Income Tax and The Contrast Between the Republican Party's First President (Lincoln) and Last President (Trump)

Trump has suggested that he could get rid of income tax and simply replace it with tariffs. As Catherine Rampell of the Washington Post points out, 40% of Americans don't pay income tax (and some of them actually "pay" a negative income tax) but everyone would pay tariffs. (Tariffs are not charged to foreign producers. They are paid by any American who buys an import, from an avocado to a smart phone.)

I've argued before that Lincoln was the first Republican president and Trump will be the last. This policy proposal is just one of many reasons why.

Trump was born rich and thinks that government does too much for the poor. Lincoln was born poor and thought that the government could do so much more for the poor. Lincoln initiated the income tax and sweeping public investments; Trump may end both.

The Democrats dominated American politics from the time of Jefferson to Lincoln, from 1801 to 1861. One of their core beliefs was that government should not engage in any investments - not roads or canals or schools or research. Everything should depend on individual rather than government initiative. It is weirdly congruent with the philosophy of a lot of conservatives, libertarians and Republicans today. That is, the modern Republican Party is a lot like the old Democratic Party. The one presidential portrait Trump hung in the Oval Office was of Jackson - the Democratic president who vetoed the national bank that Lincoln did so much to resurrect.

Lincoln was a strong proponent of government investment to create more affluence and opportunity for ordinary Americans. He signed legislation that created Morrill Land-Grant Colleges - creating a list of state universities that includes Iowa State, Michigan State, Pennsylvania State, Texas A&M, University of California, Berkeley, University of Illinois at Urbana-Champaign, and University of Wisconsin-Madison - more than 100 universities.
Lincoln grew up poor - born in a one-room log cabin (not a one-bedroom but one-room) and had only one year of formal education. He strongly believed that government should invest to improve the lives of everyone - particularly children born in poverty.

What were the result of Lincoln's investments in the country? During the time of Lincoln's administration and the decades after, the US economy grew faster than any other economy in the world and faster than any economy had in the history of the world.

Lincoln's policies faced fierce opposition from Democrats who thought government had no role in making investments like transcontinental railroads or universities or regulating banks and financial markets. Democrats who thought that the federal government could get all the financing it needed from ... tariffs.

Lincoln's most significant act was freeing slaves but that was almost incidental to his broader vision of creating an industrial economy and opportunity. Lincoln thought that more could be done to create opportunity for everyone - particularly the poor and enslaved.

Unlike some of my liberal friends, I don't think billionaires are a sign that the economy is broken. I think its awesome. Unlike my conservative friends who support Trump, I don't look at current reality and say, "What the rich need are more tax cuts and what the poor need is less welfare." I think that's demonstrably absurd. (Rather than get rid of income tax I think we should begin wealth tax.) At least as much as in the time of Lincoln we can and should tax the rich to fund investments in the poor. But of course, no contemporary Republican would agree with Lincoln's economic policies today. It's not Lincoln's party anymore. It's Trump's. And he has actually resurrected the party of Andrew Jackson - and is putting the final knife into the party of Abraham Lincoln.