Progressives: "Happy Birthday Abe!"

Chuck Sheketoff

Today is the birthday of America’s 16th president, Abraham Lincoln. Progressives should celebrate, because Lincoln, the GOP’s first president, signed America’s first income tax.

In 1861 the United States was going to war against itself. To preserve the Union the government in Washington, D.C. had to raise an army and the funds to sustain that army. The war created a financial crisis, and the solution was the imposition of the country’s first progressive income tax.

The Internal Revenue Act of 1862, signed by President “Honest Abe” Lincoln on July 1, 1862, set income tax rates at three percent on incomes above $600 and five percent on income above $10,000. Incomes below $600 were not taxed. At the time the tax was highly progressive because those who could least afford to pay did not; the tax burden fell on those with the greatest ability to pay.

At a time of financial crisis, Abe Lincoln and Americans stepped forward to support their government. Lincoln used the income tax to unite the nation.

On this anniversary of Lincoln's birthday, the Oregon GOP should reflect on what Lincoln was trying to preserve -- the United States of America -- and on the important role that Lincoln’s progressive income tax played in preserving the United States.

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    Adjusting for inflation, all the way back to 1862, that's no taxes for anyone under $10,714; a 3% rate for anyone over that and under $178,571; and a 5% rate for anyone making over $178 grand.

    (Those inflation factors come from research by Robert Sahr at Oregon State.)

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    The Lincoln income tax was soon declared unconstitutional. Where was the ACLU? 8c)

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    The federal income tax, with all its loophole-blemishes, has become even more progressive.

  • Rob Kremer (unverified)

    I move we dump the current federal tax code, with all its special interest loopholes, and simply adopt Honest Abe's rate structure! (With Kari's inflation adjustments, of course.)

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    It is not too surprising that Rob Kremer would increase the taxes on the poor while lowering them on the wealthy.

    What would be surprising would be if he (and other self-proclaimed Oregon libertarians like Cox, Charles and Buckstein) would walk their talk and show up in Salem and publicly denounce the inappropriate tax expenditures. Anybody ever seen Kremer in the revenue committees opposing tax expenditures?

  • Rob Kremer (unverified)

    Chuck: Maybe you can enlighten me. What is a "Tax Expenditure?"

    Is it different than government spending?

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    Haven't you ever read the biennial Tax Expenditure Report that the Governor must submit with his/her recommended budget? There's federal reports on federal tax expenditures, too. Its government spending through the tax code. Some good. Some bad. Anyone concerned with accountability over government spending ought to be concerned with tax expenditures.

    Here's the official definition in Oregon law:

    ORS 291.201 “Tax expenditure” defined. As used in ORS 291.201 to 291.222, “tax expenditure” means any law of the federal government or this state that exempts, in whole or in part, certain persons, income, goods, services or property from the impact of established taxes, including but not limited to tax deductions, tax exclusions, tax subtractions, tax exemptions, tax deferrals, preferential tax rates and tax credits.

  • Rob Kremer (unverified)


    OK,I got the definition.

    In other words, the part of your income that the government, by its policies, lets you keep - that too is considered a government expenditure.

    I think I get it now. The logical conclusion to such a notion is of course that all the money we make belongs to the government. It lets us keep some, but that too is a kind of government expenditure.

    Thanks for clearing that up. I think I understand the philosophical underpinnings of that argument now.

    And that philosophy had a lot of very dramatic successes in the 20th century, didn't it?


  • PanchoPdx (unverified)

    Comrade Kremer,

    Your criticisms are not constructive.

    How can we expect to engineer the society that best suits the needs of mankind if pessimists like you continue to ridicule our efforts very step of the way?

    The good news is that your condition is likely curable and we consider you a perfect candidate for our re-education program.

    Next year we plan to transform several vacant public elementary schools into citizen training facilities (We'll need the PDC to help us buy them before McMenamins turns them all into hotel/brewpub/theaters).

    In the meantime, please reflect upon how your comments affect the greater good.

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