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Friday, January 06, 2012

REBUILDING THE REPUBLICAN PARTY

I would say that Bertrand Snell is a shinning example of the “Peter Principle”.You see,  Bertrand (above, with his ideological opponent, FDR) started out life as a bookkeeper. Then he successfully ran a cheese factory and a lumber company in upstate New York. He was well qualified to fill all those jobs. For a time he was even the president of a small college. All this success led, in 1915, to Bertrand being elected to Congress. In 1931 he became the Chairman of the Republican National Committee. That led, in 1932, to his being elected Minority Leader in the House of Representatives. And that made him the primary architect of the disaster which befell the Republican Party the first time they ran against the New Deal.  In short, it was Bertrand Snell’s fault. Of course, he had some help.
Herbert Hoover not only lost the 1932 Presidential Election but he lost it by almost 18 percentage points. His ineffectualness at dealing with the Great Depression (the stock market crash occurred 6 months into his term) was so obvious that Herbert won only 6 states – Pennsylvania, Delaware, R.I., Vermont, New Hampshire & Maine. And yet Herbert still had hopes he could engineer a come back, even though the New Deal had created six million jobs, had doubled industrial production and sent corporate profits from a $2 billion loss under Hoover to a $5 billion profit under Roosevelt. For one thing, business leaders were not backing Roosevelt, no matter how much he had done for the economy. 
On June 9. 1936, Herbert addressed the Republican Convention in the Public Auditorium in Cleveland, Ohio, and did his very best to rally the faithful to his cause. As Time Magazine detailed, “After 15 minutes (of) yelling, shrieking (and) hooting, (Hoover) was allowed to begin. …"Fundamental American liberties are at stake", he said. "Is the Republican Party ready…to cast your all upon the issue?", he asked  "Yes!" roared the crowd. "Have you determined to enter in a holy crusade for freedom which shall determine the future and the perpetuity of a nation of free men?" he asked.  "Yes!" roared the crowd, in ecstasy.” The faithful went on chanting “Hoo-ver, Hoo-ver, Hoo-ver,” long after Herbert had left the stage.
Noted Time Magazine; “The demonstration could not be stopped for half an hour, even when Speaker Snell tried to introduce a little old lady, surprisingly pert for her 77 years, the widow of President Benjamin Harrison.” Finally Bertrand banged the big gavel and informed the crowd that Herbert had already boarded a train for New York. The floor demonstrations paused for a breath, milled about in confusion for a few moments and then slowly petered out in disappointment.
 
Except...Herbert had not even left the building. He was waiting just off stage to be recalled by the carefully prepared demonstrations and proclaimed the nominee by acclamation. What Hoover had not counted on was that Chairman Bertrand had already determined that renominating Hoover would be a disaster for Republicans. Bertrand had decided the party nominee would be Governor Alf Landon, known affectionately to the faithful as “The Kansas Coolidge”  - a moniker certain to inspire the base. And there were reasons Bertrand was optimistic about the governor.
Alf was the only Republican governor re-elected in 1934. He had a reputation as a fiscal conservative who cut taxes and balanced the state budget. That made him the Republican wonder-kinder, the perfect man to oppose the “tax and spend” Roosevelt.
There were a few problems with that image, of course. First, Landon balanced the Kansas budgets because he was required by law to balance them, and even that had been possible only because the New Deal had pumped millions of dollars into the Kansas economy to offset the state deficits. Secondly, Alf publicly supported parts of the New Deal, so many parts that he was at odds with the Republican party platform. And the third problem with his choice as the nominee was that Alf was a terrible public speaker. He mumbled. And like any good mid-westerner even when speaking clearly he didn’t blow his own horn very much. As H. L. Mencken noted, he "simply lacks the power to inflame the boobs."  
