The A.P. U.S. History Test Could Shift Its Dates And Get Wildly Different Answers

Last week in high school across the country, the biggest Advanced Placement test of the year took place. More students take United States history than any other AP test. It is justly a mark of national pride that so many of our striving young sit for this test that gets them into the meaningful details of our great past.

I have come to praise the “APUSH” test, not to bury it, and I call attention to the central question last week:

“Evaluate the extent to which the role of the federal government in the United States economy changed from 1932 to 1980.”

Good question. The only issue I raise is, what if we shifted the dates just a bit, say from 1920 to 1964? What if the question were:

“Evaluate the extent to which the role of the federal government in the United States economy changed from 1920 to 1964.”

All this would do is shift the first date back twelve years and the last sixteen. The period in either case would be forty-plus mid-century years. I submit that the answers to the questions, on account of the shift, could be radically different.

When we see a beginning date of 1932, we think automatically of a flailing President Herbert Hoover doing nothing effective to arrest the ever-worsening spiral of the Great Depression. Although I do wonder if we ever contemplate Hoover’s demand that the top rate of the income tax be raised by 150 percent as of January 1^st of that year. He got his wish, and given that all jobs come from the investment decisions of the top earners, why exactly is this essentially unknown in our ample memory of the Great Depression?

Anyway, 1932-1980 gives one immense opportunity to talk about FDR, whoever that was. And LBJ. (BTW: My shorthand for Lyndon Baines Johnson is LeBron James. And that for Herbert Hoover is Humbert Humbert.) FDR and LeBron greatly increased government’s role in the economy, and it worked until the crisis of Keynesianism in the 1970s—there’s a five (top score on the one-to-five AP scale), given the relevant detail.

But what if the dates were 1920-64? Now we have quite a different narrative. Here goes:

“Having never had an income tax of any size until 1917, the top rate of that tax was 73 percent from 1919-21, as the country endured both a depression and an increase in the price level since 1913 of 120 percent. Warren Harding entered office in 1921 and put all priority on bringing the top tax rate far down. As he and his successor Coolidge brought that rate to 25 percent, one of the greatest expansions in American history took place, that of the Roaring 20s.

“Hoover, becoming president in 1929, called a stop to this top tax rate cutting and decided that tariffs and income tax rates at the top had to rise. As for the latter, he took them up by 150 percent over 1929-32, from 25 to 63 percent. The Depression was an inevitable outcome of such decisions.

“FDR adopted and enhanced Hoover’s tax policy, quickly raising the top rate to 79 percent and beyond, as unemployment far past 10 percent stayed normal. FDR ran for president in 1940 not only because of the international crisis, but because the Depression at home was far from solved after his many years in office, and he had to try to get that stain off his back.

“At last in 1948 Congress, having cut federal spending by three-quarters in three years, cut tax rates radically, over Truman’s third veto. The economy responded with postwar prosperity vibes.

“Ike liked the top tax rate at 91 percent, and we got three recessions in short succession in the 1950s.

“JFK said cut tax rates, especially at the top, and the greatest of booms shone forth. Prosperity in America became the greatest thing ever. In one illuminating case, the Beatles got scared out of their wits by the Beach Boys (on or about the JFK tax cut). Britain was growing at a snail’s pace in the 1960s while the US was reaching incredible heights. ‘I wish they all could be JFK tax cuts,’ the Boys all but said. The life of that time—it was amazing on the beach—could point to crazy prosperous and good times as broad-based bounty swelled with taking top tax rates well below FDR’s. ‘Good Good Good vibrations’ was the American economy after tax rates got cut in 1964.

“And then it came crashing down. LeBron said spend domestic and foreign like crazy and dis-enact the tax-rate cuts via a surcharge and go off the gold standard. ‘Bye, bye, Miss American Pie’ became the new anthem, reflecting the conditions.”

If we begin in a down period undone by top-tax-rate cuts and end in a period resplendent with top-tax-rate cuts (1920-64), we get quite a different history from government-rescued-capitalism, the boilerplate of the 1932 staring-point narrative. The dirty secret of American economic history in the 20^th century is that virtually all growth came when we got serious about cutting top income tax rates.

The APUSH, the grand exam, is as alert to this reality as academic fashion permits. How about getting real, academic fashion?