W&L Historian Offers Context for the Fiscal Cliff Debate
With the “fiscal cliff” looming closer and closer, a Washington and Lee University historian whose 2012 book examined the history of United States tax policy says it is difficult to find a comparable moment in the past that looks just like today’s crisis.
Molly Michelmore, associate professor of history at W&L, is the author of “Tax and Spend: The Welfare State, Tax Politics, and the Limits of American Liberalism (University of Pennsylvania Press, February 2012).
Her book traces the development of taxing and spending policy, which are areas not commonly examined together, from the New Deal of the 1930s through the Reagan revolution of the 1980s.
“Certainly taxes have been the point of contention in the past, but it’s hard to say that there is a similar moment insofar as this is a crisis of Congress’ own making,” said Michelmore. In the previous instances, the minority party has been willing to negotiate with the White House over tax policy. She pointed to the case of the so-called Reagan revolution when the Democrats ultimately worked with the president to shift the tax code in ways that that were more in line with voters’ desires.
“For the Republican Party, this crisis is extraordinarily difficult because to avoid it means they have to rethink the party’s identity for the last 30 years,” she said. “Nobody wants to be responsible for raising taxes, particularly on people who don’t make a lot of money. The Republican Party has become almost a cult of tax cuts. So switching their position now becomes very difficult and may be impossible for them.”
Michelmore said that if there is anything good to come out of this crisis it could be the prolonged discussion about taxes and tax reform, leading to “a growing recognition of the extent to which the tax code is used to fund various national priorities, from medical insurance coverage to home ownership.”