Tax Populism and Reagan’s Tax Reforms: The Perspective of the Fiscal Sociology

Seiichiro Mozumi, Yokohama National University

Employing the research frameworks of the fiscal sociology and the ideational and political-strategic approaches to populism, this paper examines how Ronald Reagan legislated three tax reforms—the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA), the Deficit Reduction Act of 1984 (DEFRA), and the Tax Reform Act of 1986 (TRA86)—that have been evaluated as exceptional successes in reversing the American tax regime in the 1980s. This paper demonstrates the following two points neglected by the previous studies. First, the Reagan administration’s Cabinet Council of Economic Affairs (CCEA) and the Treasury crafted TEFRA, DEFRA, and TRA86 as a series of fundamental tax programs—the combination of rate cuts with base-broadening and simplification measures—to achieve the Reagan administration’s policy goals: lowering interest rates, maintaining the value of the U.S. dollar, promoting capital formation, curbing inflation, and enhancing productivity. Second, Reagan acted as a political leader to justify his tax reforms by using the words of the two tax populisms: his tax reforms would achieve his administration’s economic policy goals to provide benefits to the average American and to provide them with a fairer, simpler, and more neutral federal tax system. This paper illustrates these points by using archival resources from the Ronald Reagan Presidential Library, the Library of Congress (Donald T. Regan Papers), and the Hoover Institution Archives (Charles E. McClure Papers).

No extended abstract or paper available

 Presented in Session 2. States, Politics and Society