Death tax came from socialist platform

Human Events, Apr 23, 2001 by Kaza, Greg

What Hath Eugene V Debs Wrought?

The current battle over repeal of the federal death tax overlooks its origins in the Socialist Party of America. Signed into law in 1916 by Democratic President Woodrow Wilson, the death tax appeared 12 years earlier in the 1904 Socialist platform, which pledged to:

"(W)atch and work, in both the economic and the political struggle . . . for the graduated taxation of incomes, inheritances, franchises and land values.. "

The Socialists succeeded in achieving these radical policy goals. "In our opinion," economists Milton and Rose Friedman wrote in their 1980 book, Free to Choose, "the Socialist Party was the most influential political party in the United States in the first decades of the 20th Century." The death tax had its origin in the Socialist Party.

Mathematics explains how radical Socialist tax proposals came to be incorporated into federal law. Historically, third parties have had little success winning federal elections. Only a few Socialists (Meyer Landon of New York and Victor Berger of Wisconsin) ever served in Congress. But the Socialists had their tax proposals co-opted by the Democrats after their mathematical balance-of-power increased dramatically in several federal election cycles.

Balance-of-power is the .difference in votes between the Democratic and Republican candidates. Successful third parties like the Socialists, and the 19th-Century Populists before them, used balance-of-power as political leverage to achieve their policy ends.

In 1900, perennial Socialist presidential candidate Eugene V. Debs polled a mere 87,814 votes nationally. Debs stood for the presidency five times, never polling more than a million votes or winning a single Electoral College vote.

Yet his advocacy of the death tax proved successful. In 1904, Debs' vote total leaped to 402,283, or 3% of the popular vote. He held balance-of-power in Maryland. Nationally, six Socialist congressional candidates held balance-of-power. Republicans won five of these races. Republican President Theodore Roosevelt was a keen observer of the Socialists throughout his political career. After the 1904 election, Roosevelt wrote statistician Charles Ferris Gettemy and termed the Socialist vote "significant."

In 1908, Debs made modest gains in the popular vote (420,380). His balance-ofpower increased to three states: Colorado, Oklahoma and Indiana. Republican William H. Taft won Indiana's 15 electoral votes and the White House that year. Socialist congressional candidates held balance-of-power in six seats. Republicans won all six. In 1910, the Socialists held balance-of-power in 39 House seats. Republicans won 17.

Socialist balance-of-power peaked in 1912. Debs polled 900,672 votes, 6% of the popular vote, and held balance-of-power in 12 states. Democrat Wilson lost 22 electoral votes in three states (Washington, California and Utah) where Debs held balance-ofpower. Socialist congressional candidates held balance-of-poWer in 59 seats, or 13.5% of all House races, the greatest percentage by a third party in the 20th Century. Republicans won 28.

Woodrow Wilson Tried To Co-Opt the Socialists

Wilson's speeches were peppered with references to the Socialists. "The trouble with socialism is not what'it desires," he told the American Bankers Association, "but the method by which it proposes to reach what it desires:" While serving as New Jersey governor, Wilson offered a glimpse of the co-optation strategy that he would pursue as President. "We are constantly struggling for programs big and little," he declared, "the biggest is the Socialist, and the smallest of all programs is that of the stand-patter."

By signing income tax legislation in 1913, Wilson hoped to co-opt the Socialists and prevent further Democratic losses in the House. That did not stop Debs, a one-term (1885-86) Democratic Indiana state House member. He minced no words when it came to free enterprise, declaring "capitalism and crime have become almost synonymous terms." Debs called Karl Marx "a profound economic philosopher, who will be known in the future as the great emancipator."

He wrote of private property: "To buttress and safeguard this exploiting system, private property of the capitalist has been made a fetish, a sacred thing, and thousands of laws have been erected and more thousands supplemented by court decisions to punish so-called crimes against the holy institution of private property." Income and inherited wealth were natural targets of resentment for the Debsian Socialist Party.

In 1914, Socialist congressional candidates held balance-of-power in 39 races. Republicans won 23 of these seats. Wilson again moved to co-opt the Socialists by signing the death tax passed by the Democratic Congress prior to the 1916 election. The Democrats still lost 18 of 31 House seats that year in races where Socialists held balance-of-power. Ironically, the Republicans regained Congress in 1918.

Further irony: Debs organized his last presidential campaign in 1920 from a prison cell. He was prosecuted by the Wilson Justice Department under the federal Espionage Act for opposing U.S. entry into World War I. Debs' sentence was commuted Christmas Day 1921 by President Warren G. Harding, a Republican. He died in 1926. Today, the time has come to abolish the Debsian death tax to its final resting place.