The party platform had been engineered by Bertrand and forty-four year old John Daniel Miller Hamilton, the “crinkly haired” “jut-jawed” G.O.P.’s general counsel, who Republicans felt reeked of “animal vigor.” Hamilton was actually paid $15,000 a year to be the parties’ attack dog. He was described by one fellow Republican as having, “…a seven-devil lust to live and shine under the blessings of the rich”. Hamilton made Alf's nominating speech, and then read a telegram from the Governor promising to support the anti-New Deal platform, which Hamilton had helped to write.      
Said the platform; “For three long years the New Deal Administration has dishonored American traditions…has been guilty of frightful waste and extravagance, …it has created a vast multitude of new offices, …set up a centralized bureaucracy, and sent out swarms of inspectors to harass our people. It has bred fear and hesitation in commerce and industry, thus discouraging new enterprises, preventing employment and prolonging the depression….We pledge ourselves: To preserve the American system of free enterprise, private competition, and equality of opportunity.. We advocate: Abandonment of all New Deal policies that raise production costs, increase the cost of living, and thereby restrict buying, reduce volume and prevent reemployment. …”. To read the Republican platform you would have thought the nation was in much worse shape after the New Deal, than before.
Bertrand had a master plan for victory, funded by a $14 million war chest ($207 ½ million in today's dollars), with over a million dollars of that coming from just three families – DuPont, Pew and Rockefeller – and the rest almost entirely from business leaders anxious to prevent further Federal regulations of their business.
And then there was “The Liberty League,” described by one historian as “…the best-financed and the most professionally run…anti-big-government organization ever to come down the pike.”(At least until the Tea Party.)  The League raised and spent as much cash as the two established parties combined (30% of it coming from the DuPont family alone). Its national headquarters occupied 31 rooms in the National Press Building and there were 20 state branches. Hamilton confessed later, "Without Liberty League money we wouldn't have had a national headquarters."  
The campaign that followed saw the constant Republican repetition of attack. The New Deal became “The Raw Deal”. Franklyn Delano Roosevelt became “Stalin Delano Roosevelt”. William Randolph Hearst asserted in a pro-Landon editorial, “The Bolshevist tyranny in Russian has ordered all Bolshevists, communists and revolutionaries in the Untied States to support Roosevelt!" It all sounds so familiar, doesn't it?
 In late October 1936 the Republican National Committee sent checks for $5.00 to 400 black pastors in Maryland, along with a letter, which began, “Dear Brother,” and then argued that the G.O.P. had always done more to help blacks than the Democrats had.
The Young Republicans were founded during this election, to get out the youth vote. And fashion shows were staged to encourage women to support the party. Every show would start with a woman wearing a wooden barrel on suspenders, marked, “If The New Deal Wins”, followed by lovely models in Paris designs, marked “If Landon Wins." Women were expected to be swayed by such "fashion politics".
However, it appears that most Americans saw all of this Republican effort in the same light as FDR did, as illustrated by a story Roosevelt wrote himself for a speech he delivered in Boston. Said Roosevelt, “In the summer of 1933 a nice old gentleman fell off a pier. He was unable to swim. A friend ran down the pier, dived overboard and pulled him out. But his silk hat floated away with the tide. After the old gentleman was revived he was effusive in his thanks. He praised his friend for saving his life. Today, three years later, the old man is berating his friend because the silk hat was lost.”
 
The election of November 3, 1936 was the most lopsided since James Monroe ran unopposed in 1820. Eighty-three percent of eligible voters showed up at the polls and Roosevelt won almost 61% of their votes. He carried every state in the union except Vermont and Maine, giving rise to the Democratic twist on the old adage, “As Maine goes, so goes Vermont”.
 
Roosevelt won 532 electoral votes to Landon’s 8. Seventy-one percent of Black Americans voted Democratic, as well as 57% of women, 63% of men, 76% of low income voters, 80% of Catholics and 86% of Jewish voters. After the election the Democrats held the Senate, 75-16, and the House contained 332 Democrats to just 88 Republicans. Things would get even worse for the Republicans in the next few years. John D. Hamilton would say after the election, "The Lord himself couldn't have beaten Roosevelt in 1936, much less the Liberty League."
