1. “The Crisis of the Tax State,” in Swedberg, Richard, ed., Joseph A. Schumpeter: The Economics and Sociology of Capitalism (Princeton, NJ: Princeton University Press, 1991), p. 138Google Scholar.

2. Lubell's, characterization of Truman is the title of chapter 2 in his The future of American Politics (New York: Harper Colophon Books, 1965)Google Scholar.

3. Katznelson, Ira and Pietrykowski, Bruce, “Rebuilding the American State: Evidence from the 1940s,” Studies in American Political Development 5 (Fall 1991): 338CrossRefGoogle Scholar.

4. For a recent analysis, see Brown, Michael K., “Stacking the Deck: The Truncation of Universalism, 1939–1950,” paper presented to the Annual Meetings of the Social Science History Association, Baltimore, MD, 11 4–7, 1993Google Scholar. See also Skocpol, Theda and Amenta, Edwin, “Redefining the New Deal: World War II and the Development of Social Provision in the United States,” in Weir, Margaret, Orloff, Ann, Skocpol, Theda, eds., The Politics of Social Policy in the United States (Princeton, NJ: Princeton University Press, 1988), pp. 81–123Google Scholar; Brody, David, “The New Deal and World War II,” in Braeman, John, Bremner, Robert H., and Brody, David, eds., The New Deal: The National Level (Columbus: Ohio State University Press, 1975), pp. 267–309Google Scholar.

5. “Rebuilding the Sate,” p. 338.

6. Here I should make clear that I take issue with arguments that the passage of the Employment Act of 1946 eventuated in a “consensus” over “commercial Keynesianism.” For representative statements, see Stein, Herbert, the Fiscal Revolution in America (Chicago: University of Chicago Press, 1969), chap. 9Google Scholar; Collins, Robert, The Business Response to Keynes (Columbia University Press, 1980), chap. 6Google Scholar.

7. Joseph Schumpeter, “The Crisis of the Tax State,” p. 101.

8. Colm to Appleby, March 10, 1944, p. 2, RG 51, Series 39.3, Box 1, National Archives (hereafter NA). Colm remained, both in the Bureau and later on the Council of Economic Advisers, a tenacious advocate of an expanded, egalitarian welfare state.

9. Brinkley, Alan, “The New Deal and the Idea of the State,” in Fraser, Steve and Gerstle, Gary, eds., The Rise and Fall of the New Deal Order (Princeton, NJ: Princeton University Press, 1989) pp. 85–121Google Scholar discusses the ideological aspects of this transformation.

10. Brady, Patrick G., “Toward Security: Postwar Economic and Social Planning in the Executive Office” (unpublished Ph.D. dissertation, Rutgers University, 1975), p. 54Google Scholar; Delano to President, March 14, 1941, OF 1092, NRPB, Franklin Delano Roosevelt Library (hereafter FDRL). Delano's memo (p. 1) lists four other NRPB projects they were working on at the time: financing of public improvements, the broadening of social security, study of matching funds for state and local governments, and investigation of “sources of funds for carrying out post-defense plans designed to develop the full use of our national resources.”

11. Ibid., p. 51. For further information on the NRPB's activities, see Frederick Delano to FDR, 08 25, 1939, OF 1092, FDRL; “Report of NRPB (Conference with the President …,” October 17, 1939, OF 1092, FDRL; Delano to FDR, April 16, 1940, OF 1092, FDRL; Delano to FDR, November 12, 1940, OF 1092, FDRL; Delano to FDR, March 14, 1941, OF 1092, FDRL; Delano to FDR, October 23, 1941, OF 1092, FDRL. All of these documents make the centrality of public works and natural resources planning to the NRPB's activities quite clear; see also Warken, Philip, A History of the National Resources Planning Board, 1933–1943 (New York: Garland, 1979), pp. 76–80Google Scholar, 116. They also indicate the importance the NRPB placed on fiscal policy; see especially Delano's November 12, 1940 memo.

12. Olson, James S., Saving Capitalism: The Reconstruction Finance Corporation and the New Deal, 1933–1940 (Princeton, NJ: Princeton University Press, 1988), pp. 112, 117Google Scholar.

13. Ibid., pp. 11, 161. Like Olson, Jordan A. Schwarz puts state capitalism at the center of New Deal political economy, but defines it as synonymous with public investment. In Schwarz's view, state capitalism in the New Deal was undertaken to industrialize the South and West. There is something to this, but the idea is not systematically developed by Schwarz. In either case, the implication is that the New Deal was organized around the use of public power to underwrite economic growth. See The New Dealers: Power Politics in the Age of Roosevelt (New York: Random House, 1993), pp. xi–xii.

