To sell his tax-code tweaks, new regulatory schemes, and insatiable ardor for big government, President Obama invoked Abraham Lincoln in his State of the Union address: “I’m a Democrat. But I believe what Republican Abraham Lincoln believed: That government should do for people only what they cannot do better by themselves, and no more.”
Was Lincoln the father of big government? In a new Special Report, Allen C. Guelzo, Ph.D., of Gettysburg College lays out the argument that the modern state’s paternity lies with the Progressives.
If big government means a permanently large and growing federal budget and a vast civil service, then Lincoln may deny paternity for both. While the federal budget indeed ballooned to meet the cost of the Civil War (from $63.2 million in 1860 to $1.29 billion in 1865), it shrank once the war ended (back to $293 million by 1870). “If Lincoln had plans to create ‘big government,’” Guelzo notes, “none of his successors seems to have known what they were.” Similarly, while the federal government employed more people during the war, the number shrank once the war ended.
If big government means a plethora of agencies possessing intrusive powers, then Lincoln is again vindicated. Lincoln’s Administration produced no dramatic increase in executive agencies. Between the 1850s and the end of the Civil War, the federal government added seven new agencies for a total of 22 (a far cry from the 513 agencies in 2010).
The policies that leave Lincoln’s Administration most vulnerable to the charge of expanding the reach of big government were tariffs and the imposition of a graduated income tax. But upon close examination, it is clear that they were no Trojan horse to grow government.
Government did not prosper under Lincoln’s tariff regime; instead, the American private sector did. Tariff rates tripled between the years of 1860 to 1864. Rather than pay more for imported products, however, Americans relied on domestic markets. This was a trade-off the Lincoln Administration was willing to accept: a loss of revenue from customs duties for the benefit it bestowed on domestic manufacturing, especially at a time when dependence on imports from foreign nations that favored the Confederacy imperiled the republic’s survival.
The income tax was levied to pay the bills—not to implement some broad social vision or redistribute income. By 1862, the costs of the Civil War were so high that Treasury Secretary Salmon Chase confessed to Lincoln that the Treasury was running dry on revenue, and financiers were proving reluctant to lend. The purpose of the income tax was twofold: to fund the war and the operations of government and to take the inflationary steam out of the newly introduced “greenback” currency.
The personal income taxes were modest burdens on Northern taxpayers: 3 percent on incomes below $10,000 and 5 percent on incomes more than $10,000. (There were steep progressive rates on those living under the Confederate government.) The personal income tax form amounted to exactly one page. These taxes lasted only until their repeal in 1872, and by that time all but the tariffs had disappeared.
Lastly, Lincoln was deeply committed to the framework of limited government set forth in the Declaration of Independence and the Constitution. He admitted that he “never had a feeling politically that did not spring from the sentiments embodied in the Declaration of Independence.” For Lincoln, the Constitution was never a living document capable of accommodating any policy he wished to implement. Even the canard that Lincoln shredded the Constitution’s protection for civil liberties has been thoroughly debunked. The true legacy of Lincoln is not enlarging government but preserving the Constitution and the Union.
Neither Lincoln nor his Administration was any model for today’s modern bureaucratic state. The wartime emergency of 1861–1865 increased the size and scope of the federal government for a time. This increase was the creature of an emergency and was never seen by Lincoln as anything but that. His unwavering commitment to natural rights and the Constitution’s framework of limited government dispels any notions that he set the stage for the expansion of government in the 20th century.