Who came up with the IRS? Was it George Washington? Alexander Hamilton? Thomas Jefferson? You will be surprised. Taxation without representation was actually one of the most important aspects that led to the 1776 War of Independence in the United States. And in France, taxes also are one of the causes that led to the French Revolution.
But the tax issues that ultimately led to wars was not just an 18th century concept. It continued into the 19th century during the Civil War. From the time of the beginning of World War I, national taxes began in a major way, but taxes did not exceed 15% – in the highest tax bracket. But after the War, taxes went way up.
FDR’s New Deal was the plan that saw the greatest jump in taxes. The top marginal tax rate actually hit 94%. Since then, it went down and up. But the point of this video is to show the connection between taxes and wars in the history of the United States. A critical point made here is that wars are often the spark plug for a steep raise in taxes. But, then instead of cutting taxes and going back to normalcy, often Congress continues to dig deeply into our pockets. And yes, outside of FDR and LBJ, the Democrat Presidents actually have a pretty good job as far as not raising taxes. Many Republicans actually have raised taxes too. The main exception who clearly lowered taxes is Ronald Reagan.
The thesis of this video is that we should cut military expenditures and invest more internally in order to not raise taxes. This sounds very reasonable. But it does ignore one very important point. World War II was as costly as it was BECAUSE of America’s isolationist attitude leading up to the War. So, higher taxes are not merely a result of the high cost of wars. Policies that lead to wars are also a leading cause of ultimately raising taxes. Had America not been as isolationist and intervened in the 30’s against German expansionism, hundreds of thousands of Americans would have been saved and millions of others would have survived too.
But Patrick Bet-David truly does inform and educate in this fascinating look back at the connection between taxes and wars since before the United States was formed until today.