  
Maybe; but the election was the death knell of the Liberty League. They lingered into 1940, when the DuPont family finally pulled their funding, and the group then quietly died. Long before that John Hamilton had his own reactionary reckoning. In 1937 Hamilton's wife sued him for divorce, on the grounds of “gross neglect of duty, abandonment and extreme cruelty.” That same year Alf Landon had Hamilton removed as Party Chairman, as Landon rebuilt the party in his own Midwestern less reactionary less ideological image.
 
Under Landon's non-red baiting non-FDR hating guidance the party stopped trying to overturn the New Deal and began to climb its way back. The Republicans would gain strength until 1948 when it looked like they were certain to regain the White House. But in that campaign they gloated too much about finally overturning the New Deal, and that public gloating handed Harry Truman his re-election. It was not until Ronald Reagan in his 1981 inauguration speech that the G.O.P again openly called for overturning the New Deal programs like Social Security and the Minimum Wage. And thirty years later, they are still trying to sell those ideas.
And Bertrand Snell, the Minority Leader of House of Representatives? He had been one of the few Republicans re-elected in 1936. But he did not run again in 1938. Instead, he went into the newspaper business. He published the Potsdam, New York "Courier-Freeman" and ran it until 1949. He also became the owner of the New York State Oil Company. He was ably qualified for both of those jobs. He died in 1958, while a Republican had finally reoccupied the White House.  But even Dwight D. Eisenhower was a RINO (Republican In Name Only) in many conservative eyes. He was accused by the Republican right wing of running a "little New Deal", still just about the worst insult a Republican can imagine.
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Wednesday, January 04, 2012

OLD SMOKEY

I find it interesting that during the “carboniferous age”, our planet was far more flammable than it is today. About 420 million years ago the air was made up of 40% oxygen, compared to today’s 20%.  All this “extra” oxygen came from the exultation of plants which had run such a riot over the earth that they laid down the vast coal beds which we mine today. But this plant-foria also left behind extensive beds of charcoal, hinting at vast forests that had burned before they could become coal. Today, dead wood burns at 150 F. But with twice the oxygen available, that flash point must have been reduced to within a few degrees of the high temperature of a hot summer’s day. The Silurian Age was, in short, a global tinder box, a hell on earth. It was not the kind of world a little bear cub could survive in for very long.
More recent charcoal records tell an equally interesting story. It seems that before the twentieth century there were a greater number of forest fires in North America than since. As long as there was a frontier, flames were used to conquer the land. Native Americans burned swaths of grasslands and forests to trap prey, and Europeans burned them to convert woods into farms and grazing lands. But with the closing of the American frontier – which happened in 1880 according to Professor Jackson Turner - all the land in America became property. It was owned by somebody or some corporation or the government. It was then that fire became not a tool but a threat. It was a brand new way of thinking about fire. For the first time in history humans had made the moral judgment that fire was usually a bad thing.
In 1891, the Forest Reserve Act was signed by U.S. President Benjamin Harrison. It put 13 million acres of forest under Federal protection, so it could be managed to maintain water drainage and lumber sources. Wildfires still remained largely beyond human control, even when humans had started them. In Yellowstone, America’s first National Park, only those 6 to 10 wild fires each year which broke out along the roads were combated, while the 35 fires in the back country each year started by lightning were allowed to burn themselves out; then came the drought year of 1910.
They called it The Great Fire. It was started by lightening on August 20th, with 2,000 fires already burning in the forests of Idaho and Montana. Three million acres burned, as did the towns of Avery, Falcon and Grand Forks, Idaho, De Borgia, Haugan, Henderson, Saltese, Taft and Tuscor, Montana. The smoke was seen as far away as Watertown, New York. Eighty-six humans were also killed, including 28 members of “The Lost Crew” of firefighters.