14. National Resources Development, Report for 1943: Part I, Post-War Plan and Program (Washington, DC: U.S. Government Printing Office, 1943), p. 4; Patrick G. Brady, “Toward Security: Postwar Economic and Social Planning in the Executive Office,” pp. 49–50, 90–91. The idea of growth with equity derived, partly, from a strand of New Deal liberalism that sought to combine planning with redistribution, an effort most apparent in New Deal conservation policies. See Koppes, Clayton, “Conservation and the Continuity of American Liberalism, 1939–1953” (Social Science Working Paper, No. 174, California Institute of Technology. 12 1974), pp. 2–5Google Scholar.

15. Alan Brinkley, “The Idea of the State,” p. 107.

16. Most of the planning for the postwar welfare state proposals was well under way by the time Delano met with FDR. And it was not until late October that Delano told Roosevelt, “we now have the conclusions and recommendations from the report of our committee available in case it seems to you desirable to forward this statement of the general issues to the Congress prior to any specific proposal for amendment of the Social Security Act.” Delano to FDR, October 22, 1941, p. 4, OF 1092, FDRL. Most of the crucial decisions had been made by then and Roosevelt had already announced his intentions at a September 30, 1941 press conference. For a more detailed account of the planning, see Michael K. Brown, “Stacking the Deck,” pp. 9, 17–18.

17. Roosevelt to Delano, September 9, 1942, OF 1092, FDRL. Katznelson's and Pietrykowski's only “evidence” that Roosevelt was considering alternative models of planning is that both agencies were retained in the Executive Office of the President; however, this proves nothing about FDR's intentions; “Rebuilding the State,” p. 314. Roosevelt, of course, had a habit of setting rival agencies against one another so as to retain control of any decision, which means that it is impossible to deduce his intentions about postwar planning from the continued operation of the NRPB. Note, moreover, that the NRPB plans for the postwar welfare state were not all that different from the Social Security Board's proposal, further evidence of the similarities in the thinking of New Deal liberals. If anything, the NRPB was less bold, for it ducked, unlike the Social Security Board, the question of national health insurance. For a full discussion, see Michael K. Brown, “Stacking the Deck,” pp. 11–13.

18. The Bureau's main competitor at this time was not the NRPB but the Treasury Department. With the shift of the Budget Bureau to the Executive Office of the President in 1939, Morganthau began to lose control over the budget, and thus leverage in the debate over spending.

19. Katznelson and Pietrykowski take expressions of any concern over inflation rather than depression in the postwar period as a measure of the difference between the NRPB and the Bureau, but one can find similar views in the NRPB; see Patrick G. Brady, “Toward Security: Postwar Economic and Social Planning in the Executive Office,” p. 57.

20. Colm to Jones, February 1, 1941, Box 65; April 4, 1944, Box 1; “Basis for Postwar Employment Policy,” February 8, 1944, Box 71, #430; “Guaranteed of National Minimum,” August 24, 1944, Box 71, #431, RG 51, Series 39.3, NA. On the significance and origins of Roosevelt's 1944 speech, see Mary H. Hinchey, “The Frustration of the New Deal Revival, 1944–1946,” p. 13.

21. “Rebuilding the State,” p. 333.

22. Smith to Loeffler, September 9, 1943, RG 51, Series 39.3, Box 71, NA.

23. Loeffler to Director, September 15, 1943, RG 51, Series 39.3, Box 71, NA, “Proposed Message to Congress,” p. 2. The statement was carefully crafted of course in anticipation of Congressional resistance. Indeed, Loeffler expressed the staff's “bafflement as to how the idea could be presented to Congress in a manner which would result in prompt affirmative action.”

24. Smith to Truman, February 4, 1946, Confidential Files, Box 6, Harry S. Truman Library (hereafter HSTL); Smith to FDR, March 14, 1945, Harold D. Smith Papers, Box 4, FDRL. Smith eventually formally recommended that Truman sign the legislation, but his February memorandum is a better guide to what he really thought about the Employment Act. Smith to Truman, February 15, 1946, Bill File, 2/20/46 to 2/26/46, Box 9, HSTL. Katznelson and Pietrykowski cite statements by BOB personnel as evidence of the Bureau's focus and intentions. But this is a poor guide to either Smith's intentions or the conception of planning then being considered.

