National income tax: a century of progressive taxes. More ahead?

National income tax was a key victory for progressives after Gilded Age when money ruled. The 16th Amendment, authorizing a national income tax, was the first new amendment in 40 years.

By , Guest blogger

  • close
    US Sen. Charles Schumer (D) of New York discusses House Speaker John Boehner's Plan B on fiscal reform at the Capitol in Washington this past December. A century ago, progressives instituted a national income tax with the idea that those who made more would pay a higher rate than those who made less.
    View Caption

Exactly a century ago, on February 3, 1913, the 16th Amendment to the Constitution was ratified, authorizing a federal income tax. Congress turned it into a graduated tax, based on “capacity to pay.”

It was among the signal victories of the progressive movement — the first constitutional amendment in 40 years (the first 10 had been included in the Bill of Rights, the 11th and 12th in 1789 and 1804, and three others in consequence of the Civil War), reflecting a great political transformation in America. 
The 1880s and 1890s had been the Gilded Age, the time of robber barons, when a small number controlled almost all the nation’s wealth as well as our democracy, when poverty had risen to record levels, and when it looked as though the country was destined to become a moneyed aristocracy.

But almost without warning, progressives reversed the tide. Teddy Roosevelt became president in 1901, pledging to break up the giant trusts and end the reign of the “malefactors of great wealth.” Laws were enacted protecting the public from impure foods and drugs, and from corrupt legislators. 

Recommended: Fiscal deal will cost you: 8 tax changes

By 1909 Democrats and progressive Republicans had swept many state elections, subsequently establishing the 40-hour work week and other reforms that would later be the foundation stones for the New Deal. Woodrow Wilson won the 1912 presidential election. 
A progressive backlash against concentrated wealth and power occurred a century ago in America. In the 1880s and 1890s such a movement seemed improbable if not impossible. Only idealists and dreamers thought the nation had the political will to reform itself, let alone enact a constitutional amendment of such importance — analogous, today, to an amendment reversing “Citizens United v. FEC” and limiting the flow of big money into politics. 

But it did happen. And it will happen again.

The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. This post originally ran on www.robertreich.org.

Share this story:
 
 
Make a Difference
Inspired? Here are some ways to make a difference on this issue.
Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.
 

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...