That fall Henry Graves, Chief of the Forest Service, decided the key to fighting wildfires was the quick arrival at the fire by an adequate, trained force of fire fighters, armed with the proper equipment. And by 1935 enough resources had been committed to this fast response that the new Chief, Ferdinand Silcox, could order that all wild fires reported, must brought under control by 10:00 a.m. the very next morning. By 1939 the Forest Service had even established “Smokejumpers”, men who would parachute into remote back country and with shovels and hand axes, isolate a wild fire and tamp down any smoking embers. And that was when the story turned Hollywood.
On August 13, 1942 Walt Disney released his fifth animated feature film, “Bambi”. In the climax of the movie the adult Bambi and his father struggle to survive a raging forest fire. The Forest Service thought they had a good fit with that dramatic sequence and rented Bambi for use on wildfire warning posters. Unfortunately the movie was a disappointing dud financially, when the forerunners of the NRA protested this “insult to American Sportsmen,” since the movie showed hunters shooting Bambi’s Mommy. Disney decided to withdraw the characters for the duration of World War Two, which meant that the Forest Service had to go looking for another animated spokes-figure.
At the time the most famous firefighter in America was “Smokey” Joe Martin of the NYFD, who had just died in October of 1941, at 86. So the Adverting Council, which drew up the posters for the Forest Service, decided any new spokes-figure should be named for him. The very first poster of the new figure was released on August 9, 1944. It showed Smokey Bear (No “The” in the name) wearing blue jeans and a Forest Rangers’ hat, pouring water on a campfire. Three years later they added the caption “Remember, Only YOU can prevent forest fires.”
On Thursday, May 4th, 1950, sparks from a camp stove started a fire in the Capitan Mountain Range, of the Lincoln National Forest in northern New Mexico. It eventually burned 17,000 acres. One of the crews sent to deal with the conflagration was a unit out of Fort Bliss, Texas. Over a couple of days, while they worked, the men saw a black bear cub running around in the burning forest, and finally, on May 9th, they were able to capture him. He seemed to have been abandoned, was about 3 months old, and was burned and badly singed.
The crew named him “Hotfoot Teddy” and turned him over to local veterinarian Edward Smith, his wife Ruth, and their two children, 15 year old Donald and four year old Judy. Everybody fell in love with Hotfoot, except Judy, who according to her brother, kept expecting the bear to bite her. And yet it was Judy who was used as a prop when the photographer from Life Magazine showed up to take pictures of the little bear with the bandaged feet.
Over night the little cute bear cub had his own comic strip and his own cartoons at the movies. The Forest Service recognized the value of Hotfoot, and he was flown to Washington, D.C., rechristened “Smokey Bear”, and given his own cage at the National Zoo. And there he resided, loping back and forth on his still tender feet until 1976, when he died at the ripe old age of 26. They buried the old guy back in New Mexico, in the forest of his birth. And about the time he died, so did the moral judgment about forest fires being bad.
As the Smokey Bear baby-boomers grew up, a more nuanced vision of fire in the wilderness has taken root. The Forest Service no longer uses the phrase “Forest Fire”, exchanging it for “Wildfire.” In 1965 , 94% of the public approved of the under control by 10 a.m. policy. By 1970 that percentage had fallen to 46%, and by 2004 only 6%. Part of that was probably the cost of fighting the fires; in an average year over 84,000 wildfires burn over 3 million acres, at a cost of over $540 million, and the lives of 16 firefighters.
There is the perception that these numbers are going up, and but it is hard to measure that based on something less than a century of hard data. After all, the “Great Fire” of 1910 burned 3 million acres by itself. In 1988 Yellowstone Nation Park suffered 99,000 acres burned, 36% of the park. But nobody remembers the 1910 fire. Everybody remembers the fire of 1988. That’s human nature, and will never be cured. But...