25. For a detailed discussion of the origins of the conservative alternative to the Third New Deal, see my “Stacking the Deck: The Truncation of Universalism, 1939–1950,” pp. 19–30.

26. Holmans, Arthur puts it this way: “the institutional clash became merged with the straightforward political clash when the anti-Roosevelt coalition gained control of the Congress”; United States Fiscal Policy, 1945–1959 (New York: Oxford University Press, 1961), p. 28Google Scholar.

27. Frederick Delano to FDR, February 8, 1940, OF 1092, FDRL. Lauchin Currie also reported to Roosevelt that Sam Rayburn (Speaker of the House) had told Tom Corcoran, “the source of the real opposition to the Planning board is the Army Engineers who have been actively lobbying against the Board.” PSF: Subject Files, Currie to President, January 22, 1940, Box 115, FDRL. Philip Warken, A History of the National Resources Planning Board, documents the opposition of the Army Corps of Engineers to the NRPB, pp. 68–70, 98–99.

28. Patrick Brady, “Toward Security: Postwar Economic and Social Planning in the Executive Office, 1939–1946,” pp. 271–72.

29. Both agencies were in the business of appraising Presidents of economic trends and developments, seeking to contribute to their economic education, and providing lots of advice, whether the President took it or not. I base this on extensive reading in the archival records of the NRPB in the Roosevelt library and the CEA during the Truman, Kennedy, Johnson, and Nixon administrations.

30. Morgan, Iwan W., Eisenhower Versus ‘The Spenders’: The Eisenhower Administration, the Democrats and the Budget, 1953–1960 (London: Pinter Publishers, 1990), p. 30Google Scholar.

31. Pearson, Alec P. Jr, “Olin E. Teague and the Veterans Administration” (Unpublished Ph.D. Dissertation, Department of History, Texas A&M University, 1977), pp. 86–87, 102, 109, 162Google Scholar; Steiner, Gilbert, The State of Welfare (Washington, DC: The Brookings Institution, 1971), pp. 251–55Google Scholar.

32. Arthur E. Holmans, United States Fiscal Policy, 1945–1959, p. 104; Wagnon, William O., “The Politics of Economic Growth: The Truman Administration and the 1949 Recession” (Unpublished Ph.D. dissertation, University of Missouri, 1970), pp. 45–46, 48, 51, 54–55Google Scholar.

33. M.S. March, April 22, 1949, RG 51, Series 39.3; Frank Pace told Truman that extending “52–20” unemployment benefits would “indicate a willingness to provide special benefits beyond the terms of the Veterans Readjustment Act, which could open the door and prove embarrassing at a later date with respect to possible bonus or other special veterans' legislation.” Director to President, July 8, 1949, OF 396, Box 1076, HSTL. The administration's lack of options are documented in Brenner to Cohn, May 5, 1949, March, M.S., “National Defense,” 04 27, 1949Google Scholar, Stark to Cohn, April 26, 1949, Hubbell to Reeve, March 24, 1949, RG 51 Series 39.3, #403, Box 67, NA.

34. Foreign Relations of the United States, vol. 1, 1949, pp. 350–51. Truman's budget director told him that neither the Marshall plan nor domestic programs could absorb large cuts, but “sizable reductions are possible, however, in military expenditures, without improperly reducing the nation's relative readiness for an emergency.” Pace to President, June 30, 1949, C.F. Box 6, papers of Harry S. Truman, HSTL. Pace wanted to request only $13 billion for defense, which was $2.5 billion below the level necessary to sustain the defense establishment at 1950 levels. For a more extensive discussion of the absence of military Keynesianism in the Truman administration, see Pollard, Robert A., “The National Security State Reconsidered: Truman and Economic Containment, 1945–1950,” in Lacey, Michael J., The Truman Presidency (New York: Cambridge University Press, 1989), pp. 205–34CrossRefGoogle Scholar.

35. “Tax and Expenditure Policy,” December 16, 1949, Papers of Clark M. Clifford, Box 4, HSTL.

36. Kennedy told Congress that “Our choice is between chronic deficits … and transitional deficits temporarily enlarged by tax revision designed to promote full employment and thus make possible an ultimately balanced budget …” Kennedy reassured Congress that “… as the economy climbs toward full employment, a substantial part of the increased tax revenue thereby generated will be applied toward a reduction in the Federal deficit.” Public Papers of the Presidents of the United States: John F. Kennedy, 1963, p. 77. See also “Letter to Chairman, House Ways and Means Committee, on Tax Reduction,” August 21, 1963, Public Papers of the Presidents of the United States: John F. Kennedy, 1963, pp. 637–39; and Kermit Gordon to Jacob Javits, May 25, 1963, RG 51, Series 61.1a, E3–2, 1st Grey Box, NA.

