One of the most striking features of the history of U.S. tax policy is the shifting attitude of Republican elites toward wartime taxes. For more than a century -- from the founding of the Republican Party through the war in Vietnam -- Republican leaders consistently supported high wartime taxes. Indeed, support for higher wartime taxes was a defining feature of being a military hawk among the GOP faithful.
Examples abound of GOP support for higher wartime taxes. Abraham Lincoln, the nation's first Republican president, was of course also the first president to sign into law a federal income tax, which took effect in 1862. Not surprisingly, GOP support was also strong for the tax increases enacted during World War I and World War II. For example, Kansas Republican Edward Little , a veteran of the Spanish-American War, took the House floor in 1917 to remind his colleagues that "when you conscripted the youth of this country" you promised "that you would conscript the wealth as well." "Let their dollars die for their country too," Little exclaimed.
In the months following the North Korean invasion of South Korea in 1950, Richard Nixon, campaigning for a seat in the U.S. Senate, signaled his hawkish anti-communist credentials by advocating new and higher taxes. On the stump in California, Nixon called for "an excess-profits tax as well as an increase in the taxes on individuals and corporations." "In wartime," Nixon opined, "there is no excuse or justification for allowing any individual or corporation to increase their profits as a result of war while men are dying on the battlefield."
During the war in Vietnam, the strongest support for Lyndon Johnson's surtax to help pay for the war came from Republican quarters. As one GOP Senator put it in January 1967, "I just don't see how we can be hawks on the war and then vote against taxes to pay for it." When Congress finally took up Johnson's surtax in 1968, Democrats were split but Republicans were nearly unanimous in their support for the wartime tax hike.
This history helps to put John McCain's reversal on the Bush tax cuts into perspective. From 2001 onward, McCain was staunch opponent of the Bush tax cuts, especially the Jobs and Growth Tax Relief and Reconciliation Act of 2003, which was enacted two months into the U.S. war in Iraq. The thrust of McCain's position was that it was simply wrong to cut taxes while the country was at war. Speaking in May 2004, the Vietnam veteran and former prisoner of war delivered a passionate declamation on the principles of shared sacrifice:
"My friends, we are at war. Throughout our history, wartime has been a time of sacrifice. At the beginning of the war I said it would be long and difficult, and would require a great deal of sacrifice on everyone's part. But about the only sacrifice taking place is that by the brave men and women fighting to defend and protect the liberties we hold so dear, and that of their families. It is time for others to step up and start sacrificing. What have we sacrificed? Just in the last year we have approved legislation containing billions and billions of dollars in unrequested and unauthorized pork barrel projects, huge tax breaks for the wealthy and, just last week, a corporate tax bill estimated to cost $180 billion, chock full of billions of dollars in tax breaks for wealthy oil and gas companies and other special interests. … That is far and away from sacrifice."
Today, of course, McCain has abandoned this sort of rhetoric in favor of wholehearted support of the Bush tax cuts. McCain's reversal illustrates the enduring political influence of Ronald Reagan (the country's most popular tax-cutting military hawk), as well as that of George W. Bush (the country's least popular tax-cutting military hawk). It is also part of a broader story of the decline of liberal Republicans.
But the question remains: is there any life left in the traditional GOP insistence on higher taxes during times of war? Interestingly, 32 House Republicans voted recently for an expanded G.I. bill that included a new surtax on high-income households, suggesting that, perhaps, the jury is still out.