...British and American statistical studies have come to the conclusion that the fire season has gotten longer by 78 days since the 1970’s. Anthony Westerling of the Scrips Institution summed up the situation this way; “With the snowmelt coming out a month earlier, areas then get drier earlier overall...There's more opportunity for ignition.” As Thomas Swetnam, of the University of Arizona has pointed out that, “Lots of people think climate change and the ecological responses are 50 to 100 years away. But...it's happening now…”
So poor old Smokey was lucky he was not born fifty years later, or he would have been in real trouble. That little cub had few tools for dealing with a fast moving forest fire, and none for climate change - but then neither do we. I mean, could we deal with twice the oxygen level that we have now? It would be helpful, I think, to remember we are not worried about climate change because of what it might mean for Smokey, or even Bambi. We should be worried about what it means for us.
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Sunday, January 01, 2012

AIR HEADS Part Nine THE WIND MACHINE

I guess you could say that Charlie Taylor (above) was the first member of the “Final Destination Club”. On September 17, 1908 Charlie was set to take his first flight with Orville Wright when an Army Officer asked if an Army observer could go up next, instead. It was in Charlie’s character to defer to the request and he gave up his seat.
So Lt. Thomas Selfridge was the passenger when the Wright biplane crashed to earth (above). Selfridge was killed on impact. Charlie was the first to reach the crash. He pulled the injured Orville out of the wreckage and then, after the doctors had taken his friend and boss away, it was Charlie who broke down sobbing. But it was also in Charlie’s character that he tore the wreckage apart until he found out exactly what had caused the crash. He was a painfully shy mechanical genius, the man who maintained the “Vin Fiz Flyer” most of the way across the continent. Without Charlie Taylor there would have been no transcontinental flight, and no Wright Brothers either - and they all knew it.
Charlie went to work for the brothers in 1901 at $18 for a sixty hour week in their bicycle shop (above), and he stayed because their personalities fit so well together. Explained Charlie, “The Wrights didn’t drink or smoke, but they never objected too much to my cigar smoking….Both the boys had tempers, but no matter how angry they ever got I never heard them use a profane word…(and) I never let go with anything stronger than heckety-hoo.”
Charlie and the brothers sketched out the world’s first wind tunnel on scrap pieces of paper, and then Charlie built it (above). Without that testing device, powered flight would have had to wait for accidental discovery. What the Wright Brothers and Charlie achieved was not just powered flight, but an understanding of how powered flight was achieved. And that made improvements possible. After letters to automobile manufactures failed to find a suitable engine, Charlie built the first aircraft motor (and only the second gasoline engine he had ever built) from scratch, in just six weeks, using only a drill press, a lathe and some hand tools. At every step of the Wright Brothers innovations, Charlie Taylor was vital to the process.
In 1911 Cal Rogers approached Charlie and offered him $70 a week - plus expenses - to travel with the “Vin Fiz Flyer” across country and keep it in the air (above, Charlie and Cal, repairing the Flyer.). “At the time my wages were $25 a week," explained Charley. "I told him I'd go; then I told ‘Orv ‘about it. He asked me not to quit. I told him I had already given my word to Rodgers and couldn't very well back out. He told me to make it a sort of leave of absence, and to be sure and come back.” And that was how Charlie began what he later called “…my adventures”.
Charlie never had any doubt Cal would make it. He sent his wife and three children ahead to California to await his arrival. But Charlie was no diarist. He left behind no impressions of what it was like to be cooped up with Mable Rogers and Maria (Rogers) Swietzer for all those days and nights. But I am not surprised that Charlie quit not long before matters came to a head between Lucy Belevedere and Mable. I imagine the drama and the emotion made Charlie very uncomfortable. He jumped the train in Texas and hurried on to meet his family in Los Angles. He took his wages from the trip and bought several hundred acres along the Salton Sea. But then Charlie’s wife fell ill in Los Angles and it was almost a year before he could get back to his job in Ohio.
