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announcing his defection from the Republican party, Vermont Sen.
James Jeffords invoked the names of previous
Vermont politicians, including that of former President Calvin Coolidge,
to justify his change to independent status.
Jeffords, who fought against President Bush's tax cuts, has less
in common with his fellow Vermonter Coolidge than he does with another
Republican senator who bucked his party and president to oppose
tax cuts. That senator was Michigan's James Couzens, who held office
from 1922-1936.
The similarities between Jeffords and Couzens are striking. Couzens
was a maverick Republican who fought the tax-cutting, fiscally prudent
policies of Republican presidents Warren Harding and Calvin Coolidge.
Like Jeffords, he was more often allied with "progressives" who
pushed for greater government spending and involvement in the economy.
Though wealthy himself, Couzens often employed class-warfare rhetoric
as an advocate of "soak-the-rich" tax policies, and his principal
nemesis was Treasury Secretary Andrew Mellon.
When Mellon came to Washington in 1921, the top federal income-tax
bracket was 73 percent. Confiscatory levies were putting scarce
capital to flight as investors sought refuge abroad or in tax havens
at home. Arguing that taxes had to be lowered "to attract the large
fortunes back into productive enterprise," Mellon noted that "more
revenue may often be obtained by lower rates" — a notion most
recently confirmed again with the 1997 cut in the capital-gains
tax rate.
With the full support of President Coolidge, who had assumed office
upon Harding's death in 1923, Mellon pressured Congress and by 1929,
when legislators passed his sixth tax cut of the decade, the top
rate had been slashed from 73 to 24 percent. Those in the lowest
income bracket (earning under $4,000 annually) saw their rates fall
by an even greater percentage — from 4 percent to one-half
of one percent.
Where was James Couzens in the debates over the Coolidge-Mellon
tax cuts? Like Jeffords, squarely on the wrong side, opposing them
at every turn and painting dire pictures of a hemorrhaging treasury.
But personal income tax receipts for 1929 were over $1 billion,
in contrast to the $719 million raised in 1921, when tax rates were
far higher. The economy grew by 59 percent in that period, America
was awash in new inventions, and American wages became the envy
of the world.
Simultaneously, with no help from Couzens, Coolidge and Mellon were
constraining the spending side of government. In 1928, total expenditures
were actually a shade lower than they had been in 1923. It's safe
to say that Jeffords's support for more federal spending —
notably in education--has not been of great help to those who would
hold the budgetary line today.
Ultimately, Couzens's opposition to his party's fiscal agenda also
brought an end to his career as a Republican. He was denied renomination
in 1936, and died in October of that same year.
Though Jeffords grudgingly mustered the good sense to vote for the
$1.35-trillion tax cut compromise that passed the Senate, his unrelenting
efforts to water down President Bush's already modest relief package
hardly qualify him as a great friend of the taxpayer.
If being "independent" means being unable to support anything but
the most meager of tax cuts in an era of federal surpluses, then
Jeffords is right to go his own way. Meanwhile, we can only hope
that more of the senator's colleagues will depend upon sound fiscal
policy and press for larger tax cuts to revive a flagging economy
and relieve the overburdened American people.
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