The Nuclear Option: Wilson and Obama--100 Years Apart but so Alike
When Woodrow Wilson signed into law the Revenue Act of 1913, it probably sounded like a good idea.
Most people would pay less in taxes and the prices of everyday goods would drop, he promised. And the rich would — finally! — start paying their fair share.
In those days, tax collection was a highly diffuse business with various states and localities collecting taxes at various rates. The federal government mostly skidded by on exorbitant and uneven tariffs, and on booze and tobacco taxes.
This was always tough and disorganized business for the federal government. Those hardships became especially acute for the federal government when it wanted to launch wars thousands of miles away on other continents.
And, anyway, who could question the motives of Woodrow Wilson?
He was a celebrated professor with a sterling Ivy League background who ran for president on the promise to govern sensibly and never go to war. He maintained a grand worldview and would later be awarded the Nobel Peace prize in the category of “world organizing” on his gallant promises to establish lasting peace to end World War I, which would become mankind’s last war.
What could possibly go wrong?
If Vice President Joseph R. Biden had been alive back then, he could have described Wilson as “articulate and bright and clean and a nice-looking guy. I mean, that’s a storybook, man!”
At first, Wilson’s internal revenuers tiptoed into people’s wallets, taxing their hard work at rates that today seem laughable. The top marginal income tax rate was set at seven percent.
When one of America’s first tax cheats — none other than Woodrow Wilson himself — got busted for mistakes on his tax forms, it was dismissed as “of course, an oversight.”
In a 1918 letter to his collector of internal revenue Joshua W. Miles, Wilson requested, “Will you not do a busy man the favor of regarding this letter as an authorization to correct the mistake and to have a computation refigured accordingly?”
Not exactly the pleasant fellows working over at the IRS today.
Soon, the marginal tax rates began rising. By 1919, federal revenuers were deputized to enforce the 18th Amendment’s ban on the manufacture, sale or transport of intoxicating beverages.
And they have not left us alone ever since.
A hundred years after the establishment of the federal income tax, America and anyone who legally works here for a living continue to suffer under punitive laws that punish work. The harder you work, the steeper the punishment.
Today in America, the top rate of punishment for working is 39.6 percent.
Draconian? Yes, but we have a lot more wars to pay for today. Baby needs boots.
The tax code itself is now so monstrously complex that an entire industry has formed to interpret it for taxpayers. An even bigger industry of lobbyists has formed to bribe the government in the dark shadows of the cavernous code on behalf of wealthy interests.
Is it any wonder that today the IRS has become the political arm of a president who — much like Woodrow Wilson — believes the federal government must have vast, new powers to penetrate the most intimate and personal aspects of citizens’ private lives in order to help them in ways they never wanted?
Of course, Wilson’s catastrophic failure on the world stage was obvious. His League of Nations was naive, Ivory Tower claptrap. World War I, it turned out, was not mankind’s last war. In fact, the “lasting peace” Wilson brokered to end that war led directly to World War II.
If the Nobel Prize committee had any integrity or self-respect, they would demand that Wilson posthumously return the “Peace” award they gave him. But, then again, that might lead to an awkward precedent for the current occupant of Wilson’s seat in the White House.
Charles Hurt can be reached at email@example.com and on Twitter @charleshurt.