James Madison and John Calhoun were right to worry that the wrong fiscal regime would spell the demise of limited government. The enactment of the federal income tax eroded a traditional constraint on government spending and set the stage for the redistribution of wealth from taxpayers to tax consumers.

Jody W. Lipford is a professor of economics at Presbyterian College in Clinton, S.C.
Bruce Yandle is Alumni Distinguished Professor of Economics, Emeritus and Dean Emeritus, Clemson University and co-editor of Regulation and the Reagan Era.
Economic History and DevelopmentEconomic PolicyEconomyFederal Tax PolicyFiscal Policy/DebtGovernment and PoliticsGovernment Waste/PorkPublic ChoiceTaxesTaxes and Budget
Other Independent Review articles by Jody W. Lipford
Fall 2023 How Big Things Get Done: The Surprising Factors That Determine the Fate of Every Project, from Home Renovations to Space Exploration and Everything in Between
Summer 2021 A Fiscal Cliff: New Perspectives on the U.S. Federal Debt Crisis
Summer 2020 Is the Welfare State Crowding Out Government’s Basic Functions?: An Update
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Other Independent Review articles by Bruce Yandle
Fall 2022 Gaining Ground: Markets Helping Government
Summer 2020 The Next Fifty Years: Optimistic or Pessimistic?
Spring 2020 Narrative Economics: How Stories Go Viral and Drive Major Economic Events
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