Shaping Public Opinion and the Law: How a "Common Man" Campaign Ended a Rich Man's Law

Article excerpt

I

INTRODUCTION

The radio schedule published in the New York Times on March 6, 1935, listed twelve "outstanding events" for that day, including two musical concerts, a speech about the "next war," and a talk by Raymond Pitcairn, national chairman of a group called the Sentinels of the Republic, about the ongoing "Pink Slip Publicity Strike." (1) The "pink slip" was the pink-colored form each income taxpayer had to submit along with his income-tax return, pursuant to the Revenue Act of 1934. The form contained certain tax information that would then become public record, even if the taxpayer had no actual tax liability. The "strike" was part of a campaign orchestrated by Pitcairn to force Congress--by dint of public opinion--to repeal this provision. Viewed as an exercise in futility when it began, the campaign quickly gained momentum and soon achieved ultimate success--repeal.

Although the pink-slip provision died quickly, its passage and repeal remain relevant for anyone interested in the media, politics, the New Deal, income taxation, or simply a good tale. At its most basic level it is a fascinating story full of razzle-dazzle, a dash of sexism, and a large dose of kidnapping anxiety. Studying the repeal campaign more deeply, however, offers more-substantive rewards. It provides perspective on the recurrent tension between the right to know and the right to privacy. Indeed, amidst the current financial crisis, publicity of tax information once again has gained some attention. Former IRS Commissioner Mark Everson recently stated, for example, that increasing transparency by publicizing corporate tax returns would more quickly reduce the public's economic fears than regulation would. (2) The story of the pink-slip repeal also deepens our knowledge of conservative groups during the early New Deal, especially regarding federal taxation. Most of all, it enriches our understanding of the use of public relations to influence public opinion for political ends in the field of taxation as well as elsewhere. In doing so, it presents an early example of the still-current political phenomenon by which a small but active and well-financed group influences legislation through the manipulation of public opinion.

The story of the pink-slip repeal contradicts a common criticism of the income tax--that it leads to a tyranny of the minority who "soak the rich." Very few Americans paid income taxes at that time. Nevertheless, the repeal campaign's expert use of public relations, the media, and rhetorical appeals to the "common man" harnessed the hopes and fears of everyday people to support a policy that not only did not affect them, but that helped the rich who were subject to the tax. Today, the scope (and expense) of lobbying campaigns far exceed those of the 1935 repeal campaign, but the basic outlines of that campaign still hold true: a small, well-organized group, rhetorical appeals to the common man--to both his fears and his patriotism--and extensive use of the media to broadcast those appeals and encourage activism by average people. The campaign against the estate tax, which culminated in 2001 with a (temporary) repeal, used a similar template. Although the tax affects a very small percentage of taxpayers, the campaign, funded largely by a small number of very wealthy families, focused on the effect that the estate tax has on average Americans, and especially on quintessential American institutions--family farms and small businesses--the vast majority of whom never pay any estate tax. (3)

II

A SHORT HISTORY OF TAX PUBLICITY IN THE UNITED STATES FROM THE CIVIL WAR TO 1934

In 1934, a law requiring the publication of income-tax information (publicity) was neither a novel idea nor an unprecedented practice in the United States. It was, however, unusual. In fact, in the history of the federal income tax, it had occurred only twice previously: during the Civil War and in 1924; additionally, the 1909, income-based corporate excise tax contained a publicity provision. …