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Tuesday, July 24, 2007

FDR and the Fall of the American Republic

Or quite nearly. We survived, but only after harrowing decades of depression. I believe it's useful to look back on the past. In this case, it should be both hopeful and sobering. Hopeful, because we've survived rough times in the past, and sobering because it shows how dark a nation, even America, can become. And certainly we aren't in any better political shape nowdays.

The following quotation is from President Roosevelt in a letter to the Ways and Means Committee:
In a message to the Congress on April 27, 1942, I stated:

"Discrepancies between low personal incomes and very high personal incomes should be lessened; and I therefore believe that in time of this grave national danger, when all excess income should go to win the war, no American citizen ought to have a net income, after he has paid his taxes, of more than $25,000 a year."

Thereafter the Treasury advised the committee:

"To implement the President's proposal, the Treasury now recommends the enactment of a 100 percent war supertax on that part of the net income after regular income tax which exceeds a personal exemption of $25,000 .

The following analysis is from Mark Leff, The Limitss of Symbolic Reform: The Newe Deal and Taxation, 1933-1939 (London and New York: Cambridge University Press, 1984), pp. 290-91.

FDR was a past master at the use of taxation to convey the image of the hour. He explained at one point that he would prefer "to see a tax which would tax all income above $100,000 at the rate of 99.5%" This even shocked his budget director, but the president's joking comeback was a revealing one: "Why not? None of us is ever going to make $100,000 a year. How many people report on that much income?" Roosevelt in fact wen even further than this. In 1942 and again in 1943, he proposed that all income above $25,000 ($50,000 for families) be taxed away, saying that "all excess income should go to win the war." Inequities, he warned, "seriously affect the morale of soldiers and sailors, farmers and workers, imperiling the efforts to stabilize wages and prices, and thereby impairing the effective prosecution of the war. When this income limit got nowhere in Congress, FDR acted on his own, handing down an executive order limiting after-tax salaries to $25,000 plus certain allowances, only to have his action indignantly repealed by Congress.

Why not? Nothing is more revealing than that short question, not only of FDR, but of the mindset of the left, because they have no answer to it.

Of interest, read
"Roosevelt's or Reagan's America: A Time for Choosing," from Hillsdale College's monthly Imprimis.


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