Ten years before the American Revolution, the British Parliament passed the Stamp Act of 1765, which was the first in a series of direct taxes over the American colonies. The colonists immediately recognized it as a violation of their fundamental rights as British citizens to tax themselves through their own legislatures. They had no representation in the British Parliament and even if they did, their representatives would be outnumbered and outvoted every time their interests conflicted with the Mother Country’s. The colonists protested the Stamp Act, which led to its repeal; however, the Parliament then passed other taxes and measures aimed at controlling the colonies including the infamous tea tax. The citizens of Massachusetts responded to this tax with their Party in Boston Harbor in 1773. The British King and Parliament then ordered the occupation of Boston and imposition of martial law, as well as the extraordinary act of disbanding the Massachusetts’ legislature, as they had done to New York’s a few years earlier.
After a decade of these abuses and usurpations of powers, enough of the American people had finally seen enough. Virginia legislator Patrick Henry best articulated this sentiment in his famous “Liberty or Death Speech” of 1775 calling for a break with the Great Britain. In his address to the Virginia legislature, he observed the common trait of human nature to put off making difficult choices, “to indulge in the illusions of hope” but after ten years the time for such self-deception had long since passed. He closed in a mighty crescendo, “I know not what course others may take; but as for me, give me liberty or give me death!” Virginia, and the other twelve colonies joined together in the fight for freedom and went on to prevail in the American Revolution.
There are several other examples of the ten-year learning curve in American history. It took ten years after the passage of the Articles of Confederation in 1777 to reach consensus that the federal government lacked the power to hold the nation together and replaced it with the Constitution in 1787.
Sixty years later, the decade of the 1850s marked the pivotal moment in the fight to end slavery starting with the Missouri Compromise in 1850 extending the institution west, followed by the rise of the Republican Party, founded in 1854 to oppose that expansion. Next came the Supreme Court’s Dred Scott decision in 1857 ruling in favor of the constitutionality of slavery, which fueled the growth and influence of the Republican Party all the more. The American people then elected that Party’s first President, Abraham Lincoln, in 1860. The Civil War followed leading ultimately to the demise of slavery once and for all.
The Great Depression era of the 1930s offers another example of the learning curve. Franklin Delano Roosevelt came to power in the early 1930s and ushered in the New Deal with its top down approach of the federal government taking over control of much of the economy in order to try generate growth and to create jobs. At the end of the decade, Roosevelt’s own Treasury Secretary, Henry Morgenthau, testified before a congressional committee, offering the poignant assessment that in terms of creating jobs, the New Deal had been a failure and had doubled the National Debt. The unemployment rate remained at a stubborn 15 percent in 1940. World War II intervened in the early 1940s with much of the New Deal rolled back (Social Security being one important exception) in the post War elections.
Big Government re-emerged in the mid 1960s with Lyndon Johnson’s Great Society. Programs like welfare, Medicaid, food stamps, and public housing came into being and reached their full expanse by the 1970s. After a majority of Americans realized the War on Poverty, based on the liberal central credo of tax and spend, was in fact creating more government dependency and perpetuating poverty, the Reagan Revolution and the Republican Revolution followed in the 1980s and 90s. These revolutions focused on growing the private sector and not the government and led to the greatest economic expansion in American history. Welfare reform also passed in the 1990s, which moved millions people from government dependency to self-dependency. Not surprisingly, the poverty rate shrank and the unemployment rate dropped to under 5 percent.
The re-election of Barack Obama earlier this month indicates the United States is in the midst of another decade long learning curve cycle. As at the Founding, taxation and the role of government are again the central issues. The federal deficit for the month of October was $120 billion, so the nation is on track to have its fifth straight year of trillion dollar plus deficits. Entitlement programs now account for over half of all federal government spending each year: a whopping $2 trillion. President Obama has lowered the requirements to qualify for food stamps, welfare and Medicaid (through the passage of Obamacare), and the costs of these programs are skyrocketing as millions enroll (a record 47 million on food stamps alone, up over 14 million since 2009) threatening the nation’s fiscal and overall economic health. Meanwhile, he has turned to the old liberal tax and spend mantra (saying that was a central issue in his re-election) while promising somehow raising taxes on those who create jobs will not negatively impact economic growth or job creation.
America is clearly still on the upside of the learning curve, but there is hope in Churchill’s observation, and in our history, that after we have once again tried everything else, we will do the right thing.