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December 18, 2008
Taxation in Colonial America
Joseph J. Thorndike

Full Text Published by Tax AnalystsTM

Taxation in Colonial America by Alvin Rabushka (Princeton University Press, 2008), 968 pages, $60.00.


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Alvin Rabushka has written an extraordinary history of early American taxation. Weighing in at 3 pounds, 5 ounces, and running to almost 1,000 pages, it's a big book. But it needs to be, for this is historical work on a grand scale. Rabushka has managed to compress into a single volume a detailed history of the colonial tax systems between the settlement of Jamestown and the beginning of the Revolutionary War.

It's an extraordinary accomplishment. After all, this is not one story but many. Every colony had its own distinctive -- and often dysfunctional -- tax system. Rabushka sets out to describe each one, and generally speaking, he pulls it off quite admirably. In dispassionate and even-handed prose, he tells a complex and detailed story. The resulting book is truly encyclopedic. It is not, mind you, a page-turner; the book is filled with too much disparate data to make for an easy read. But that's its signal virtue.

After all, this is not a book designed to be read at a single sitting, or even several. While not a reference work per se, it will serve that purpose for most readers. No other work of modern tax history manages to cram so much information between two covers.

There's only one problem with this book: It's too even-handed. Rabushka, a senior fellow at the Hoover Institution, is best known for his outspoken advocacy of the flat tax. One might reasonably expect that his historical work would show a similar passion, not to say polemicism. After all, many historians with less overt politics have written very political books. But Rabushka has assiduously avoided that temptation. This is dispassionate scholarship -- a virtue by almost any measure.

The Return of Tax History

In recent years, the history of American taxation has undergone a renaissance of sorts. After years of neglect, it's attracted new interest from scholars in a range of disciplines, including history, law, political science, sociology, and economics. Indeed, this renaissance is old enough that we may have to stop using that word. It seems fair to say that we've entered a second, more mature phase of this intellectual endeavor, as scholars begin to engage one another around a common set of questions and concerns.

Even more important, tax history has begun to attract the attention of scholars who are not, by training and inclination, tax specialists. It's all well and good for law professors to decide that history is important to tax. But it's even more important for historians to decide that tax is important to history.

In recent years, we've seen a number of fine books published on the subject of tax history. A few -- like the essay collection edited by Ajay Mehrotra, Monica Prasad, and Isaac Martin slated for publication by Cambridge University Press next year -- treat tax history not simply as a collection of disparate research projects, but as a common intellectual endeavor.

All of which is great. But much remains to be done. Certain areas and time periods remain ripe for examination. Or reexamination, as in the case of colonial taxation. Once upon a time, this was a popular topic for historical study. I'm thinking, for instance, of works by Edmund Morgan, Roger Brown, and Robert Becker, not to mention a slew of unpublished dissertations and master's theses, many written in the late 19th and early 20th centuries.

More recently, however, scholarship on colonial tax systems has been sparse. At least until lately. In 2003 Max Edling of Uppsala University published A Revolution in Favor of Government, exploring tax issues in the context of early American state building. In 2005 Calvin Johnson of the University of Texas Law School offered Righteous Anger at the Wicked States, an exploration of Early Republic tax debates that managed to score a review in The New York Review of Books. And in 2006, Robin Einhorn, a historian at Berkeley, gave us American Slavery, American Freedom, an ambitious and provocative reassessment of taxation before and after the Revolution.

Rabushka's book joins this impressive literature but does not directly engage it. Instead, it provides the kind of information and data that must necessarily underpin analytical works on colonial and Early Republic taxation.

The book is not without thematic interest. It illuminates, for instance, the intimate connection between war and taxes: In a colonial era marked by light tax burdens, the only periods of relatively high taxation came during and after military conflicts. Rabushka also highlights the use of tax preferences to keep the colonial tax burden low, especially in comparison to Great Britain. The colonial world was a low-tax paradise -- today we would call it a tax haven. Low taxes, according to Rabushka, encouraged phenomenal growth, prompting a steady flow of emigrants across the Atlantic.

It's possible, with a bit of exegesis, to discern Rabushka's contemporary politics in these themes. But it takes some doing, for the book is relentlessly empirical, not analytical. On balance, that is a great achievement, ensuring that the book will find a place on the shelf of every scholar of American taxation.

But one could still wish for a bit more engagement with the literature. The historiography of early American taxation is hardly robust, but it's getting there. And it seems more than likely that someone like Rabushka -- a scholar with a long history of rousting the complacent when it comes to taxes -- would have interesting things to say.

It would have been nice to hear more about the rhetoric, ideas, and politics of taxation. Rabushka points out, for instance, that most British efforts to raise the colonial tax burden were unsuccessful. The Sugar, Stamp, and Townshend acts would have raised colonial tax burdens dramatically, perhaps by a factor of three. But as a group, they raised only about a sixth of their expected revenue. They failed because the colonists resisted.

Which raises a host of questions: Why did the Americans resist British taxes? For ideological reasons? Pecuniary self-interest? Are the two even distinguishable? More broadly, does the history of colonial taxation suggest an American predisposition to tax avoidance and resistance? If so, how is it passed down? Taken as a whole, can the Revolution provide a viable creation myth for America's antistatist political traditions? Are we, in some primordial sense, a nation of tax haters?

These are important questions (although by no means the only ones). And Rabushka sheds light on many of them. But he does so carefully, indirectly, and -- for my taste -- just a bit too politely. This book gives us ample data, but somewhat less analysis. Or more precisely, the analysis is hard to find amid all the data.

To be fair, that's just the nature of the book -- and the source of its greatest strength. But when all is said and done, it leaves this reader wanting more. Or perhaps less.


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Joseph J. Thorndike is a contributing editor for Tax Notes.