But things had changed. While he had been away Wilbur had died of typhoid fever, in May of 1912. Orville made sure Charlie had a job, but, according to Charlie, “I found it wasn’t like old times….the pioneering days seemed over for me.” Finally, in 1919, Charlie left the Wright Company and returned to California. He opened his own machine shop on his property on the Salton Sea. “I waited for something to happen there,” Charlie said later, “and nothing did.” Except that his wife died and the depression of the 1930's drove him out of business, and he lost his land.
Charlie moved to Los Angeles and found a job working for North American Aviation for 37 cents an hour. He told no one about his past. He was just another production line mechanic. None of his fellow workers knew that he had helped to invent the entire industry. And that was where Henry Ford found him.
Ford was rebuilding the Wright Brothers workshop in Dayton as a memorial, and had hired detectives to track Charlie down. Ford brought Charlie back to reconstruct the wind tunnel and put the original 1903 Flyer back together. In 1941, his work for Ford finished, Charlie quietly went back to California and returned to work in a Defense plant. Then in 1945, Charlie suffered a heart attack. He was never able to work again. When Orville Wright died in 1948 he left Charlie an annuity in his will of $800 a year. By 1955 inflation had reduced that to a pittance, and when a newspaper reporter found Charlie, he was surviving in the charity ward of a Los Angles hospital. Immediately the aviation community raised funds, and Charlie was able to spend his last months in a private hospital.
He died at the age of 88 in 1956. He is buried in the Folded Wings Mausoleum, in Valhalla Memorial Park (above), directly under the approach to Burbank Airport runway 15-33.
Charlie Taylor lived for 48 years after he gave up his seat to a young Army Lieutenant. And he never did learn to fly. And that too was typical for Charlie Taylor, the unsung hero of powered flight.
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Friday, December 30, 2011

HUNTING THE BIG UMBER BIRD

I have to tell you a very dull story. It relates no shootouts, no hangings, no burnings at the stake. This story would make a really bad comic book, er, sorry, graphic novel. Heck, it would make an uninspiring regular novel. And as a television series it is just a non-starter. So it must not be important, huh. And because it lacks all of those dramatic threds to string you, the reader, along, it will never make it on the news networks - which are in fact rarely new. But it really is an important story. And if I try and gin it up a little bit, you may agree. The facts, I assure you, are all accurate.
The central character is a guy named Charles Pollock. He lived in Boston in the 1890’s, a dull town in a dull time. And Charles worked in a bank; dull, dull, dull. But at least he was narcissistic. That made him a little interesting, if only to himself. Then, in 1894, dull dull Charles took a lawsuit all the way to the Supreme Court. It was that case which made Charles the hero of the modern anti-tax movement. And here let me suggest you imagine a really big explosion, a sucide bombing maybe, with piles of innocent people dead and dismembered laying all over the place, because, really, the anti-tax movement is just a looney tunes version of suicide bombing- you blow up yourself and everybody around you.
I don't like paying taxes. I never have, I never will. There are some things my taxes have helped pay for that I don't approve of; a couple of wars, subsidies to a few domestic monopolies and some foriegn dictators, to name just a few. But those pale in comparison to the sin of not having a state to protect me and you. And, call them libertarians or anarchists, those who oppose the power of the state to tax its citizens resemble, to borrow a description from Tom Wolf, “…the logician who flies higher and higher in ever-decreasing circles until, with one last, utterly inevitable induction, he disappears up his own fundamental aperture and emerges in the fourth dimension as a needle-thin umber bird.” (“From Bauhaus to Our House”) To whit:
The U.S. government has been taxing income since 1861, as permitted in the Constitution under Article 1, Section 2 ("Representatives and direct Taxes shall be apportioned among the several states…") and Article 1, Section 8 ("The Congress shall have Power To lay and collect Taxes,…"). But in 1862 Supreme Court Chief Justice Roger Taney, the author of the Dredd Scott decision which had helped to bring on the Civil War, became incensed that money was actually being taken out of his paycheck to help pay for the Civil War. Taney was a very strong believer in slavery and in being treated as somebody special.
