Published Thursday, January 03, 2013
Before this one, the last year that ended in “13” turned out to be one of the unluckiest in American history. Now comes word from astronomers that a recently-discovered comet is heading our way in 2013, predicted by some to blaze 10 times brighter than a full moon.
If you’re afflicted with triskaidekaphobia (fear of the number 13), or if you believe the old myth that a comet is a bad omen, you’re already looking forward to 2014. I’m not superstitious, but I earnestly hope 2013 doesn’t bring us anything as calamitous as 1913 did.
The year 1913 would rank as an unlucky year if all that had happened was Woodrow Wilson’s ascendancy to the presidency. He was a notorious racist and philanderer. He injected America into a war that he had promised to avoid, and then campaigned for a peace treaty that all but guaranteed the next one. Three things he helped give us that year, however, make it unforgettable in the most negative sense: The income tax, the direct election of U.S. senators and the Federal Reserve System.
On Feb. 3, a month before Wilson took office, the 16th Amendment to the Constitution was ratified. Strongly supported by Wilson, it authorized the federal government to impose a tax on personal incomes. Subsequent legislation set the top rate at a mere 7 percent. When Wilson left office eight years later, the top rate was more than 10 times higher.
The income tax granted politicians enormous power to reward friends, punish enemies and redistribute wealth. It morphed into a more oppressive, productivity-sapping nightmare than even its most ardent opponents had warned Wilson against. Today’s massive IRS bureaucracy and incomprehensible, 73,000-page federal Tax Code are Wilson’s illegitimate children, born in 1913.
On April 8, the 17th Amendment to the Constitution was ratified, also with Wilson’s longstanding endorsement. Instead of being appointed by state legislatures as established by the Founders, U.S. senators would thereafter be chosen by popular vote. It seriously eroded the balance between state and federal governments to the great detriment of the former. The explosion of unfunded federal mandates could never have occurred if U.S. senators were directly accountable to state legislatures.
On Dec. 23, Wilson’s signature enshrined into law the Federal Reserve Act, creating a central bank and more economic mischief than any other federal initiative or institution in the last 100 years.
Imagine if Congress had hired a private company to manage the nation’s money supply, protect the value and integrity of the currency, promote full employment and iron out the boom-bust cycle. Imagine further if that company went on to generate a Great Depression, a slew of recessions and volatile swings in employment and a dollar worth perhaps a nickel of its former value. We’d have long ago fired the company and jailed its executives. Yet that’s precisely the legacy of the Federal Reserve.
In American history, 1913 should go down as a date that will live in infamy. But it wasn’t the Japanese who bombed us that year. It was our own duly elected officials.
(Lawrence W. Reed, a resident of Newnan, is president of the Foundation for Economic Education in Irvington, N. Y., and Atlanta.)