The Great Debate

February 1913 marked a turning point in U.S. history. One hundred years ago this month, the states ratified the 16th Amendment, clearing the way for adoption of a federal income tax. Two decades before, in 1892, the Populist Party had first put a progressive income tax on the national agenda.

The income tax faced steep conservative opposition. Since it was enacted, in fact, the political wars over income tax have never stopped. Conservatives battled against it when it was first proposed and have continued the struggle ever since. Now, Tea Party conservativism has given that fight new force.

The economist Joseph Schumpeter called tax systems the “thunder of world history.” Because if you dig beneath the rhetoric, tax systems reveal the underlying direction in which societies move. The saga of the income tax says a great deal about changes in America.

In the decades before the income tax, the rich grew extremely rich while most Americans struggled on the edge of poverty. Mark Twain dubbed it the Gilded Age: Plutocrats built ever-bigger mansions; hard times pressed on everyone else. Yet by the 1950s, the income tax had played a crucial role in the mix of policies that narrowed the income gap and built a broad middle class.

Over the past 35 years, however, those policies have been under siege.

Corporations have bent the regulatory regime to their will. Legal barriers have helped efforts to dismantle the trade unions. And conservative assaults have pounded the progressive structure of the income tax. As a result, the United States is experiencing a crisis of inequality not seen since the last Gilded Age.

Here’s what’s supposed to be happening:  After losing two presidential elections, Republicans are supposed to be re-evaluating what their party stands for.  Are they out of line with mainstream America?  Does the party need to change?

The answer is yes.  So the party moves to the center and searches for candidates with broader appeal.  Republicans don’t need another spectacle like the 2012 primaries, where the contenders ran the gamut from a panderer to the right (Mitt Romney) to the far right (former House Speaker Newt Gingrich, Rick Santorum) to the extreme right (Representative Michele Bachmann, Texas Governor Rick Perry) to the lunatic fringe (Herman Cain, Representative Ron Paul).

There was one moderate in 2012 — Jon Huntsman.  Huntsman didn’t make it past New Hampshire, where he came in first among the tiny number of Democrats who voted in the Republican primary.

George McGovern’s death Sunday marked the departure of a remarkably influential figure in American national politics. Though remembered largely for his landslide defeat to Richard M. Nixon in the 1972 presidential race, McGovern succeeded in reshaping the U.S. political landscape for the next 40 years.

His losing campaign forged the modern political party. Just as Barry M. Goldwater’s crushing defeat in 1964 mobilized a generation of conservative activists and transformed the GOP, McGovern’s insurgency led to the modern Democratic Party of Bill Clinton and Barack Obama. For the South Dakotan senator bequeathed to his party a reconstituted style of politics, a cadre of activists and an new path to electoral victory.

McGovern’s star-crossed campaign opened up the entire U.S. political process—he appointed, for example, the first national party chairwoman. More important though, he created a template for challenging the party establishment, one emulated frequently over the next 40 years — by the Republican right as well as the Democratic left.

Every marriage goes through its bumpy patches. Just ask British Conservative Prime Minister David Cameron and his Liberal Democratic coalition partner, Nick Clegg. They have just gone through the most serious spat since they cobbled together their civil union two years ago, when British voters removed Gordon Brown’s Labour government but didn’t give the Tories a clear mandate. The coalition is a marriage of convenience, a dynastic coupling where neither side is under any illusion that love or affection is involved.

The pretext for the current very public disagreement was a Labour motion in the House of Commons demanding an investigation into whether the minister responsible for deciding whether Rupert Murdoch could buy the 58 percent of broadcaster Sky he does not already own broke the government’s own strict code of conduct. Jeremy Hunt, the man at the center of the fight, has been shown to have made up his mind in favor before being given the job of impartially adjudicating and to have been ultra-cozy with the Murdochs, sending Rupert’s son James a high-five text suggesting that the deal was a fait-accompli. The Murdochs admit bombarding Hunt with no fewer than 788 exculpatory emails. Despite this, Cameron saw no problem with Hunt’s lack of objectivity, and Hunt has defied endless Labour calls to resign.

Clegg, who before the coalition was not deemed important enough to warrant even a Christmas card from Murdoch, spotted an opportunity. With the British public furious at how Murdoch has made a mockery of democracy by bullying and buying his way to business success, he declined to support the Labour motion. The Lib lawmakers were told not to back Cameron and Hunt. The Tories won the Commons vote anyway, as they have a few more lawmakers than Labour.

This essay is adapted from Pity the Billionaire: The Hard-Times Swindle and the Unlikely Comeback of the Right, published this month by Metropolitan Books. The views expressed are the author’s own.

After the disasters of the George W. Bush presidency had culminated in the catastrophe on Wall Street, the leading lights of the Beltway consensus had deemed that the nation was traveling in a new direction. They had seen this movie before, and they knew how it was supposed to go. The plates were shifting. Conservatism’s decades-long reign was at an end. An era of liberal ascendancy was at hand. This was the unambiguous mandate of history, as unmistakable as the gigantic crowds that gathered to hear Barack Obama speak as he traveled the campaign trail. You could no more defy this plotline than you could write checks on an empty bank account.

And so The Strange Death of Republican America, by the veteran journalist Sidney Blumenthal, appeared in April of 2008—even before the Wall Street crash—and announced that the “radical conservative” George W. Bush had made the GOP “into a minority party.” In November, Sean Wilentz, the erstwhile historian of the “Age of Reagan,” took to the pages of U.S. News & World Report to herald that age’s “collapse.” The conservative intellectual Francis Fukuyama had said pretty much the same thing in Newsweek the month before. That chronicler of the DC consensus, Politico, got specific and noted the demise of the word “deregulator,” a proud Reagan-era term that had been mortally wounded by the collapse of (much-deregulated) Wall Street.

-- Mark Kobayashi-Hillary is the author of several books, including ‘Who Moved my Job?’ and ‘Global Services: Moving to a Level Playing Field’. The opinions expressed are his own --

After thirteen years, it’s all over. The New Labour project is dead. Or is it? Tony Blair brought British politics to the centre-ground and ensured that a single party could support free-market economic policies as well as social justice.

And that’s what most people want today, a government that can help the citizen without hindering the economy through the dogma of dated ideology. The old notion of socialists waging war on small-government-right-wingers feels somehow quaint. Clearly Tony Blair knew that David Cameron would be his successor in the New Labour project, but nobody told Gordon Brown.

Michael Goldfarb serves as a GlobalPost correspondent in the United Kingdom, where this article first appeared.

The press was summoned early one recent morning to Chatham House, Britain’s leading foreign affairs think tank, to hear the thoughts of Conservative leader David Cameron on Britain’s national security. As Cameron is likely to become prime minister later this spring, attendance was high.

Anyone in the audience who, like me, thought they would hear a talk about his grand strategy for how to deal with threats to Britain’s national security in these extremely insecure times was disappointed. Cameron, bright and confident, spent most of his brief remarks outlining how he intended to change the internal decision making of government on national security issues rather than outlining a new approach to Iran or China.

– Paul Taylor is a Reuters columnist. The opinions expressed are his own –

Higher taxes? Lower public spending? Devaluation? Inflation? Investment in green growth?

European governments are pointing in very different directions as they debate an exit strategy from the global financial crisis. Despite European Union efforts to coordinate economic policy, there are clear signs that the main European economies will charge off in disarray towards separate exits.