And Taney’s objections to paying taxes for the Civil War also struck a cord with those who might not like slavery but who thought they were also special and did not deserve to be paying taxes. We're talking about rich people here, very rich people, who had no compunction about buying politicians to get what they wanted. Buying politicians is what is currently known as free speech, if your logic can somehow equate "buying" with "free" in the same thought without your head disappearing up his own fundamental aperture.
Anyway, in 1872 the rich people had the income tax laws repealed. Unfortunatly for Taney he was already dead and he wasn't getting his money back. Or his slaves. For that he would have to wait until the "Inheritance Tax" could be redefined as the "Death Tax". But I digress...
For the next twenty years the Federal government struggled along supported by import duties alone, which amounted to less than 2% of the nation’s gross domestic product.  And yes, that is how we funded government before 1861. But before 1861 we were primarily an agricultural economy, where farm workers do not require much education, where populations were scattered and where all health problems were local, bcause transportation was by foot and horse. After 1861 we were a growing industrial economy. Factory workers required a high school education (or better). They were concentrated in population centers, and railroads were making  public health a regional problem. In other words, economic conditions had changed.
Now, besides being unable to support an effective government, import duties (taxes on imports), raised the price of all consumer goods, imported and domestic. In fact, during the 1880's import duties added as much as 48% to the final price consumers paid, for milk, for steel, and for everything in between. This protected domestic companies and allowed them to keep their prices high enough to ensure high profits. Are your eyes glazing over, yet? Picture this; you walk into your local 'speak easy ' and discover that overnight the price of a beer has gone up 50%. You ask the owner what gives. He tells you that he has new suppliers, and the cost of beer from them is 50% higher than it was from the old suppliers. You ask why he switched suppliers, and he explains, "They made me an offer I couldn't refuse."
Congressman William Jennings Bryant of Nebraska labeled high tariffs “socialism for the rich”. “They weep more because fifteen millions are to be collected from the rich than they do at the collection of three hundred millions upon the goods which the poor consume.” But it ain't like they did it in secret.
Between 1871 and 1891 sixty separate bills were introduced in congress to reestablish an income tax. That's right, people were actually fighting for the right to pay taxes. The Republicans, the party in power at the time, beat all of those efforts back. And then in 1893 a new tariff reform bill was introduced by Democratic Rep. William Wilson of West Virginia. Wilson's bill was primmarily intended to lower the import duties on foreign iron ore, coal, lumber, wool and sugar. But the bill also included a minor amendment, introduced by Rep. Benton McMillan from Tennessee, which read, “That from and after the 1st day of January, 1895, there shall be levied, collected, and paid annually upon the gains, profits, and income of every person residing in the United States, derived from any kind of property, rents, interest, dividends, or salaries…a tax of 2 per cent on the amount so derived over and above $4,000” during any five year period (equal to $88,400 today).
The pundits paid little attention to Mr. McMillan’s amendment because so many income tax measures had been introduced so many times before, and none of them ever came to anything. This was because the rich and powerful had a secret weapon, sort of a human tommy gun, a Homo sapian Chicago typewriter, if you will.
His name was Senator Arthur Gorman of Maryland, and he was a tool of the rich and powerful. Gorman helped the opponents of the Wilson bill attach more than 600 amendments which reinstated almost all of the import duties the bill had attempted to lower. It was a St. Vaentine's Day Massacre on the floor of United States Capital building, right in front of God and everybody, as my father used to say.
With the “Tariff reduction” bill thus bullet ridden and bleeding on the floor, no one believed that President Grover Cleveland, who had campaigned on a lower tariff platform, would ever sign the misbegotten bill into law. And he didn’t. He simply let the bill become law without his signature. It didn't cost him anything. At least the tariffs had been marginally lowered. At least he could claim that he had done everything he could to lower prices for working class Americans, while not having to actually do anything to openly offend his rich campaign donors.
