Thursday, September 24, 2009

Sheldon D. Pollack's "War, Revenue, and State Building"

Sheldon D. Pollack lives in Merion, Pennsylvania, on the Main Line suburbs of Philadelphia. He is professor of law and legal studies at the University of Delaware and is the author of The Failure of U.S. Tax Policy: Revenue and Politics (1996) and Refinancing America: Republican Antitax Policies (2003). In addition, Pollack has written numerous articles in scholarly and popular journals such as Tax Notes, Society, Polity, The New Republic, Legal Affairs, and The American Prospect.

The result of the “Page 99 Test” applied to his latest book, War, Revenue, and State Building: Financing the Development of the American State:
In the United States, where social welfare programs were introduced relatively late, the demand for revenue has mounted steadily since the 1960s. In recent decades, the rising cost of the social welfare programs of the American state has even outstripped spending for the military. At the same time, changing demographics has undermined the financial integrity of Social Security, the national income-maintenance program for the elderly. The financial position of the American state has been strained by the so-called entitlement programs (especially, Social Security and Medicare). Entitlement spending is outside the control of the normal congressional budget and appropriation process. Whether state officials can continue to raise enough revenue through taxes and borrowing to finance both the expensive military and social welfare programs of the United States remains to be seen. The continued development of the American state depends on it. p. 99.

Remarkably, page 99 of my book summarizes many of the themes of the book. Perhaps because this is the concluding paragraph of chapter 3. Overall, the book describes how the weak fiscal powers of the American national government of the late eighteenth century initially inhibited institutional development of the national government, while the creation of a powerful extraction system for extracting revenue facilitated the expansion of the federal government. This all happened in a relatively short time. The American state quickly developed from a weak, highly decentralized confederation composed of thirteen former English colonies into the foremost global superpower—stronger even than the monarchies of Europe that the founders feared and wished to avoid. This remarkable institutional transformation would not have been possible without the revenue raised by a particularly efficient system of public finance, first crafted during the Civil War and then resurrected and perfected in the early twentieth century—namely, the federal income tax. This revenue financed America's participation in two global wars as well as the building of a modern system of social welfare programs. The gloomy conclusion of the book is that the great expansion of the U.S. military as well as increased spending on domestic entitlement programs now threatens the continued viability of the American state as spending outstrips revenue.
Learn more about War, Revenue, and State Building at the Cornell University Press website.

Visit Sheldon D. Pollack's website.

--Marshal Zeringue