Dwight Eisenhower is usually described as a fiscal conservative but he also established numerous new federal taxes and embarked on the most ambitious infrastructure project in the nation's history. How does this make sense?

by shotpun
The_Alaskan

There's actually a lot to unpack in this question, so you'll have to bear with me.

First, let's mention that the definition of "fiscal conservative" has really changed in the United States during the 60 years since Eisenhower was president. During his tenure, Eisenhower was considered a moderate Republican because, as the Miller Center puts it:

"Eisenhower criticized the statist or big government programs of Truman's Fair Deal, yet he did not share the extreme views of some Republican conservatives. These 'Old Guard' Republicans talked about eliminating not just Fair Deal but also New Deal programs and rolling back government regulation of the economy. Eisenhower favored a more moderate course, one that he called Modern Republicanism, which preserved individual freedom and the market economy yet insured that government would provide necessary assistance to workers who had lost their jobs or to the ill or aged, who through no fault of their own, could not provide for themselves."

In contemporary conversation, the popular notion of a fiscal conservative is someone quite a bit more reactionary than Eisenhower was, more in line with Taft, the man Eisenhower defeated for the 1952 Republican nomination.

Eisenhower had a particular fetish for balanced budgets, but he didn't categorically deny increases in spending or systematically dismantle programs for their cost. He resisted increases in domestic spending and sought efficiencies/reductions, but he was willing to approve new programs and expand others. He created the Department of Health, Education and Welfare, for example, and supported federal backing for low-income housing. He also signed legislation expanding Social Security benefits. To compensate, he resisted calls to lower taxes, preferring to keep the federal budget in the black. He preferred pay-as-you-go programs; the expansion in Social Security was paid for with an increase in the payroll tax.

Tremendously aiding Eisenhower's effort was one of the biggest economic booms in American history. With European and Asian economies still recovering from World War II, and the United States having rebounded from a brief postwar recession, Eisenhower inherited an economic situation that was roaring on all cylinders. While the federal budget grew during Eisenhower's tenure, it did so at a much slower pace than the economy as a whole. As a result, the federal budget fell from 20.4 percent of the Gross Domestic Product at the start of his eight-year term to 18.4 percent at the end of his tenure.

Also consider that regardless of what Eisenhower believed, Congress was (and remains) the appropriating body under the U.S. Constitution. Eisenhower had a Republican Congress to aid him when he started his Presidential term, but Democrats took control of Congress during his tenure and held majorities through his second term.

Now, let's turn to the second part of your question, that of the Interstate Highway System.

Eisenhower led one of the U.S. Army's earliest transcontinental road voyages, which took place in 1919 and was a remarkably difficult experience. In his memoirs and other written material, Eisenhower repeatedly reflects on the difficulty of that journey, which took months. Partially as a result of that experience, Eisenhower was a particular devotee of an improved American road system. While he initially favored a system of two-lane paved highways, his experience in Germany gave him an appreciation for multi-lane, grade-separated superhighways.

As the Federal Highway Administration's own history states, there was plenty of support in Congress for a national interstate highway system, but the perennial issue was how to pay for the program and what it should look like. A 1954 speech by Vice President Richard Nixon (Eisenhower's sister had died, preventing him from giving the speech) to an assembly of state governors largely broke the legislative logjam and gave the idea presidential backing.

Given Eisenhower's desire for balanced budgets, he initially believed that a network of toll highways was the appropriate way to go about the program. Instead, he was swayed to the idea that bonds ─ funded by gasoline taxes ─ would be the best way to get shovels moving. Thus, just as he did with expanded Social Security benefits, Eisenhower was willing to pay for a program that cost more ─ if Congress agreed to find a way to pay for it.

In short, it's important to note that the notion of "fiscal conservatism" has changed markedly in the past 60 years. Eisenhower was willing to authorize new programs and spending ─ but only if taxes could be found to pay for them. Thirty years after he left office, George Bush attempted to do the same thing, but with much less success. After going back on his pledge, "Read my lips: No new taxes," Bush was defeated in his bid for re-election, allowing Bill Clinton to win the presidency.

I'll add that Eisenhower Versus 'The Spenders': The Eisenhower Administration, the Democrats and the Budget, 1953-6 by Iwan Morgan is a deep dive into this topic, and John Sloan's Eisenhower and the Management of Prosperity is another work to consider.