In her book, Tax and Spend: The Welfare State, Tax Politics, and the Limits of American Liberalism (University of Pennsylvania Press, February 2012), Washington and Lee history professor Molly Michelmore traces the development and taxing and spending policy from the New Deal through the Reagan Revolution.
As Molly explained in an article about her book earlier this year, "Nobody ever talked about how taxes pay for the welfare state, but it seemed that taxing policy and spending policy should be examined together. It is impossible to talk about any kind of American political debate without thinking about how you're going to pay for the things that people want."
Molly's arguments are called "timely, shrewd and important" in a piece by Harvard historian Jill Lepore in the Nov. 26 edition of The New Yorker. (Here's the link to the edition, but suscription is required.)
In The New Yorker piece, Lepore notes how Molly's study concluded that "liberal policymakers who created the welfare state in the nineteen-thirties were squeamish about taxes, an aversion most manifest in the decision to fund the Scoial Security act of 1935 with an indirect tax, on payroll."
Lepore goes on to quote from Molly's book on the way that "old-age and unemployment assistance" programs were cast as different from poverty programs:
"Defended, sold and understood more like private insurance than public welfare," Michelmore writes, old-age and unemployment assistant programs "not only escaped the hostility heaped on other forms of public provision, but have often fallen outside the public's understanding of welfare altogether."
In June 2011, well before "fiscal cliff" had become such a pervasive media phrase, Molly wrote about the debt crisis in a Christian Science Monitor op-ed. It began: "The United States has a debt crisis, but almost no one is willing to point out that the best way to solve the nation’s financial problems may be to raise taxes. Not just on the rich, but on the middle class as well." In July, her piece, "Don't Blame the Republicans for the No-Tax Pledge — Democrats Are Allergic to Tax Hikes, Too," appeared on the History News Network.
Molly's current research project, "As a Taxpayer and a Citizen: Rights, Obligations and Democracy in Modern America," examines how various groups, including women, African Americans, property owners, pacifists and anti-war activists, immigrants and anti-immigration activists, the poor, and gay men and women have used their political and legal identities as taxpayers to effect policy changes and to expand (or defend existing) boundaries of citizenship.