But imagine the mobster's shock the next morning to discover that Al Capone had beat the rap for murdering the Bugs Moran's gang, but he was going to jail anyway for income tax evasion. That was the shock felt amongst the rich and powerful. America had returned to a national income tax. And the response was just what you would expect it would be from the rich and powerful. They sued.
The fine print of the accidental income tax law required that all stock companies pay the income tax for individuals before distributing any dividends to them. Dividends were income. And when he received his notice from the Farmers' Loan and Trust Company (because he owned all of ten shares of stock in Farmers’ Loan and Trust) Mr. Charles Pollock was very angry. He was angry enough to hire high priced Wall Street top gun lawyer named Joseph Choate, who filed a lawsuit against the bank claiming the income tax was unconstitutional.
The Massachusetts courts disagreed, as did the Federal courts. They both upheld the law. But somehow Charles Pollock found the money to appeal his lawsuit all the way to the United States Supreme Court, which, to everyone’s surprise, agreed to hear the case immediately.
On April 8, 1895 the court ruled 5-4, in favor of Mr. Pollock. That slim majority was saying in essence that the source of income mattered; salary could be taxed, but income derived from property – rent, interest on savings or dividends paid on stock - were not “apportioned” by population, and thus the government was denied the power to tax it.
The dissenting opinions were intellecutally devstating. Justice Brown wrote that “This decision involves nothing less than the surrender of the taxing power to the moneyed class…Even the specter of socialism is conjured up to frighten Congress from laying taxes upon the people in proportion to their ability to pay them.”
And Justice Harlan argued that the court's majority opinion, “…declares that our government has been so framed that,...those who have incomes derived from...bonds, stocks and investments...have privileges that cannot be accorded to those having incomes derived from the labor of their hands, or the exercise of their skill, or the use of their brains.” These were both powerful arguements. But then the greedy have always been willing to lose the intellectual arguements, as long as they get to keep their money.
Middle class Americans however were outraged. They were infuriated. They were fighting mad. And it would still take 11 years before the will of the people could overcome the power of the “moneyed classes”.
In 1909 President Howard Taft proposed a Constitutional Amendment (in part because he thought it would never pass) to allow a Federal Income Tax. On July 12, 1909 the 16th amendment passed the Congress and was submitted to the states, in part bcause the congress never thought the states would pass it. The amendment was brutally blunt and short. It reads in total, “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.” Period. End of Amendment.
Alabama took less than a month to vote for the 16th amendment. Kentucky, South Carolina, Illinois, Mississippi, Oklahoma, Maryland, Georgia and Texas all passed it in 1910. Twenty-three more states followed in 1911, three more in 1912, and six more in 1913.
It was with the vote of the New Mexico legislature, on February 3, 1913, that made the 16th amendment the law of the land. Six states either rejected the amendment or never took it up, but that did not matter. The Constitution only requires that two-thirds of the states approve of an amendment to make it the law.
And so, when some lunatic or confidence man or woman tries to seduce you with a magical scheme to avoid paying taxes, you can now explain to them that, by placing the source of support for the government in the people’s hands, income taxes places the power there as well.
The relevancy of this tale of narcissism to your life may become clearer when you realize that on June 1, 1929 the Farmers Loan and Trust Company named in the lawsuit changed their name to City Bank Famers Trust. And then in 1976 they changed their name again. This time they shortened it to Citibank.
This is the same Citibank that in 2009 swallowed some $320 billion of taxpayer (meaning your) bailout dollars. Oh, as of 1894, Charles Pollock was an employee of Farmers Loan and Trust in their Boston branch. And it seems likely to me that he sued his own employer with their connivance. Looking at history it seems to me that the limits to which the rich will go to avoid paying their fair share of government remains endless. These people just think they are top of the world, ma!
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