Commentary Magazine


Topic: William Howard Taft

Paying the Corporate Income Tax

Who actually pays the corporate income tax has long been a problem for economists. Depending on the particular competitive circumstances in an industry, the tax is paid through some combination of lower wages for workers, lower capital gains for investors, and higher prices for consumers. 

A new study from Ben Southwood of the Adam Smith Institute calculates that, on average, workers pay 57.6 percent of the corporate income tax. In other words, a tax that was instituted under President William Howard Taft in order to tax the rich, who owned almost all corporate stock in the early 20th century, now taxes mostly the average guy.

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Who actually pays the corporate income tax has long been a problem for economists. Depending on the particular competitive circumstances in an industry, the tax is paid through some combination of lower wages for workers, lower capital gains for investors, and higher prices for consumers. 

A new study from Ben Southwood of the Adam Smith Institute calculates that, on average, workers pay 57.6 percent of the corporate income tax. In other words, a tax that was instituted under President William Howard Taft in order to tax the rich, who owned almost all corporate stock in the early 20th century, now taxes mostly the average guy.

In 2013 the corporate income tax yielded $273 billion in revenue to the federal government, a little less than 10 percent of all federal revenues. Because it was never coordinated with the personal income tax that was instituted after the adoption of the 16th Amendment in 1913, it has been one of the main drivers of the ever greater complexity of the tax code as taxpayers have sought to legally avoid taxes by playing one tax off against the other.

While, heaven knows, the whole tax code needs to be junked and completely rethought, a good place to start would be by abolishing the corporate income tax.

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Good News for Christie: The Taft Precedent

Chris Christie faces some formidable obstacles in his path to the presidency. There are those who think his abrasive personality will ultimately do him in during the heat of a primary or general election campaign. Others point to the hostility with which many conservatives view him and say his post-hurricane embrace of President Obama will never be forgiven on the right. But others say that the real problem for Christie is his weight. Some speculate as to whether his health will allow him to survive the grueling task of running for president. And in an age in which body image seems to mean more to Americans than just about anything, it’s tough to imagine the country electing someone who can only be described as obese rather than just overweight.

Seen in that light, Christie’s fans may not have been pleased to see the New York Times focus attention today on the only real precedent for a Christie presidency: William Howard Taft. The paper ran a feature about research into the dieting methods of our 27th president. As the paper reports, Taft, whose weight fluctuated between 255-355 pounds during his career in national office, used modern dieting methods including a low-fat diet that had sporadic success. He also kept a food diary and counted calories in a manner that might seem familiar to contemporary Americans. But in the end, Taft stayed fat and was the butt of a lot jokes in his own time, not to mention stories about him getting stuck in his jumbo-size bathtub. But as much as Taft (who is remembered as much for his weight problem as for the achievements of a long and varied career in public service) is not exactly the person that Christie would want voters to think about when considering his potential presidential candidacy, there is another side to this story that actually works to his advantage.

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Chris Christie faces some formidable obstacles in his path to the presidency. There are those who think his abrasive personality will ultimately do him in during the heat of a primary or general election campaign. Others point to the hostility with which many conservatives view him and say his post-hurricane embrace of President Obama will never be forgiven on the right. But others say that the real problem for Christie is his weight. Some speculate as to whether his health will allow him to survive the grueling task of running for president. And in an age in which body image seems to mean more to Americans than just about anything, it’s tough to imagine the country electing someone who can only be described as obese rather than just overweight.

Seen in that light, Christie’s fans may not have been pleased to see the New York Times focus attention today on the only real precedent for a Christie presidency: William Howard Taft. The paper ran a feature about research into the dieting methods of our 27th president. As the paper reports, Taft, whose weight fluctuated between 255-355 pounds during his career in national office, used modern dieting methods including a low-fat diet that had sporadic success. He also kept a food diary and counted calories in a manner that might seem familiar to contemporary Americans. But in the end, Taft stayed fat and was the butt of a lot jokes in his own time, not to mention stories about him getting stuck in his jumbo-size bathtub. But as much as Taft (who is remembered as much for his weight problem as for the achievements of a long and varied career in public service) is not exactly the person that Christie would want voters to think about when considering his potential presidential candidacy, there is another side to this story that actually works to his advantage.

Though Americans tend to prefer handsome and fit presidents (a description that fits most but not all of those who both preceded and followed Taft into the White House), those who question whether Christie can take the stress of the trials of the presidency, need to remember that Taft actually lived to be 73, a ripe old age for someone who was born in 1857. If Big Bill could live a full and vigorous life until he died while serving as Chief Justice of the U.S. Supreme Court, there’s no reason why Christie, who has the advantage of the better medical care available to Americans a century later, can’t do just as well if not better.

As the Times points out, had he lived today, Taft would have had the option of weight-loss surgery (a procedure that Christie underwent earlier this year) which might have helped him. But aside from that, he would be in the same position of having to cope with the travails of diets and self-monitoring.

But as Taft’s life proves, the notion that obesity shortens life spans may be a statistical meme but it is not a certain death sentence. For all of his obsessing over his weight and the embarrassment over the attention it brought him, Taft lived a full life, playing golf and being involved in useful work that he cared about. His post-presidential career was especially satisfying since it led to his joining the Supreme Court, a post that had always been the summit of his ambition. The decision to run for president was something that had more to do with the wishes of his friend and predecessor Theodore Roosevelt (though once in the White House he broke with TR and lost his bid for re-election because Roosevelt ran as a third party candidate) than his own desires. He hated his time as president.