37. See, passim., Derthick, Martha, Policy Making for Social Security (Washington, DC: The Brookings Institution, 1979)Google Scholar; and Weaver, Carolyn, The Crisis in Social Security: Economic and Political Origins (Durham, NC: Duke University Press, 1982)Google Scholar.

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39. Grodzins, Morton, The American System: A New View of Government in the United States (Chicago: Rand McNally & Co., 1966), see especially chap. 10Google Scholar.

40. See Skocpol, Theda and Finegold, Kenneth, “State Capacity and Economic Intervention in the Early new Deal,” Political Science Quarterly 97 (Summer 1982): 255–78 for one statementCrossRefGoogle Scholar.

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43. “The Crisis of the Tax State,” p. 108. For an account of the relevance of taxes to state building, see Levi, Margaret, Of Rule and Revenue (Berkeley: University of California Press, 1988)Google Scholar.

44. Ibid., pp. 110, 112, 114.

45. Tax protest was a central feature of Roosevelt's political environment during 1933–34, and it shaped his policy choices. See Michael K. Brown, “The Policy Settlement of 1935,” in Divergent Fates: Race and Class in the Making of the American Welfare State, 1935—1985; see as well Clifton, Yearly, The Money Machines (Albany: State University of New York Press, 1970), esp. chap. 2Google Scholar.

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48. See Steinmo, Sven, “Social Democracy vs. Socialism,” Politics and Society (1988): 403–38Google Scholar for a demonstration of this proposition in the Swedish case.

49. Steinmo, Sven, “Political Institutions and Tax Policy in the United States, Sweden, and Britain,” world Politics 41 (07 1989): 504–507, 517–19CrossRefGoogle Scholar, explains this in light of corporatism. There are palpable signs of tax resistance in Sweden. One young Swedish autoworker told a reporter before the 1991 elections, “The Social Democrats think it's a luxury to go to the movies.” She went on to say, “it's impossible to make any money. The Social Democrats want everybody to be poor together.” “Discontent in Egalitarian Sweden Threatens Socialists in Vote Today,” The New York Times, September 15, 1991, sect. A, p. 10.

50. Sanders, Heywood, “Building the Convention City: Politics, Finance, and Public Investment in Urban America,” Journal of Urban Affairs 14 (1992): 135–59CrossRefGoogle Scholar.

51. MacMahon, Arthur W., Millett, John D., and Ogden, Gladys, The Administration of Federal Work Relief (Chicago: Public Administration Service, 1941), pp. 55–57, 121–23Google Scholar; Jordan A. Schwarz, The New Dealers, p. 258; James S. Olson, Saving Capitalism, pp. 92–96, 141–43.

52. Merriam, Lewis, Relief and Social Security (Washington, DC: The Brookings Institution, 1946), pp. 288–89Google Scholar. The funding of Title II of the Bankhead-Jones Act was one of the central issues in the Congressional investigation of the Farm Security Administration during the early 1940s.

53. Currie to Roosevelt, March 15, 1940, PSF: Subject Files, Box 115, FDRL; Delano to Roosevelt, March 14, 1941, p. 1, OF 1092, FDRL. See Baldwin, Sidney, Poverty and Politics: The Rise and Decline of the Farm Security Administration (Chapel Hill: University of North Carolina Press, 1968), pp. 352–362Google Scholar, for an account of the FSA's budget war.

54. Margaret Weir and Theda Skocpol say state structures may indirectly influence policies by inspiring “the very demands that are pursued through politics.” See “State Structures and the Possibilities for ‘Keynesian’ Responses to the Great Depression in Sweden, Britain, and the United States,” in Evans, Peter B., Rueschemeyer, Dietrich, and Skocpol, Theda, eds., Bringing the State Back In (Cambridge: Cambridge University Press, 1985), p. 118CrossRefGoogle Scholar. This vague phrase, which is not really elaborated, is only understandable as a comment on the effects of organizational structure and routines.

55. For representative statements, see Quadagno, Jill, The Transformation of Old Age Security (Chicago: University of Chicago Press, 1988), esp. chap. 3Google Scholar; and Domhoff, G. William, The Power Elite and the State (New York: A. de Gruyter, 1990)Google Scholar.