Money  /  Q&A

Tax Regimes

Historian Robin Einhorn reflects on Americans’ complicated relationship to taxes, from the colonial period through the Civil War to the tax revolts of the 1980s.

NM: It is useful to think of fiscal history as a story of struggle over the demarcation of spheres for legitimate public debate. This is especially interesting in the American context, where propertyless citizens had the right to vote, and consequently we see the emergence of these protected decision-making spheres. We could frame the entire fiscal history of the United States in the nineteenth century around the efforts of those who own the property to shield themselves from public arenas where they would be forced to negotiate with the rest of the population over how to distribute burdens and rewards.

RE: The upper South states in the 1830s and 1840s are a perfect case of that. With the elimination of property qualifications for suffrage, a growing number of non-slaveholding yeomen in the western parts of North Carolina, northern Georgia, or eastern Tennessee, were enfranchised. They demanded more representation in the legislature. They want reapportionment, which slaveholders feared would lead to the abolition of slavery. The yeomen wanted roads and schools, the slaveholders worried they would tax slavery out of existence. This is the fear expressed by Hinton Helper in the Impending Crisis, a book which spread through the South in 1857. 

The deal became that reapportionment in the legislature could take place only if the non-slaveholders agreed that their land and livestock would be taxed at the same rate as slaves and land and livestock. They could try and get their roads and schools, but not by taxing slavery at a higher rate.

NM: You are describing an interesting dialectic between elites who were trying to protect themselves from redistribution, whether they were in Chicago or Maryland, and democratic constituencies who are bent on expanding government spending, building infrastructure, and providing education. What were the differences between this sort of legislative infrastructure in the North and South? 

RE: As early as the seventeenth century, Northern colonies had sophisticated regimes of property taxation. Local assessors, who assessed property values for the purposes of taxation, struck deals with local property owners to develop rules that were fair enough and served public purposes. Assessment has been described as both an art and a science—I think it’s a politics.

In the South, the laws did not make room for local politics. They did not assess the value of real estate before the American Revolution at all. Instead, they had flat rates per acre, which meant that high value property paid the same as low value property. They had flat rates per slave, sometimes in age and sex categories. These were rules set by the legislature, not local assessors. Why didn’t they do the assessment? My answer was that they couldn’t do local politics.