The world has changed a great deal. Inflation alone might account for a good portion of the need for new revenue, just as one could live in upper middle class comfort in the 20s on $7500 a year. As I mentioned, our position in the world changed, and we became the bulwark of the Free World. There are other factors. Last summer I was in Raleigh, and went to a state museum. One of the things that struck me was that the main aim of the Progressive movement in that state in the 30s was to build paved roads. Paved roads were controversial, and one was considered a moderate leftist for wanting the state government to make sure that they were provided! Thus, in a similar way, the infrastructural improvements in a rapidly industrializing economy, for example in harbors and interstate highways, would have placed more demands on the budget than were expected in the agrarian economy of the 19th century.
It is true that regulatory expansion and subsidies had something to do with the growth of the Federal Government. However, many of those were enacted prior to the New Deal, without a lot of controversy. Most farm subsidies began prior to the First World War, and important regulatory agencies, like the Interstate Commerce Commission, date from the 19th century. Whether well or ill- advised, the Federal Government was already involved in such activities, because, I think, the growth of the Union changed the perception of the relationship of the Federal Government with the states. After all, as new territories entered the Union, they were accepted by the Federal Government, which had participated in their administration as territories. Thus, instead of the states creating the Union, the Union created most of the states......... |
