis taxpayers dressed in eighteenth-century costumes celebrated the two hundredth anniversary of the Boston Tea Party by heaving food and medicine crates ...into the Mississippi River. Carrying signs that read “Fair Taxation or New Representation,” the protesters marched through the city, handing out leaflets attacking “unfair” and “burdensome taxes on food and medicine.” When they reached the downtown offices of the Missouri Department of Revenue, the protesters stopped briefly to affix their demands for tax justice to the door of the building. Message delivered, the group continued the march to the levee,
EPILOGUE Michelmore, Molly C
Tax and Spend,
12/2011
Book Chapter
The tax and welfare politics described in this study continue to shape American social and economic policy and to define American politics. Although “welfare as we knew it” no longer exists, thanks ...to the Personal Responsibility and Work Opportunity Act of 1996, the specter of welfare hangs over domestic policymaking. In the 2008 presidential race, Senator John McCain, who had fallen behind Senator Barack Obama in the polls, turned to tax and welfare politics as the closing argument in his effort to win over undecided voters.¹ “When politicians talk about taking your money and spreading it around, you’d better hold
PDF