Christie clearly revels in the work of running a large, complex state like New Jersey (a post he is in no danger of losing this fall as his current lead over his Democratic opponent is at 24 percentage points in the latest poll) as well as in the political combat that comes with it and would likely thrive in the White House as well.

However, the real challenge would not so much lie in being president as in running for the job. Unlike 1908 when Taft could follow the practice of staying home and campaigning from his front porch while surrogates were detailed to do the dirty work of hitting the hustings and making the case for his election, Christie would be forced to engage in the two-year-long sprint that is the current method candidates must endure. But given the large number of Americans who face the same problem today (due to the availability of food and health care, far more Americans are obese today than they were in 1908 and 1912) he could count on a lot of sympathy for his weight struggles than might overcome any tendency to reject a fat president.

We can’t predict Christie’s future health any more than Taft’s doctors could say how long he would live more than a century ago. Nor can we be certain of the political forecast. But the odds are, if Christie is not going to win in 2016 it will not be due to his weight.

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RE: Why Isn’t He Better at Being President?

Jennifer asks a good question that is more and more on the minds of citizens and the punditocracy alike. Obama is so smart and so eloquent, and yet he has not, at least yet, succeeded as president domestically or in foreign affairs.

One answer, perhaps, is that being a successful president requires skills and attributes that Obama simply does not possess. Being “smart” is not among those attributes. Everyone who gets elected president is smart, for anyone who wasn’t could never make it through the world’s longest and most difficult political obstacle course. George Romney — no dummy by a long shot — came a cropper with a single ill-considered remark about having been brainwashed regarding Vietnam.

But being “supersmart” is not only no help; it is, I think, often a hindrance. Six future presidents were elected to Phi Beta Kappa as college undergraduates: John Quincy Adams, Chester Arthur, Theodore Roosevelt, William Howard Taft, George H.W. Bush, and Bill Clinton. Of those six, only Roosevelt could be considered a great president. Three of them, Adams, Taft, and Bush, were defeated for re-election, and Arthur couldn’t even get nominated for a second term. (His presidential reputation has been improving of late, however.)

And intellectuals, of course, are all too capable of thinking themselves into disaster. Remember George Orwell’s famous crack about “an idea so stupid only an intellectual could have conceived it.”

One might think that engineers, trained to deal with real-world forces, might make better presidents. But the only two engineers to reach the White House were Herbert Hoover and Jimmy Carter, both terrible presidents.

So what makes for successful presidencies? It might be fruitful to compare what the two greatest presidents of the 20th century, Franklin Roosevelt and Ronald Reagan, had in common. Neither were intellectuals (Roosevelt hardly ever read a book as an adult), but both were very “savvy,” not the same thing as smart. Both were master politicians, able to assemble and maintain coalitions. Both had immense charm. Both were first-class orators. Both had a great sense of humor and loved to tell jokes. Both were comfortable in their own skins and not given to introspection. Both had an abundance of self-confidence but no trace of arrogance. In both, the inner man was inaccessible, and no one felt he really knew what made either man tick. And both had that indispensable handmaiden of greatness — luck.

How many of those attributes does Barack Obama have?

Jennifer asks a good question that is more and more on the minds of citizens and the punditocracy alike. Obama is so smart and so eloquent, and yet he has not, at least yet, succeeded as president domestically or in foreign affairs.

One answer, perhaps, is that being a successful president requires skills and attributes that Obama simply does not possess. Being “smart” is not among those attributes. Everyone who gets elected president is smart, for anyone who wasn’t could never make it through the world’s longest and most difficult political obstacle course. George Romney — no dummy by a long shot — came a cropper with a single ill-considered remark about having been brainwashed regarding Vietnam.

But being “supersmart” is not only no help; it is, I think, often a hindrance. Six future presidents were elected to Phi Beta Kappa as college undergraduates: John Quincy Adams, Chester Arthur, Theodore Roosevelt, William Howard Taft, George H.W. Bush, and Bill Clinton. Of those six, only Roosevelt could be considered a great president. Three of them, Adams, Taft, and Bush, were defeated for re-election, and Arthur couldn’t even get nominated for a second term. (His presidential reputation has been improving of late, however.)

And intellectuals, of course, are all too capable of thinking themselves into disaster. Remember George Orwell’s famous crack about “an idea so stupid only an intellectual could have conceived it.”

One might think that engineers, trained to deal with real-world forces, might make better presidents. But the only two engineers to reach the White House were Herbert Hoover and Jimmy Carter, both terrible presidents.

So what makes for successful presidencies? It might be fruitful to compare what the two greatest presidents of the 20th century, Franklin Roosevelt and Ronald Reagan, had in common. Neither were intellectuals (Roosevelt hardly ever read a book as an adult), but both were very “savvy,” not the same thing as smart. Both were master politicians, able to assemble and maintain coalitions. Both had immense charm. Both were first-class orators. Both had a great sense of humor and loved to tell jokes. Both were comfortable in their own skins and not given to introspection. Both had an abundance of self-confidence but no trace of arrogance. In both, the inner man was inaccessible, and no one felt he really knew what made either man tick. And both had that indispensable handmaiden of greatness — luck.

How many of those attributes does Barack Obama have?

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