That 1984 public opinion survey by the IRS, revealing that a striking 80% of Americans felt the tax system benefited the rich and was unfair to the ordinary working man and woman, truly pulls back the curtain on a significant societal shift. It’s a candid reflection of how people perceived the economic landscape during a period of profound change, a sentiment that stands in stark contrast to the post-World War II era when 85% of the public considered the federal tax code “fair,” even with top rates up to 90%. This widespread belief wasn’t born in a vacuum; it was a direct response to a series of policy decisions that, decade by decade, systematically favored concentrated wealth over the broader populace.
Consider the trajectory of tax policy leading up to this point. The trend of lowering tax rates on the wealthy wasn’t solely a Reagan administration initiative. It actually began earlier, with the Kennedy-Johnson administrations, which, under the guise of “tax reform,” reduced the World War II-era top rate of 91% on incomes over $400,000 to 70%. The Carter administration, too, despite some objections, saw Congress pass measures that granted even more tax breaks to the rich. Then came the Reagan years, where, with the collaboration of Democrats in Congress, the tax rate for the wealthiest was further slashed to 50% and, by 1986, to a mere 28%. This effectively dismantled the concept of a “progressive” income tax, where the rich paid higher rates than others.
The consequences of these changes were stark and quantifiable. By 1990, the net worth of the “Forbes 400” — the country’s richest individuals — had tripled, and the wealthiest 1% of the population gained a staggering trillion dollars over thirteen years, while the government lost approximately $70 billion annually in revenue. This was not a minor adjustment; it was a fundamental re-engineering of who paid for what in American society. The average factory worker’s salary, which in 1980 was forty times less than a CEO’s, became ninety-three times less by 1989. Moreover, from 1977 to 1989, the before-tax income of the richest 1% surged by 77%, while the poorest two-fifths of the population saw no gain, and even a slight decline. This widening chasm between the affluent and the struggling became increasingly evident throughout the 1980s and into the 1990s, with economic policy allowing the rich to get richer while the poor became poorer. The share of income going to the wealthiest 20% increased by 13% between 1980 and 1996. By 1995, the richest 1% owned over 40% of the nation’s wealth due to changes in the tax structure.
What’s particularly telling is the disconnect between these policy outcomes and what the public actually desired. Despite politicians and media incessantly discussing “welfare” in a derogatory manner, public opinion polls showed a fundamental generosity among Americans towards helping the poor. When asked if more money should be allocated to “welfare,” only 23% said no in a 1992 New York Times/CBS News poll, but when the question shifted to whether the government should “help the poor,” 64% said yes. Furthermore, specific proposals like a surtax on millionaires garnered 84% support in a December 1990 Wall Street Journal/NBC News poll, and a Canadian-type universal healthcare system was favored by 61% of Americans in a 1989 Harris/Harvard School of Public Health poll. Yet, neither major party adopted these widely supported positions.
This consistent disregard for public opinion by both political parties, which were largely “tied to corporate wealth,” led to a pervasive sense of disillusionment. As early as 1972, 53% of Americans believed the government was “run by a few big interests looking out for themselves,” a figure that soared to 79% by 2013. This growing skepticism about the integrity and responsiveness of government institutions was a significant feature of the era.
The economic philosophies driving these changes were often presented as “natural” or “scientific” outcomes, rather than the result of deliberate policy choices. This framework, often associated with the “Chicago School” of economics, downplayed concepts like equity and democracy, portraying them as “vague, squishy, and dangerous”. The idea was that large corporations were efficient, beneficial for consumers, and should operate with minimal government interference. This coincided with a move toward deregulation across various sectors, from finance to airlines, which, while promising efficiency, often led to consolidated power, reduced worker wages, and increased economic insecurity for many.
The revelation of the CIA’s clandestine operations in Nicaragua, including the mining of harbors, in March 1983, occurred against this very backdrop of public distrust and growing concern about government accountability. It highlighted a government willing to operate secretly and even “violate its own laws” in pursuit of foreign policy goals, further eroding public confidence. This era saw a “post-Vietnam syndrome” where the public was reluctant to support direct military interventions, forcing administrations to rely more on covert actions and proxies. However, when these clandestine activities came to light, as with the Iran-Contra affair, they provoked significant outrage and raised fundamental questions about executive power and the “importance of accountability and official responsibility for faithful execution of laws”.
Ultimately, the 1984 IRS survey finding was a clear signal of public recognition that the economic game was being “rigged” against them, not by some unseen natural force, but by deliberate policies that concentrated wealth and power at the top. This sentiment, though often ignored by the political mainstream, fueled a “permanent adversarial culture” that continued to question the prevailing system, even as the political establishment remained largely unresponsive to the public’s desire for a more equitable society. It underscores a persistent tension in American history: the mobilization of lower-class energy by upper-class politicians for their own purposes, often masked by rhetoric of patriotism and unity. The events of 1984, therefore, represent a crucial point in the ongoing struggle for a truly democratic and equitable society, where the desires of the many are not repeatedly sidelined by the interests of the few.